ICAP’s 2016 Lisle Seminar Summary

August 1, 2016, Sheraton Hotel, Lisle, Illinois
2016 Illinois Appraisers Update Seminar
ICAP Reporter, Karen Emerle, SRA

ICAPs third and final 2016 Appraiser Update Seminar was held on August 1, 2016 at the Lisle, Illinois Sheraton Hotel. Opening the day’s event to more than 250 appraisers ICAP’s Immediate Past President Rick Hiton, IFAS introduced ICAPs current President Mike Morris, ARA, MAI. Rick presented Mike an award acknowledging his many years of volunteer service to ICAP, and his faithful and strong leadership during Mike’s presidency.CSC_0173

President Morris introduced Mary Jane Lukas, ICAP’s administrative assistant. Mary Jane keeps the ICAP office organized and running smoothly. President Morris, on behalf of the ICAP Board of Directors, thanked Mary Jane for her professionalism and hard work in whatever task needs attention, and for attending to our memberships phone calls and inquiries. Mike extended a heartfelt thank you to the ICAP membership for attending ICAPs seminars and faithful contributions, and to the many Board members and committee members who volunteer their time working hard on behalf of the appraisal profession.

Now on the governors desk for signature, ICAP’s Bill (HB3333) amends the Illinois Appraisal Management Company Registration Act to create an Appraisal Management Company Recovery Fund. President Morris stated the process for this bill began in 2015 under Rick Hiton’s presidency.  Mike touched on other issues ICAP has addressed during the past year and reminded everyone that our website and exclusive membership ICAP Advantage Newsletter contain information about the issues ICAP continues to work on. ICAP membership includes appraisers in a variety of disciplines. ICAP wishes to thank all of our speakers for their participation in ICAPs Lisle 2016 Illinois Appraisers Update Seminar and for providing an exceptionally good day of education, in a variety of topics, to all in attendance. All speakers provided time for Q & As at the end of their presentations. Many seminar attendees took advantage of the opportunity to ask these experts some insightful and pertinent questions. Thank you. Session highlights from the day follow.

Scott DiBiasio, Appraisal Institute Manager, State & Industry Affairs, presented the opening session Federal & State Legislative Update. Representing 90 chapters and sponsor chapters of the Appraisal Institute, the 4-person Government Relations Office is based in Washington, D.C. Scott can be contacted via phone at 202-298-5593 or via email at sdibiasio@apprasialinstitute.org.DSC_0045

The presentation discussed the state of the Appraisal Profession, the decline in mostly residential appraisers, especially in rural areas, and the factors, such as uncertain business climate, economics, over‑regulation, alternative evaluations, and industry demographics, impacting on the Profession. The AF’s (Appraisal Foundation) current approach to appraising is their effort to turn appraising into a “cookbook type of science” rather than the art it is and has been.

Mr. DiBiasio discussed the four major statutes specific to appraisers amended by the implementation six years ago of Dodd‑Frank. They include: TILA (Truth in Lending Act), FIRREA (Financial Institutions Reform, Recovery and Enforcement Act), ECOA (Equal Credit Opportunity Act), and RESPA (Real Estate Settlement Procedures Act). TILA topics included appraiser independence, reasonable C & R fees, HPMLs (High Priced Mortgage Loans) requirements, and qualified mandatory reporting. FIRREA addressed the Appraiser National Registry fees, AMC minimum requirements and State rules, and ASC policy regarding license reciprocity between States. ECOA includes a provision for the consumer to receive a copy of appraisals and other valuations three days prior to closing.

Mr. DiBiasio also touched on the AMC registry fee for AMC appraiser panels, ICAPs submitted comment letter, appraisal De Minimis threshold levels currently under review, the bank regulators requirement to review regulations every ten (10) years, AVM quality control standard, OCC third party oversight, and the FHA Handbook 4000.1. Additional topics Mr. DiBiaso highlighted are key principles for modernization, federal regulation, State by State portability, uneven playing field, the joint letter by AVOA, AI, NAHB, TAF asking for oversight hearing, SAVE Act and Energy Bill issues, and State issues including evaluations and AO‑13, BPOs, appraisal review, and AMC related issues including background checks, recovery funds, and registry fees.

Ray Brownfield ALC AFM, presented Agricultural Land Trends. Contact information for Mr. Brownfield of Land Pro LLC located in Oswego, Illinois is either by phone 630-258-4800 or email at ray@landprollc.us.DSC_0093

Focused on agricultural and recreational land values, Mr. Brownfield asked the opening question, Where are we now? AG appraisers are needed. AG client types include estate planning, lawyers, farmers, not necessarily purchasers, litigation, right of way, and development planners.

Land values increased 5 to 10 percent between the years 2000 to 2008. Ethanol standards were introduced. Ethanol is used in 40% of the U.S. oil. China entered the market. Good appreciation was seen in land. The 2012 drought was net in Illinois. Farmers had good insurance. A tremendous demand was seen in 2012-2013 with 15 to 20% increase in land values. In Illinois, the 2014 to 2015 period saw a drop depending on land quality. Land quality classes include Class A, Class B and Class C.

Included in the What we need to be watching discussion were commodity prices, demand, weather, domestic and global politics, interest rates and volatility. There is a big demand from China for ethanol; 40% of all corn produced goes to ethanol. Weather is something that cannot be controlled and will always be an issue in AG values. Low interest rates encourage land purchase and trade agreements, export policy and rates also affect AG values.

Where are we going addressed current facts and market pressures. Typically, land investment is long term and can be a great investment. Investors purchasing land lease it back to farmers. Illinois is best suited for soy beans. Linkage includes two rivers, interstate transportation, and railroads. Rental markets capitalize land values and will decline in the future. As commodity prices improve, appreciation prices will decline. A 3.5% net, net, net after taxes NOI is desired. Investors real estate taxes have an impact. Mr. Brownfield advised appraisers to attend and observe auctions. Referred to as the appraisal of the day, they provide a great opportunity to see who the buyers are.

A variety of audience questions included: Who are the investors, difference between AG and residential LTV ratios, the impact of wind farms on land value, types of approach used in land appraisals, and what is considered recreational land.

Closing out the morning sessions John Urubek, MAI, CCIM presented Statistics & the Appraisal Process.

