Category Archives: ICAP and Congress
Herb Meyer, ARA – ICAP Director reports on the Collinsville ICAP Seminar held on June 12th at the Doubletree Hotel.
Ted Neff (ICAP Director) opened the day with a brief welcome and an introduction of Thomas Kneesel, SRA.
Chief Appraiser for Associated Bank
Collateral Underwriter from a Reviewers Perspective – Fannie Mae Approved Presentation
- CU as just one of several appraisal review tools
- Since implementation at Associated Bank, the number of appraisal resubmits for has now returned to 30%, same rate as pre-Collateral Underwriting
- The 15 and 25 percent net and gross adjustment rules have been officially removed
- Underwriters no longer consider fewer and smaller adjustments as a better appraisal
- A surprising amount of disparity between appraisers found in appraisal reports for square footage and room adjustments. Also in ratings such as quality of construction and condition. For example, different appraiser condition ratings for the same sale can range from C2 to C4.
- OCC is auditing banks to determine if the AMC’s are paying customary and reasonable fees. Tom indicated that it is the OCC’s duty (and other regulators) to complete these audits under Dodd Frank.
- Fannie Mae indicated that the reasons for appraisers being placed in a watch list have to do with some non-appraisal issues. One example was an appraiser that signs 200+/- appraisals per month and indicates in every appraisal that they physically inspected all of the properties that cover a 200 mile radius from the office.
Keith Wolf, SRA, AI-RRS.
Statistics: Gambling with your License
- Several AMV’s and other statistic providers were discussed
- Computer based statistical programs could support better and worse adjustments. The appraiser has to be responsibility to understanding how the programs work and how to make the adjustments meaningful.
- Focused around Standard 6 being Mass Appraisal and also Advisory Opinion 6 on Comparable Sales. Discussed confounding data and confidence ratings.
- Wolf indicated that the banks are charged with determining customary and reasonable fees by the Dodd Frank Law. He spoke briefly about the AMC that was recently charged with not paying customary and reasonable fees in Louisiana.
IL Program Director, USDA
Overview of USDA for Residential Appraisers
- FmHA’s need for appraisers to prepare appraisals for their loan programs including direct loans and loan guarantees for rural residential properties and houses in towns of low population.
- Covered topics regarding requirements in appraisals for the different types of loan products available from the Rural Development division of the USDA.
- Discussed the required components of the home inspection that the appraiser must complete and the requirements for licensed home inspectors.
- The water well inspections and when a borrower is required to connect to available public water and sewer. The water and septic inspections are dependent upon available procedures in each community.
- Mr. Ramsey is seeking appraisers for some highly specialized appraisals on subsidized multi-family residential projects. These properties have interest rate subsidies, extreme long loan amortizations and rental rate controls. They are typically senior housing and other low rent restricted properties where the rent is a percent of the occupant’s income.
Realtor and Owner of Your Home Team Real Estate
IAR Update on Southern Illinois Market Conditions
- Discussed the local housing market and the relationship between Realtors and Appraisers.
- Encouraged appraisers to talk with realtors and know what they can talk about
- Questions the appraiser can expect and don’t take it personal
ICAP’s Compliance Issues on Residential Appraisals
- Discussed Appraiser Compliance
- Appraisers should clean up templates and have multiple templates for various assignment types
- Reminded appraisers of requirement to report the appraisal fee in the report and explained how it helps banks and lenders understand the AMC fee structure
ICAP’s 2015 Lobby Day, Capitol Visit & Reception
Free for ICAP Members
Illinois Real Estate Appraisers will gather in Springfield on May 6th for an ICAP Lobby Day.
Includes lunch & appetizer reception.
Support ICAP’s proposed legislation, HB2664, which would amend the Appraisal Management Company Registration Act providing for an Appraisal Management Company Recovery Fund, and HB3333 which would amend the Real Estate License Act of 2000 allowing Appraisers who hold a brokers license to perform Broker Price Opinions. Talk directly with your legislators about issues that affect the real estate business!
