AP Weekly Poll Analysis – Collateral Underwriter

on July 1 | in Featured Story, Newsletter, Polls | by | with Comments Off on AP Weekly Poll Analysis – Collateral Underwriter

Before jumping into the poll content this month, I want to advise you about something concerning the viewing of polls on the AppraisalPort website. Some appraisers mentioned that at times the poll can obstruct the log-in and other important parts of the AP home page. If this ever happens to you, check the zoom level on your browser. It should be set to 100% or less. If it is set over 100%, it causes the poll pop-up to fill more screen area and obscure parts of the home page you may need for navigation. The poll should never obstruct your ability to log-in and get right to work!

This month I want to discuss three recent polls dealing with Fannie Mae’s recent release of their Collateral Underwriter Tool (CU) for use by lenders. In the first poll we asked “Have you been asked to make any appraisal changes/corrections due specifically from your lender/client using Fannie Mae’s CU tool?” This poll had 3197 responses and well over half the appraisers (60 percent) answered “No”. Another 28 percent said “Yes” they had received appraisals back due to issues directly related to their lender using CU. A final 12 percent were not sure. That makes sense, because some lenders may not mention what program generated the issue. From what I hear, some lenders may have been a bit overzealous in sending appraisals back when first starting to use CU. My guess is that appraisers are getting fewer appraisals returned now that we are a few months into using the new system and lenders are getting a handle on what issues really merit a returned appraisal.

In the next poll we asked: “With lenders now using Fannie Mae’s CU, how are you showing support for your adjustments?” This poll was very popular with 4054 responses. As you may have heard, one of the things Fannie Mae is really watching for is how the appraiser arrived at the adjustment numbers. The more support the appraiser can supply for the numbers, the less likely an appraisal will be returned for questionable adjustment amounts. The first two answers scored closely and many may consider them to be the same thing. The winner was “Estimating from market data” with 36 percent of the vote followed closely by “Paired data analysis” with 32 percent. The third most popular answer was a bit of a surprise, with 19 percent selecting “I’m not!” (showing any support for adjustments). Commercially available regression programs don’t seem to have a lot of use, at least so far. Using “Multiple regression analysis through Excel” captured 3 percent of the vote and was tied with “Using a regression modeling program supplied by a vendor”. A lot of vendors in the appraisal space are just coming out with new programs to help appraisers calculate and properly document their adjustments. These may catch on more when appraisers have had more time to work with them. It will be interesting to run this poll again in about a year and see if the numbers change.

Finally, we asked “Have you already, or do you plan to seek any type of appraisal fee increase due to the implementation of the Fannie Mae CU tool by lenders/clients?” This poll was the most popular of the three with a total of 4161 responses. A majority of appraisers, 53 percent, answered “Yes” while only 14 percent said “No”. The final group of 33 percent were “Not sure yet” at the time of the poll. So it would appear that most appraisers think CU is going to add some time, work, and possible aggravation to the appraisal process and they want to add a bit more to their fee up front to compensate for the potential increase in work. Looking back at the first poll, the majority of appraisers had not had anything returned due to the CU implementation. Again, I think when lenders get more familiar with CU and appraisers recognize and correct issues that cause rejections, the overall impact of CU to appraisers’ work load may end up being pretty small.

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