Mr. Urubek commented that the “internet is here to stay. Click on it and someone is collecting your data. Sooner or later it becomes a statistic.” The purpose of the presentation is to encourage more use of statistics in your day to day appraisal practice, to expand your skill sets and experience by applying what you learn, and how to use examples of creative ways to create more credible reports.DSC_0095

To solve the problem with confidence one needs a larger sample size. The focus of the talk is the applications of statistics in real world appraisal problems. Mr Urubek asked the question, “should I use statistics in my appraisal?” Appraisals refer to probability. USPAP SR1‑1(a) states an appraiser must: “be aware of, understand, and correctly employ those recognized methods and techniques that are necessary to produce a credible appraisal.” Through the use of four examples, Mr. Urubek provided creative and practical ways to use to statistics in the appraisal process. Definitions of “descriptive” and “inferential” statistics were presented.

Mr. Urubek closed his presentation by reminding attendees that an appraisal must adhere to accepted appraisal principles, USPAP, laws and regulations, and assignment conditions. Mr. Urubek can be reached at phone 708‑557‑3662 or by email at jurubek@aol.com. For those in attendance expressing further interest in learning more about statistics and using them in their appraisal reports, Mr. Urubek teaches the class, Interpretation and Application of Simple Linear Regression. Contact Mr. Urubeck directly at jurubek@aol.com if you would like further information.

ICAPs emcee for the day was Randy Barcella, Real Estate Revealed. Randy’s show can be heard Sundays on Wealth Essentials Radio, AM560 the Answer. Thank you Randy for graciously hosting the day’s events. Randy closed the morning session asking a representative from each vendor to introduce themselves and invite seminar attendees to visit their booth. A special thank you to all the participants in the Vendor Showcase:

Their participation enhances the seminar program and provides attendees an opportunity to connect with your organizations on a personal level.DSC_0060

Prior to the start of the afternoon sessions, an attendance optional panel discussion was presented by the American Society of Appraisers (ASA), one of ICAP’s four sponsor organizations. The topic: How to Expand your Appraisal Practice. Alternatives to mortgage appraisal assignments were highlighted and included the following disciplines: Gift and estate planning, litigation, property tax appeals, personal property appraisal of machinery and equipment, and corporate valuation services for financial reporting, intellectual property financing, transaction advisory, corporate tax and risk management.

Andrew M. Raucci of Raucci & Sullivan Strategies, LLC was presented an award recognizing his long relationship with ICAP and the many years he spent lobbying the State Legislature on behalf ICAP sponsored bills and issues impacting the appraisal profession. Appropriately, James R. Blaydes, SRA presented Andy the award. Jim, an ICAP past President and Legislative Chair, coordinated with Andy on ICAP legislative issues. Jim donated many years of volunteer service to ICAP diligently working on behalf of Illinois appraisers and the issues impacting the profession.  ICAP extends a heartfelt thank’s to both men.CSC_0213

Kicking off the afternoon, Jack Friedman, PhD presented Advertising and Promotion of Expert Witness Services from an Expert’s Perspective. Mr. Friedman holds BBA, MBA, and PhD degrees and CPA, ABV, MAI, ASA, CRE designations. His company, Jack P. Friedman & Associates, is located in River Forest, Illinois. He can be contacted through his website http://www.realexperts.com. Mr. Friedman provided a wealth of information in a short period of time as to professionally managing your business.DSC_0139

Mr. Friedman posed the question, Of the three things (sell the work, do the work, get paid) to do in your business, which is the easiest? Whether one is an expert witness or promoting professional services in general, Mr. Friedman stated it is necessary to gain visibility, be prepared to respond to any initial engagement request, and anticipate future events which could or does impact your service performance. It is important during the initial conversation to obtain details and resources pertaining to the case at hand including information about the attorney, and be fluent in describing your expert witness experiences. The appraiser must exercise due diligence in a number of areas, including but not limited to: Checking sources, establishing customer terms, availability, fees, inquire what sources referred them to you, resume content, Rule 26, engagement letters, rate sheets for a variety of circumstances, hourly rates based on your experience and education, reducing liability exposure, and the content and information one should include in their business cards, website, et cetera.

Craig Capilla, Attorney with the Franklin Law Group presented “Lessons from Llano ‑ a Review and Reflection on Mass Litigation in the Appraisal Industry. Attorney Capilla’s contact information is via phone at 847‑716‑2380 or via email at ccapilla@charlesfranklinlaw.com.

In 2010 Llano, Texas had a population of 3,232. In 2015 the number of suits filed by Llano exceeds more than the City of Llano’s population. So far multiple lawsuits have been filed in ten States, including Illinois. Forty claims were filed in Cook County, eight remain, in the U.S. Northern District, eight claims were filed, two remain, and in the U.S. Central District 100 claims were filed by First Mutual/Mutual First and 300 were filed by Llano/Carrington.

There is a long string of entities involved in this litigation. They include: PayDirtReit, Heritage Pacific Financial, SAVANT Claims Management (SAVANTLG), Mutual First LLC/First Mutual Group LP, Llano Financing Group, and Impac Funding. Foreclosed properties were purchased for pennies on the dollar and resold at profit, charged off second mortgage loans were bought for pennies on the dollar and collecting on the debts was attempted. Attorney Capilla provided an in‑depth look at the history of the brothers Ganter, who are behind these lawsuits, and the entities involved in the various litigations across the States.DSC_0150

Additionally, Attorney Capilla discussed the Discovery Rule. Illinois is a Discovery Rule state. He offered some answers and guidance to the questions, “How do you attack this problem?” and “What should you do?” Appraisers were strongly urged to contact their insurance company, call an attorney, and if you belong to a professional organization, contact them too.

Presented by Brian Weaver, the “Regulatory Update” session closed ICAPs Lisle 2016 Illinois Appraisers Update Seminar. Mr. Weaver is the Appraisal Coordinator and AMC Coordinator for the Illinois Department of Professional & Financial Regulation.

Illinois is going paperless. Springfield needs an official email address from everyone. They would like two: a personal email and a business email address. A word of caution: Don’t let the State’s emails end up in your spam folder. Eventually every Illinois Appraiser License issued will include your photo on the card. Additional information can be found on the IDFPR website. The online Paperless Licensing Frequently Asked Questions can be found at the following link: http://www.idfpr.com/About/PaperlessFAQ.asp. A new issue of the IDFPR Illinois Appraisal newsletter is scheduled to be published in the fall. Read the most recent newsletter published in June, 2016, and check out previous newsletters online at: http://www.idfpr.com/DRE/ApprNewsletter.asp.