ICAP will establish an “appraiser presence” in Springfield Illinois in an organized effort lead by our lobbyist Andy Raucci. Participants will lobby our states Capitol demonstrating that Illinois appraisal profession made up of professionals who recognize the importance of being actively involved in the political process.
|11:00 a.m. – 11:45 a.m.||Registration|
|11:45 a.m. – 12:45 p.m.||Legislative Briefing & Lunch|
|1:00 a.m. – 1:30 p.m.||Capital Tour|
|1:30 a.m. – 4:00 p.m.||Capitol Visits|
|4:00 p.m. – 4:30 p.m.||Capitol Photograph|
|4:30 p.m. – 6:00 p.m.||Reception|
ICAP 2014 Illinois Appraisers Update Seminar – Lisle
August 18, 2014
Lisle Sheraton Hotel, Lisle, Illinois provided the great venue we’ve come to expect each year for ICAPs 2014 Illinois Appraisers Update Seminar. On August 18, 2014, 303 professionals participated, making ICAPs 14th annual Lisle seminar another success. The morning started with registration, fresh fruit, breakfast sandwiches, and an opportunity to meet with exhibitors. A special thanks to the exhibitors this year and their efforts to help make this year’s Lisle seminar excel.
Rick Hilton, IFSA, 2014 ICAP Vice President and our host for the day, opened the seminar with a warm welcome to participants, thanking them for their support and attendance. Throughout the day Rick provided brief introductions for the seminar speakers, in order of schedule: Rich deVerdier, 2014 ICAP President, Ron DeVries, Barton DeLacy, Jim Blaydes, TJ McCarthy, John Brenan, John Torvi, Charlie Franklin, and Brian Weaver. Rich deVerdier, MAI, SRA, AI-GRS started the morning session thanking the exhibitors and presenters. He briefly explained a recent legislative victory with HB5709 and announced ICAP’s new Supervisor/Trainee Seminar offering. After a wonderful lunch, representatives from the vendor showcase were given an opportunity to address the seminar with a brief introduction of their services. Rich deVerdier was presented a plaque of appreciation for his service as ICAP 2014 President. Additionally all attendees participated in a drawing conducted by Rick. Vendor representatives presented winners with gifts donated by each respective vendor. The final opportunity to take advantage of the vendor showcase was during the afternoon break and Ice Cream Social, always a Lisle favorite.
Ron DeVries, MAI, SRA started out the morning session with a presentation on Multi Family Chicagoland. Ron started out with an overview of the Chicago and suburban market and compared it to trends nationally. He then presented an analysis of over 90,000 units in 10 different Chicago markets. Bottom line, the Chicago multi-unit residential market is recovering and projecting and even stronger 2015. True to his form, Ron not only presented the material, but also educated his audience on analyzing the multi-unit residential market, including; market indicators, market segmentation, and building classifications.
Barton DeLacy, MAI, CRE, FRICS, ICAP 2014 Secretary next encouraged appraisers to Grow you Practice – a Primer on Valuation Consulting. Barton suggested we look “inside the box” and exploit what we do already offer beyond just values. Furthermore, appraisers should look beyond appraisals for financial institutions and look towards consulting. Appraisers are trained to offer opinions that are competent, independent, impartial, and objective. “Imagine an appraisal, but without a value.” Consulting can be for only for a portion of the appraisal and not include an opinion of value. Barton particularly urged residential appraisers to explore this space, including litigation support, impact studies, market rent analyses, property tax consulting, and due diligence (prior to sale). Diversifying your business with consulting services will not only increase your production, but also your bottom line.