Coordinator Weaver reminded the appraisers in attendance of two mandatory certifications required in appraisal reports. Effective as of June 1, 2015 per Section 1455.245 Scope of Property Conditions Inspections by Real Estate Appraisers requires the following statement, “The comments by the licensed real estate appraiser contained within this appraisal report on the condition of the property do not address “standards of practice” as defined in the Home Inspector License Act [225 ILCS 441] and 68 Ill. Adm. Code 1410 and are not to be considered a home inspection or home inspection report.” Effective April 1, 2013, Section 1455.250 Appraiser Responsibilities as relating to Appraisal Management Companies Section 15‑10 (a) fee disclosure requirement ONLY applies to the AMC client. Read the entire Section 1455.250 online at the following link: http://www.idfpr.com/profs/appraisal.asp.

Coordinator Weaver provided a peek into future of AMCs and what it means for appraisers. The ASC Federal Registry Committee issued potential rules for $25 per panel member registry fee if the panel member completed a covered transaction within the previous 12 months. Coordinator Weaver mentioned there is one AMC which has 66,000 panel members nationwide, 55 jurisdictions will have to send checks to the federal registry, and States will be in a perpetual state of audit. Potential results is the AMCs will be forced to trim their panels, increase their fees to appraisers in order to cover the national registry fee, break up into smaller entities, sell themselves to a bank, or go out of business. The comments ASC received regarding AMC registry fees are posted and can be read at the following website: https://www.regulations.gov/docket?D=ASC‑2016‑0004. The states with AMC enforcement cases include New Mexico, Minnesota, and North Carolina. A word of caution to be informed about your client.

Coordinator Weaver posed the question, What will Illinois need to do to comply with federal AMC regulations? Some things considered are: The need to rewrite the entire Act and Administrative Rules, register every AMC in order to identify who does not fit the federal definition, build or contract to have real-time panel uploads from AMCs, create an audit and compliance team just for AMCs, increase AMC application and renewal fees to cover costs, create a termination bond for the orderly liquidation of an AMCs wanting to close their business, and write an escape clause incase Dodd-Frank is repealed.

DSC_0155

Coordinator Weaver implored appraisers to stop signing indemnity clause statements. These are not for appraisers to sign, but for the vendor to sign. It is a prohibited activity under the Appraisal Management Company Act. Read the entire Prohibited Activities Section. See 225 ILCS 459/165, Section 165 Prohibited Activities (a) (7) (8). The Act can be found at the following link: http://ilga.gov/legislation/ilcs/ilcs2.asp?ChapterID=24 Refresh your memory, review the Appraisal Management Company Rules, specifically the sections covering payment policies and assignment guidelines. The link for these Sections (Sec. 1452.100 and Sec. 1452.120), the entire AMC Act and Rules can be located at: http://www.idfpr.com/profs/apprmanagement.asp. Coordinator Weaver reiterated troublesome issues in his “Stuff I Can’t Believe Still Goes On” portion of his presentation.

For licensing questions contact Mary Bates:
Phone:   317‑785‑9643 or
Email: Mary.Bates@Illinois.gov

For any other question contact Brian Weaver, preferably via email:
Email: Brian.Weaver@Illinois.gov
Phone:   312‑793‑7254

ICAPs wishes to thank all the participants who attended our three Summer Update Seminars held in Collinsville, Springfield, and Lisle, Illinois. This year ICAP rolled out a new on-line survey, we thank all of you who took the time to complete the survey. Your feedback is important to us, and provides feedback as to how we can better serve you, our fellow appraiser professionals. We look forward to continuing to serve you and our collective profession in the years to come.

Hope to see you all next year!
The ICAP Board of Directors

Slider-9

 

ICAP’s 2016 Springfield Seminar ReCAP

July 18, 2016, Abraham Lincoln Doubletree Hotel, Springfield, IL
2016 Illinois Appraisers Update Seminar
by Karen Emerle, SRA
ICAP Reporter & Photographer

Opening the ICAP Springfield 2016 Illinois Appraisers Update Seminar, ICAP President Mike Morris, ARA, MAI, welcomed all attendees. Mike extended a heartfelt thank you for their continued support, attending ICAPs seminars, and for their faithful contributions enabling ICAP to continue its work on behalf of Illinois appraisers and the profession. President Morris presented a brief synopsis of the Coalition’s various accomplishments, the progress made on various legislative bills affecting Illinois appraisers, and provided an overview of ICAPs participation in various local, state, and national issues affecting the Appraisal Profession. The ICAP Advantage newsletter is an exclusive benefit of ICAP membership. The newsletter provides its membership up-to-date status reports on the various issues affecting Illinois appraisers and projects ICAP is working on. ICAP wishes to thank all of our speakers for their participation in ICAPs Springfield 2016 Illinois Appraisers Update Seminar and for providing an exceptionally good day of education to all in attendance. Session highlights from the day follow.

DSCN1097

Scott DiBiasio, Appraisal Institute Manager, State & Industry Affairs, presented the opening session Federal & State Legislative Update. The presentation discussed the state of the Appraisal Profession, the decline in mostly residential appraisers, especially in rural areas, and the factors, such as uncertain business climate, economics, over-regulation, alternative evaluations, and industry demographics, impacting the Profession. The current approach to appraising is the AF’s (Appraisal Foundation) effort to turn appraising into a “cookbook type of science” rather than the art it is and has been. DSCN1105

Mr. DiBiasio discussed the four major statutes specific to appraisers amended by the implementation six years ago of Dodd-Frank. They include: TILA (Truth in Lending Act), FIRREA (Financial Institutions Reform, Recovery and Enforcement Act), ECOA (Equal Credit Opportunity Act), and RESPA (Real Estate Settlement Procedures Act). TILA topics included appraiser independence, reasonable C & R fees, HPMLs (High Priced Mortgage Loans) requirements, and qualified mandatory reporting. FIRREA addressed the Appraiser National Registry fees, AMC minimum requirements and State rules, and ASC policy regarding license reciprocity between States. ECOA includes a provision for the consumer to receive a copy of appraisals and other valuations three days prior to closing.

Mr. DiBiasio also touched on the AMC registry fee for AMC appraiser panels, ICAPs submitted comment letter, appraisal De Minimis threshold levels currently under review, the bank regulators requirement to review regulations every ten (10) years, AVM quality control standard, OCC third party oversight, and the FHA Handbook 4000.1. Additional topics Mr. DiBiaso highlighted are key principles for modernization, federal regulation, State by State portability, uneven playing field, the joint letter by AVOA, AI, NAHB, TAF asking for oversight hearing, SAVE Act and Energy Bill issues, and State issues including evaluations and AO-13, BPOs, appraisal review, and AMC related issues including background checks, recovery funds, and registry fees.

Paul Stoddard presented “Agricultural Land Trends.” Mr. Stoddard is the Lecturer in AGBUS with the Agriculture and Consumer Economics Department at the University of Illinois. Mr. Stoddard can be reached at: pstoddrd@illinois.edu. The TIAA-CREF Center of Farmland Research, the research unit at University of Illinois, Department of Agriculture and Consumer Economics website is: http://farmlandillinois.edu. The University of Illinois Farmdoc website is: http://www.farmdoc.Illinois.edu and the Farmdoc daily website is: http://www.farmdocdaily.Illinois.edu

Characteristics of Farmland as an Investment were outlined. They include, but are not limited to: Relatively expensive, illiquid, and difficult to estimate value. It is location specific and there is very low turnover. The two components of return include cash return and appreciation, which is often the bigger part. Farmers, institutional investors and private parties are the major players in the farmland market. Factors that drive land sales were discussed, including supply and demand expectations, supply factors, demand factors, cash rents, and produce profitability. Mr. Stoddard answered the question, “Why does farmland have value?” An overview of prior years’ as compared to today’s market, and the “normal” relationship between the cap rate and the 10-year T-Note rate were presented.

“Is there a bubble?” Mr. Stoddard compared the common loan terms for a borrower in 1980 to the 2014 terms. Today, many farmers convert variable rate real estate loans to fixed rate loans and crop insurance for farmers/owners can insure both yield and revenues. This has been a game changer in their risk profile of product agriculture. Risks in the agriculture market include major changes in ethanol and energy, cropping patterns, and potential increase in interest rates.

There are two farm bureaus in Illinois, Farm Credit Illinois and 1st Farm Credit. The Farm Credit Illinois covers the southern 60 counties of Illinois, and 1st Farm Credit covers the northern 42 counties of Illinois.

Links to both bureaus are: http://www.farmcreditil.com and https://www.1stfarmcredit.com.

Closing out the morning was “Putting the MLS to work for you with Kristie DeBrun and Cathy Wagner. Mrs. DeBrun is the President of Capital Area Realtors, and Cathy Wagner is the Director of Capital Area REALTORS Multiple Listing Service.

Capital CAR was founded in 1921. It is one of the most progressive in the State of Illinois. Today it covers an eleven (11) county area, including three (3) counties in Galesburg. Membership includes 650 area Realtors and 75 affiliate members. Approximately eleven (11) percent of the members are affiliates. It provides a variety of services including the MLS, and a core benefit feature is the transactions management program. NAR (National Association of Realtors) established that every state and association must meet core standards, and must demonstrate compliance to those standards. CAR merged with Jacksonville and West Central Area. Since June 30, 2015, one-tenth of 157 have been involved in mergers, and consolidation trends will continue in order to compete and keep up with technology. An established agreement with Showing Time is another feature and an efficient way to schedule appointments.

CAR partnered with Clarity Security providing detailed log-in data information and data accuracy. While the MLS facilitates flow of the data, the managing broker has control of their data. Currently sold and closed data to any public portals is not syndicated. RESO (Real Estate Standards Organization) and their Data Dictionary will make use and transmission easier for anybody. According to the RESO website, it is not part of NAR, and was incorporated in 2011. The RETS (Real Standard Transaction Specifications) is “a framework used by real estate industry to facilitate the exchange of data.”

The transaction list, which rolled out six years ago, is offered to all brokers. It developed into digital signature program. One feature or service offered is the auto population of information into forms. The MLS compilation and copyright rules and regulations prohibit providing information to a non-member. Appraisers are provided a 1004MC reporting tool through INNO Via. Additionally, a feature for the appraisal addendum allows the download of MLS data into an Excel spreadsheet. Map based searches enable the user to draw multiple areas on the map at the same time. The transaction desk program allows one to store all one’s documents on line; the storage is unlimited. Any files can then be accessed on one’s phone. DocBox/DocBox2Go. The Authentisign E Signature Tool is not just for brokers; it can be used to sign any document. InfoSparks is a feature of Showing Time 10K Reports. It is inter-active and considered “market trends statistic on steroids.” FastStats, which is not interactive, provides local market updates by region, county, city or tract. And last but not least, RPR for appraisers was highlighted. RPR is a vehicle that allows one to share data with other MLS databases. The advanced feature is a sales comparison analysis. RPR offers online training videos and an RPR Mobile application.

Opening the afternoon sessions was “National Appraisal Issues & Updates” presented by Dennis Badger, Farm Credit Mid-America. Mr. Badger provided attendees with updates on the ASC (Appraisal SubCommittee), AQB (Appraisal Qualifications Board), ASB (Appraisal Standards Board) and the APB (Appraisal Practices Board).

On the pinnacle of this federal pyramid is the ASC, which is the “oversight mechanism” for Appraisal Foundation activities. It has federal oversight of the various State appraiser regulatory agencies. Their current “hot topic” is the perceived shortage of appraisers. Mr. Badger provided a look at the licensee trends from 1992 (65,716) to 2015 (98,351). The highest number (121,407) of licensed appraisers was in 2008. A category comparison between the total number (111,434 vs 97,521) of appraisers for the years 2006 and 2016, respectively, was provided indicating the number of certified general (34,812 vs 39,335), certified residential (46,701 vs 49,995), and licensed (29,921 vs 8,191) appraisers. The FHA and VA require a certified appraiser and they must be certified for three years. Additional topics the ASC is addressing include a unique identifier program, one is being “tested” by several states, the continuity of appraisers’ information, either by different states or appraiser registry, improving information sharing, development of the AMC national registry, the collection and transmission of AMC fees, and the appraisal complaint national hotline. The hotline is meant to be an information resource to help complainants determine the appropriate authority to file their complaint. It is meant for allegations of non-compliance with USPAP and appraiser independence requirements. The hotline does not investigate complaints. A statistical overview of the 2015 hotline contacts received and the identity type (i.e. appraiser, AMC, banker, mortgage broker, real estate agent or consumer) of the person making the contact was presented.

The AQB made changes, effective July 1, 2016, to the Real Property Appraiser Qualifications Criteria. The 3-year supervisory residency requirement was changed and actually reduced the minimum standards. This requirement was amended as it was problematic to appraisers living near state borders or in metropolitan areas covering multiple jurisdictions. The Competency Rule in USPAP already covers geographical area issues. Other areas of the AQB focus are alternative track for licensed residential to become certified, enhanced practicum curriculum, documentation of alternative experience, and the “trainee” nomenclature. In the Springfield geographical area the AQB and ASB will be holding meetings in the next twelve months. The meeting include public comment periods and are free to attend. The next public meeting is scheduled for November 18th in St. Louis. On August 25th a virtual public meeting is scheduled between 1 and 3 PM EST.