Jim Blaydes, SRA, Illinois Real Estate Appraisal Licensing Board Member, discussed Illinois Legislation Issues. He first took the opportunity to give a lesson on the legislative process in Illinois. Essentially, 1) Bill is Drafted (House or Senate), 2) Bill is Introduced into originating Chamber, 3) Bill is Referred to Committee, 4) Committee Hearing, 5) 2nd Reading, 6), 3rd Reading, 7) Sent to 2nd Chamber (approval or sent back to original Chamber), 8) If approved sent to Governor (sign or veto), 9) New Law. Jim then explained some of the legislative actions that ICAP has been involved with in 2014, including SB1841 and SB3044. Jim also explained ICAP’s involvement in helping to write the proposed language for the administrative rules for the AMC Act.
TJ McCarthy, SRA provided insight into some of the latest Fannie Mae activities. One area of particular interest for appraisers was the FM Appraiser Quality Monitoring Program. The program can place appraisers on a list that would require their appraisals to be subject to 100% review or a list of appraisers whose appraisals are no longer accepted by Fannie Mae. TJ also encouraged appraisers to read through Fannie Mae letter LL-2014-02: Property and Appraisal Requirements for Properties Located in Small Towns and Rural Areas. He suggested there is quotable text in the letter for appraisers working in rural parts of Illinois. He also explained more about the Supervisor and Trainee Requirements in Illinois related to the new required course.
After lunch, John Brenan, Director of Appraisal Issues for the Appraisal Foundation, provided an overview on the Appraisal Foundation (AF). The AF has nine appraisal sponsors, three affiliate sponsors, and one international sponsor. It is comprised of four Boards: The Appraisal Quality Board (AQB), the Appraisal Practices Board (APB), the Appraisal Standards Board (ASB), and the Board of Trustees which has oversight responsibility for the operations of the AF. There are also three advisory councils: The Appraisal Foundation Advisory Council (TAFAC), the Industry Advisory Council (IAC), and Valuers Global Forum (VGF).
Projects the APB have been working on include, but are not limited to: Collection and Verification of Residential Sales Data in the Sales Comparison Approach, Collection and Verification of Data used in the Sales Comparison Approach for Non-Residential Properties, Valuation Issues in Separating Tangible and Intangible Assets, Identification of Contributory Assets and Calculation of Economic Rents.
Notable initiatives include the partnership with Association of Appraiser Regulatory Officials (AARO) and the ASC which includes the investigator training courses, a five-year memorandum of understanding with the U.S. Department of Energy on Valuation of Green Buildings, creation of Alliance for Valuation Education, eLibrary and new courses development, creation of webinars, brochures and YouTube videos, and consistent USPAP enforcement. APB intends to look at the existing methods and techniques and develop an abstract for education.
John stated that out of approximately 85,000 appraisers nationwide, the AF only receives 30 to 35 respond to the various exposure drafts issued by the Boards. He stressed the importance of appraisers responding to requests for public. All comments are read by all members of the applicable board. For information on any of these topics please visit the AF at appraisalfoundation.org. Mr. Brenan can be contacted at email@example.com.
John Torvi, Landy Insurance Agency and Charles Franklin, Franklin Law Group discussed Buy Back Claims made against appraisers and their Errors and Omissions (E&O) Insurance. It is not surprise that one of the top two E&O insurance claims is by primary loan originators for overvaluation after a loan defaults. John explained what he is seeing related to E&O claims. He strongly urged appraisers to read and understand their E&O Insurance as a risk management tool. Charles explained what they are seeing related to defending against these claims. He described the litigation process and options the appraiser may or may not have related to their defense. As usual, Charles baffled the audience with stories of real court cases.