ASB issued a new fact sheet “Yes, I can accept that assignment.” It is USPAP flexibility at a glance and helps addresses the question, “What is necessary to help the client achieve their goal.” The document can be found on the AF website under the Appraisal Standards section titled “What are Appraisal Standards?” under the Standards & Qualifications tab. The ASB and IVSC have collaborated on the “draft” or “preliminary” report issue linking the definition of report to when a report is communicated with a signed signature. Caution is in order on this item: beware of State Statutes. The most recent USPAP Q & A was released on July 7th and deals with subject sales history. The two most previous 2016 Q & As issued deal with public trust and appraising two lots as one (March 17th), and the question: “Is turn-around time an assignment condition?” (February 10th).

Craig Capilla, Attorney with the Franklin Law Group presented Lessons from Llano – a Review and Reflection on Mass Litigation in the Appraisal Industry. Attorney Capilla’s contact information is via phone at 847-716-2380 or via email at ccapilla@charlesfranklinlaw.com.

DSCN1131

In 2010 Llano, Texas had a population of 3,232. In 2015 the number of suits filed by Llano exceeds more than the City of Llano’s population. So far multiple lawsuits have been filed in ten States, including Illinois. There is a long string of entities involved in this litigation. They include: PayDirtReit, Heritage Pacific Financial, SAVANT Claims Management (SAVANTLG), Mutual First LLC/First Mutual Group LP, Llano Financing Group, and Impac Funding. Foreclosed properties were purchased for pennies on the dollar and resold at profit, charged off second mortgage loans were bought for pennies on the dollar and collecting on the debts was attempted. Attorney Capilla provided an in-depth look at the history of the brothers Ganter, who are behind these lawsuits, and the entities involved in the various litigations across the States. Additionally, Attorney Capilla discussed the Discovery Rule, Illinois is a Discovery Rule state, and offered some answers and guidance to the questions, “How do you attack this problem? and “What should you do?” Appraisers were strongly urged to contact their insurance company, call an attorney and if you belong to a professional organization, contact them too.

Closing out the seminar, Brian Weaver presented, the “Regulatory Update,” Springfield Edition. Mr. Weaver is the Appraisal Coordinator and AMC Coordinator for the Illinois Department of Professional & Financial Regulation.

DSCN1136

Illinois is going paperless. Future license renewals will be only available on-line. Be sure the State has a current email address; they would prefer two, a business and a personal address. Additional information can be found on the IDFPR website. The online Paperless Licensing Frequently Asked Questions can be found at the following link: http://www.idfpr.com/About/PaperlessFAQ.asp.

Coordinator Weaver provided information regarding current Illinois licensees by category and the in-class and on-line education offerings approved by the State. Education providers who do not update the course IDEC number are pulled from the list until their certificates are updated. The latest newsletter has been published. There to help you in your day to day business, the June 2016 IDFPR Illinois Appraisal newsletter issue include the following topics: Paperless in Illinois, There Go My Brackets, To Eval or Not to Eval, Form Reports Q & A, AMC Fair Housing Mythology, and Experience Log & the Matrix. Read the June 2016 newsletter and check out previous newsletters online at: http://www.idfpr.com/DRE/ApprNewsletter.asp.

Section 1455.245 is one year old. Coordinator Weaver reminded appraisers in attendance that this is a mandatory certification that must be included in all 1-4 family appraisal reports. The certification must be “word for word” as stated in Section 1455.245, effective June 1, 2015, Scope of Property Conditions Inspections by Real Estate Appraisers. The second mandatory certification, which became effective April 1, 2013, addresses the appraiser’s responsibility relating to AMC fee disclosures. This certification ONLY applies to the AMC client and is found in Section 1455.250 Appraiser Responsibilities as relating to Appraisal Management Companies Section 15-10(a). Read both mandatory sections in their entirety, online at the following link, under the Laws & Rules tab: http://www.idfpr.com/profs/appraisal.asp.

Coordinator Weaver’s presentation included his “Stuff I Can’t Believe Still Goes On.” Always entertaining, this section of the presentation is a reminder of troublesome issues still being seen in appraisal reports. A cautionary warning to all appraisers to review their own business practices for any compliance issues to current USPAP and regulations. Some, but not all, issues discussed include: The use of vacant land forms for farms and hunting land, rent forecasting in empty buildings, digital signature caveats, and grammatical vagueness.

For Illinois licensing questions contact Mary Bates at either 317-785-9643 or Mary.Bates@Illinois.gov. For any other question contact Brian Weaver at either 312-793-7254 or Brian.Weaver@Illinois.gov.

ICAPs final 2016 Illinois Appraisers Update Seminar will be held in Lisle, Illinois on August 1, 2016. This year, attending any or all ICAP seminars earns an appraiser 7 hours of CE for each seminar they attend. Follow the link to register for the Lisle seminar: https://icapweb.org/seminars/2016-Lisle.php

Register-Slider

Mid-Year President’s Message

Mid-Year President’s Message
July 12th, 2016
Message from:
Mike Morris, ARA, MAI, 2016 ICAP President

Dear Members of ICAP:

It seems like only yesterday that I took over as President of ICAP. Thankfully, I followed several outstanding leaders that continue to guide and counsel me as we serve the appraisers of Illinois.

The year began with some immediate challenges including budget challenges and our push to get HB 3333 (passed 57-0 in the Senate) through the house and to the Governor’s desk.

  • HB 3333 – We began work on this bill in early 2015 and made it a major focus of our 2015 Lobby Day in Springfield. It easily passed the Senate, but the House was unable to act on it during 2015. The bill establishes an Appraisal Management Company Recovery Fund, which is designed to provide restitution to “each state-certified general real estate appraiser or residential real estate appraiser who has suffered pecuniary loss, and to award to the Department of Financial and Professional Regulation expenses, fines or fees that have gone unpaid to the Department in certain circumstances.”

Currently, AMC’s are required to post a bond to the State that only provides protection to the State and not to appraisers who have unpaid fees. Our bill benefits both the AMC’s and the appraisal profession since once the recovery fund reaches a certain level, AMC’s will no longer be assessed fees until the fund falls below that level. For our profession, we now have a level of protection if an AMC client goes out of business.  The final bill passed the Illinois Senate on May 31, 2016 and was sent to the Governor on June 27, 2016. The Governor has 60 calendars day to sign or veto the bill.

Moving into 2016 we hired a new lobbyist, had our 2nd annual Lobby Day, introduced two additional bills, planned three educational seminars, and provided response letters on pending national issues.

  • ICAP’s bill – HB 5880 prohibits the deduction of any amount from the reasonable and customary fee paid to an appraiser for any costs, fees or other expenses incurred solely by the appraisal management company. The bill passed the House Business & Occupational Licenses Committee with a vote of 10-0 on April 5, 2016 and had a second reading on April 15, 2016 before being sent to the rules committee on April 22, 2016
  • ICAP drafted HB 5881 to ensure that the fee paid to an appraiser is reported separately from the fee paid to the AMC. The purpose of this bill is to require the separation of appraisal and AMC fees on Illinois disclosures to alleviate consumer confusion and increase transparency. The last action on this bill was April 8, 2016 when it was returned to the Rules Committee.
  • IDFPR Turnaround Town Hall Meeting – ICAP was invited, along with other professions, to send two representatives to this meeting. Prior to the meeting, we collected your feedback with a membership survey for discussion at the meeting. The issues of appraiser independence and customary and reasonable fees were clearly on the mind of our membership. Our formal questions to the Department were: “What steps has it taken (or is planning to take) to ensure that appraisal management companies comply with the appraisal independence standards?” and “What steps had the Department taken (or is it planning to take) to conduct a survey of fees for appraisal services?” We are continuing to work with the Department to ensure appraiser independence and to complete a fee study for appraisers in Illinois.
  • 2016 Lobby Day – On May 4, 2016 a group of ICAP members and board members made the trek to Springfield for our 2nd annual Lobby Day. We kicked off the day with a legislative briefing and met with the new IDFPR Director, Kreg Allison, as well as Kari Selinger (IDFPR – Director’s Office), Brian Weaver and Mary Bates. After our meeting, we spent the afternoon on a Capitol tour and meetings with individual senators and representatives to promote our legislation.
  • 1st Annual Golf Outing – On May 19th ICAP held our inaugural golf outing at the Gleneagles Country Club in Lemont. The outing drew over 50 golfers for an outstanding day of golf, food and fun.
  • Appraisal Threshold Issue – We provided written comments to the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation stating, “there is no evidence that raising the appraisal threshold would increase the safety and soundness of real estate lending practices.” ICAP recommended that the Agencies “continue to operate with consumer protection as its prime directive and urged the agencies to resist any calls to increase the appraisal threshold.”
  • Potential Changes to the Appraisal Qualifications Board (AQB) Criteria – ICAP surveyed our membership, developed a position paper and provided a formal written response to the AQB. Members can view our response to the AQB on the ICAP website.
  • USPAP 2018-2019 1st Exposure Draft – As with the AQB criteria, we studied the proposed changes to the next version of USPAP and provided a formal written response.
  • Changes to the FHA Handbook – During our June 9 ICAP board meeting, we met with Heidi Henning, Managing Director – Business Specialties, for the National Association of Realtors (NAR) to foster and promote our profession. NAR is reporting that recent changes to the FHA handbook on appraisals (requiring appraisers to take on home inspection-type duties) is leading some consumers to mistake the role of appraisers with that of home inspectors. ICAP completed a survey prior to the meeting, receiving over 1,000 responses on the topic. We reported our survey results and recommendations to Ms. Henning and will continue to work with NAR to ensure these issues are addressed and clarified.
  • Seminars – As of this writing, we have completed one of the three, scheduled seminars. We had a record turnout for the Collinsville seminar on June 13 to hear an outstanding group of speakers. The Springfield and Lisle seminars are coming up, and we have an outstanding group of speakers lined up for those events.

So far 2016 has been a very busy year for ICAP, and I appreciate the support of our members, the feedback on the surveys and the outstanding board of directors. Working with incredible people who are not afraid of a challenge has made my job as president very rewarding.

Mike Morris, ARA, MAI
2016 ICAP President

ICAP’s Lisle Seminar Registration

ICAP’s Lisle Seminar Is Now Approved For 7 Hours Of CE In Illinois, Michigan, Missouri & Wisconsin & 3.5 hours of Indiana State Credit.

Non-Member pricing includes a pro-rated ICAP membership for the remainder of 2016.

Click here to register, don’t delay…reserve your space today.

Date:
August 1, 2016

Location:
Lisle Sheraton Hotel
3000 Warrenville Road

Start:
8:00am-8:30am – Registration and Continental Breakfast

Includes a continental breakfast during the morning exhibitor hour and a hot lunch featuring a salad, entrée, and dessert lunch during the afternoon exhibitor hour.

Crowd raffles and giveaways.

Welcome & Introduction from 2016 ICAP President, Mike Morris, ARA, MAI and an afternoon ice-cream networking break.

Start:
8:00am-8:30am – Registration and Continental Breakfast

Includes a continental breakfast during the morning exhibitor hour and a hot lunch featuring a salad, entrée, and dessert lunch during the afternoon exhibitor hour.

photo-9

 

Crowd raffles and giveaways.

 

Welcome & Introduction from 2016 ICAP President, Mike Morris, ARA, MAI and an afternoon ice-cream networking break.

Brian Weaver, Appraisal Coordinator & AMC Coordinator, Illinois Department of Professional & Financial Regulation.
Register-Slider

ICAP’s 2016 Collinsville Seminar Summary

2016 Illinois Appraisers Update Seminar

June 13, 2016, Doubletree Hotel, Collinsville, IL

by Karen Emerle, SRA

ICAP Reporter & Photographer

ICAP President Mike Morris, ARA, MAI welcomed all attendees to the first of ICAP’s three 2016 Appraiser Update seminars. Mike enumerated ICAPs accomplishments on behalf of Illinois appraisers and outlined ICAP’s various participation in the local, state, and national issues affecting the appraisal profession.DSCN9901

ICAP’s Bill (HB3333) passed the Illinois House of Representatives on May 31, 2016. Drafted by ICAP and sponsored by Representative Robert Rita of Illinois 28th District, the Bill amends Illinois Appraisal Management Company Registration Act to create an Appraisal Management Company Recovery Fund. This Bill will make it possible for appraisers to collect payment from Appraisal Management Companies (AMC) that declare bankruptcy. The Bill will be sent to the Governor for signature within 30 days. The Governor will have 60 days to sign the bill or return it with a veto. Mike urged all appraisers to support this Bill by sending comments to the Governor in favor of the Bill.