Brian Weaver, Illinois Coordinator, presented Legislative Updates. During 2014 the Division of Real Estate was created, SB3044 passed, criminal background checks begin January 2015, and there were member changes to the Appraisal Advisory Board. The Illinois Governor signed an Executive Order on March 31, 2014 creating the Division of Real Estate resulting in a structural change and creating a Director of Real Estate. The Appraiser Act was amended through SB3044 to comply with the AQB criteria. Effective January 1, 2015, background checks for new licensees will be required. Other changes included in SB3044 pertain to BPOs and waiver valuations. The newest member appointed to the Illinois Real Estate Appraisal Licensing Board is Peter Poulos, MAI. Retiring from the Board is Timothy J McCarthy, SRA. Currently, there are 4,427 Illinois appraisers: 515 Trainees (94% in IL), 2,452 Certified Residential (91% in IL), and 1,460 Certified General (73% in IL). Brian gave a One Year Later status of AMC’s in Illinois. There are currently 189 AMC’s registered in Illinois. Since August 2013, approximately a dozen licensed AMCs have closed. Brian anticipates the total number of AMC’s in Illinois will either stay relatively the same or decrease as more AMCs leaving the business. Brian shared some interesting results of a survey sent to all registered AMC’s in Illinois related to an AMC Compliance Audit. Brian ended by stating the best way to contact himself or Mary Bates is by email, firstname.lastname@example.org and email@example.com.
~~~Ken Mrozek, MAI, SRA
Effective legislative relations require getting to know your State Representatives. This is why ICAP Directors Brian Masterson and David L. DuBois, MAI recently attended a fundraising event for Representative Marcus C. Evans, Jr. (D) 33rd District.
Marcus was previously the Deputy Chief of Staff for City of Chicago Alderman Michelle A. Harris of the 8th Ward. Recent Committee assignments include: Business Occupational Licenses (Vice-Chairperson); Consumer Protection; Revenue & Finance; Finance Subcommittee, and Business Licenses Subcommittee.
ICAP’s Political Action Fund collects contributions from members and uses those funds to help elect candidates for public office who are supportive of appraiser related issues.
Your annual membership dues are essential to ICAP remaining a strong political activist for appraisers in the State of Illinois. Thank you for your continued support and please do not forget to donate to ICAP’s PAC this year when you renew your membership.
LEGISLATIVE ALERT – Call Your State Representative IMMEDIATELY and urge them to vote NO for Senate Bill SB3237 –Real Estate Appraisal Waiver
Your help is urgently needed. Please contact your State Representative and ask them to vote NO on Senate Bill SB3237. This amendment to the Illinois Real Estate Appraisal Act provides that a license is not required to perform valuations if the valuations are performed by an employee of a municipality if the valuation is in an amount not to exceed $10,000 and meets other specified conditions. This would be effective immediately.
To read more about the bill click:
The specific committee members we are trying to reach could be found at the following link: http://www.ilga.gov/house/committees/members.asp?CommitteeID=961&GA=97
If you need assistance locating your State Representative, click on the following link:
When the page opens enter your home address. Click on the name of your State Representative. You will be directed to a page with their contact information.
Here is a possible script that you can use when calling or emailing your elected representative:
ICAP (IL coalition appraiser professionals) represents all most half of the certified appraisers in Illinois
We oppose the proposed amendment SB3237
The IL Appraisal Board also opposes this amendment
We have concerns with non-certified appraisers filling out the waiver valuation forms, they are appraisals.
Currently, the state statue says you must be a state certified appraiser to complete appraisals on federally related transactions.
The waiver valuations require an estimate of market value, H & B use analysis, and estimate of damages. To determine if any damages are created, must appraise the entire property before the proposed take, and after the proposed take to see if there are any differences.
THIS IS AN APPRAISAL
Our state stature currently does not even permit an appraiser trainee to develop an opinion of market value on a $10,000 vacant lot …………..why should an employee of the municipally be permitted to do this ?
The waiver valuations are completed and offers are made to the consumers’ to purchase their property, they need to be completed by certified appraisers to protect the consumer…………….it is the law
Please call your State Representative immediately and ask them not to support Senate Bill SB3237.
If you have any questions please email or call Jim Blaydes, SRA @ firstname.lastname@example.org or 815.223.1110
CONTACT YOUR STATE REP NOW!!!