ICAP submitted comments to the Appraiser Qualifications Board (AQB) and the Appraisal Standards Board (ASB) in response to the AQB’s First Exposure Draft of Proposed Changes to the Real Property Appraiser Qualifications Criteria and the ASB’s First Exposure Draft of Proposed Changes for the 2018-19 edition of the Uniform Standards of Professional Appraisal Practice. ICAP is working with NAR to seek remedies and address those issues arising from the new FHA Single Family Handbook. The Handbook became effective September 14, 2014 and was revised March 14, 2016. The ICAP Advantage newsletter is an exclusive benefit of ICAP membership. The Newsletter provides ICAP membership updates on the various issues affecting Illinois appraisers and on ICAP’s continuing work on behalf of Illinois appraisers.

Mike extended a heartfelt thank you to the ICAP membership for attending ICAPs seminars and faithful contributions, and to the many Board members and committee members who volunteer their time working hard on behalf of the appraisal profession.

Statistics & the Appraisal Process, the opening session, was presented by John Urubek, MAI, CCIM. Mr. Urubek commented that the Ainternet is here to stay. Click on it and someone is collecting your data. Sooner or later it becomes a statistic. The presentations purpose is to encourage more use of statistics in your day to day appraisal practice, to expand your skill sets and experience by applying what you learn, and explain how to use creative ways to create more credible reports.

To solve the problem with confidence one needs a larger sample size. The focus of the talk is the applications of statistics in real world appraisal problems. Mr Urubek asked the question, Should I use statistics in my appraisal? A The answer is Yes. According to Wikipedia the history of statistics can be traced back to 1749. Appraisals refer to probability. USPAP SR1-1(a) states an appraiser must: be aware of, understand, and correctly employ those recognized methods and techniques that are necessary to produce a credible appraisal.

Through the use of four examples, Mr. Urubek provided creative and practical ways to use statistics in the appraisal process. Definitions of Descriptive and inferential statistics were presented. Examples included questions such as, A How do you do an appraisal with no sales for over six years? There was a lively discussion around Example 2, which posed the question, Can a scatter plot be used to produce a credible prediction of price? This provided a good example of an improper assumption and the improper use of statistics. Example 3 provided insight into R Squared, polynomial function and economies of scale. Example 4 asked the question, Is paired data analysis still a viable tool? Today we have a wealth of information provided by MLS databases, assessor offices and other private data providers. Mr. Urubek closed his presentation by reminding attendees that an appraisal must adhere to accepted appraisal principles, USPAP, laws and regulations, and assignment conditions.

Screen Shot 2016-06-28 at 10.05.33 PM

Mr. Urubek can be reached at phone 708-557-3662 or by email at jurubek@aol.com. For those in attendance interested in learning more about statistics, Mr. Urubek will be teaching the class, Interpretation and Application of Simple Linear Regression on July 7-8, 2016. Register at: http://www.ccai.org/chicago‑courses.php

Carolyn Payne, presented The Anatomy of an Engagement Letter.A Mrs. Payne is the Assistant General Counsel for 1st Farm Credit Services. She can be reached by phone at 309-268-0346 or email at cpayne@1stfarmcredit.com.

Attendees learned the purposes of engagement letters and were provided a sample copy for edification. Utilization of an engagement letter will reduce liability, forms a contract between the appraiser and the client, outlines the services to be rendered, and specifies the type of communication to be used. Why do you need one? The use of an engagement letter allows the appraiser to control the assignment, provides expectation details such as what the appraiser is going to do and how the appraiser is getting paid, helps avoid litigation and provides contract privity.

Mrs. Payne’s presentation addressed the ingredients that should be included in an engagement and the relationship to USPAP Standard Rules 1 and 2. The type of report being prepared for the client should be put in writing. The intended use, users and type of value should be identified. It is important to describe the type of property interest being appraised, understand the interest and the current ownership and any future ownership of the client. Extraordinary assumptions and/or hypothetical conditions, if known, scope of work including what you cannot do should be included in the engagement letter.DSCN9904

The engagement letter sets the compensation terms for the current appraisal and outlines terms for any future work. The law provides a $15 or $25 check if one is subpoenaed to testify. In case this should occur, it is best practices to get your witness fee stated in the engagement letter. The engagement letter can also provide protection for work already done. It helps to manage client expectations by providing the timing and method of delivery. Helpful language that can be incorporated into an engagement letter can cover advertising restrictions, third-party beneficiaries, and future appraisals on the property. The engagement letter should include two signatures, the client and the appraiser. Best practices for binding electronic signatures would be to follow E-Sign. Doc-U Sign complies with E-Sign.

In closing, Mrs. Payne reminded attendees that an engagement letter is an important tool in their toolkit. It helps prevent potential litigation, helps in the collection of fees, places potential limits on liability, and reduces exposure to free deposition / court appearances or the $25 court fees.

The afternoon session started with Preparing Appraisers for the Witness Stand with Bill Broom from the Law Firm of Barrett, Twomey, Broom, Hughes & Hoke, LLP. Mr. Broom can be reached at 618-457-0473

There are a variety of situations that could involve an appraiser as an expert witness: Dissolutions of marriage, estates, tax appeals, eminent domain. Mr. Broom advised us to keep in mind the following questions: Is there any chance you will end up as an expert witness in this assignment? In answer to the question, Does your methodology change? Mr. Broom’s stated advice is, No, just take more pictures.

Mr. Brooms expertise and thorough presentation included discussion and examples of the Supreme Court Rule 213, the three types of opinion witnesses, Hearsay Evidence Rule, photographs, technology, Evidence and Discovery Depositions, and rules for witnesses in a deposition. The Supreme Court Rule 213 is full disclosure and governs all opinions and basis of opinions. Opinion witnesses include the lay witness, the independent expert witness, and controlled expert witness. Important in zoning matters is the Hearsay Evidence Rule which as a general rule says one cannot testify as to what someone else has done. Evidence and discovery depositions are serious business. They are not friendly conversations. Mr. Broom outlined basic protocol for deposition witnesses, what to do and how to act and/or respond during the process.

Hot Topics & Myths in Appraiser Liability, presented by Peter Christensen, General Counsel at LIA Administrators & Insurance Services. Contact Mr. Christensen at 800-334-0652.  Three things LIA helps appraisers with are complaints to State Boards, demand letters and being sued. Mr. Christensen spoke about the current liability conditions. Most appraisers get sued by the largest national firms. In general, liability for appraisers is not out of control. In Australia, for example, the mom and pop appraisal firms are gone. Appraisals for lending purposes are only done by the large appraisal firms due largely to the huge liability insurance premiums. A typical annual premium is $27,000 with a $50,000 per claim deductible. Mr. Christensen described the variety of legal claims made, which could include elements of professional negligence, negligent misrepresentation, fraud and/or conspiracy, libel and/or defamation, and breach of contract.

DSCN9918

Providing examples of actual cases, Mr. Christensen discussed the following questions. “Who can sue an appraiser? Whom does the appraiser owe a legal duty? In most states a professional may be liable to third parties. What can you do? Mr. Christensen reminded appraisers to explicitly clarify the intended user/use. The clarification should be kept as narrow as it can practically be done. Appraisers in attendance were also encouraged to use plain English to disclose any appraisal property issues.

Statute of Limitations, anyone? Is it a myth that an appraiser cannot be sued for an appraisal completed more than five years ago? Yes. States have their own laws and they may have no relationship to the USPAP five-year record keeping requirement. The Illinois Statute is vague due to the Discovery Rule. Mr. Christensen suggests keeping work files for at least 10 years, and at least, as a bare minimum, the appraisal report.

Mr. Christensen spoke about the emerging Mass Litigation Problem Involving Appraisers. Basically, it involves litigation investors suing appraisers for profit. The suits present cookie cutter allegations of negligence. Sometimes a cookie cutter review is attached. Often the allegations are obviously flawed. There have been 450 plus cases overall for the 2014-2016 period. So far the entities have sued a total of 600 plus appraisers in Florida, Illinois, New Jersey and Las Vegas. Mr. Christensen advised any appraisers who might be sued to not ignore it, get some help, report it to your E & O, get legal assistance, and if you are served to handle the lawsuit appropriately.

Some common reasons as to why appraisers, under their E & O policy don=t have coverage for a claim were described. They include the absence of tail coverage, prior acts or retroactive date on the appraisers E & O policy that does not cover time when the appraisal was performed, and claims made insurance. The retroactive date should be as far back as one has had a policy. If one switches insurance companies, the retroactive date is the current date. Retirement tail coverage endorsement would provide coverage for the rest of life into sunset.

What are some hot topics in claims? Mr. Christensen said the number one claim issue after a pure value claim is square footage claims. He reminded appraisers to get the measurement right, double check calculations and sketches, proof for any typos, and to not trust the borrower, sellers, MLS, or public records. Hot topic number 2 is septic tanks. The appraiser report stated the subject property was served by a sewer when in fact it was served by a septic tank. This error in reports is commonly caused by using template reports, blindly relying on the MLS, and an actual in field error. Mr. Christensen reminded attendees when there is doubt or special issues, disclose.

Presented by Brian Weaver, the Regulation Update session closed ICAPs Collinsville 2016 Illinois Appraisers Update Seminar. Mr. Weaver is the Appraisal Coordinator and AMC Coordinator for the Illinois Department of Professional & Financial Regulation.

Illinois is going paperless. Springfield needs an official email address from everyone. They would like two: a personal email and a business email address. A word of caution: Do not let the States= emails end up in your spam folder. Eventually every Illinois Appraiser License issued will include the appraiser’s photo on the card. Additional information can be found on the IDFPR website. The online Paperless Licensing Frequently Asked Questions can be found at the following link: http://www.idfpr.com/About/PaperlessFAQ.asp

Have you completed all your continuing education hours? If not, you will not be able to renew your license. There are currently 362 approved Illinois appraiser education courses; 233 in-class and 129 on-line courses. All on-line courses must have an IDECC certificate. A reminder, in Illinois it is required the USPAP update course must be completed by June 30, 2016. The Administrative Rules, Title 68, Section 1455.160 Continuing Education is available online at the IDFPR website link: http://www.idfpr.com/profs/appraisal.asp

The June 2016 IDFPR Illinois Appraiser newsletter has been published. The Department plans to send future newsletters directly to you. Read the June 2016 newsletter and check out previous newsletters online at: http://www.idfpr.com/DRE/ApprNewsletter.asp. Topics covered in the latest Issue include Paperless in Illinois, There Go My Brackets, To Eval or Not to Eval, Form Reports Q & A, AMC Fair Housing Mythology, and Experience Log & the Matrix.

Mr. Weaver reminded the appraisers in attendance of two mandatory certifications required in appraisal reports. Effective as of June 1, 2015 per Section 1455.245 Scope of Property Conditions Inspections by Real Estate Appraisers requires the following statement, “The comments by the licensed real estate appraiser contained within this appraisal report on the condition of the property do not address “standards of practice” as defined in the Home Inspector License Act [225 ILCS 441] and 68 Ill. Adm. Code 1410 and are not to be considered a home inspection or home inspection report.” Effective April 1, 2013, Section 1455.250 Appraiser Responsibilities as relating to Appraisal Management Companies Section 15-10(a) fee disclosure requirement ONLY applies to the AMC client. Read the entire Section 1455.250 online at the following link: http://www.idfpr.com/profs/appraisal.asp.

The USPAP record keeping rule includes a five-year retention minimum. Illinois is not clear as to the five-year statute of limitations. The date of discovery question still exists.

Mr. Weaver outlined troublesome issues in his Stuff I Can’t Believe Still Goes On portion of his presentation.

  • Farms and hunting land being reported on vacant land forms.
  • Certified Residential appraisers appraising agricultural land all by themselves. This is beyond the scope of their license.
  • Non-appraisers appraising anything.
  • Forecasting rents in empty buildings in order to forecast market rent for a subject property.
  • Invoking departure.
  • Caveats for digital signatures.
  • Appraisers clearing conditions when they are not cleared or finished.
  • Wordsmith those reports. For example, appears to be in order.What order? Numerical? Alphabetical?

SR 1-5 (a) requires an appraiser to Aanalyze all agreements of sale. Mr. Weaver suggested appraisers consider the following questions in their research. “Is the contract signed by all parties? Does the contract include all the pages? Are there any blanks? Were changes initiated and initialed? What riders were included? Were there any concessions? Does the contract look fishy?

Working with cost approach. Extraction is a method of estimating land value in which the depreciated cost of improvements is deducted from the total sale price of the property to arrive at the land value. It is most effective when improvements contribute little to the total sale price of the property. Questions raised include, “Are you leaving the as is site line blank? What about sidewalks, driveways?” A word of caution to those utilizing the building-cost.net website for developing a cost approach.

For licensing questions contact Mary Bates:

Phone:   317-785-9643 or

Email: Mary.Bates@Illinois.gov

For any other question contact Brian Weaver:

Phone:   312-793-7254

Email:   Brian.Weaver@Illinois.gov

ICAPs final two 2016 Illinois Appraisers Update Seminar are schedule for July 18th in Springfield and August 1st in Lisle.

Register-Slider

 

%d bloggers like this: