FHA Policy and Appraiser Assignment
Everyone is wondering how these new FHA changes are going to be handled. Appraisers are concerned with the timing of when appraisers are assigned.
Here’s a comment from a recent forum discussion from an appraiser who has this concern. AIMSdashboard President Chris Williams offers some solid advice and a solution regarding this topic.
Chris,
One of the fears in that kind of arrangement, not assigning the Appraiser till later in the system, is the obvious fear that some will still find a way to shop for an Appraiser that gives them what they want to hear. It seems that not assigning the Appraiser into the system early on may be counter productive or worse. I'd like to see the FHA return to their rotation system as a way to avoid potential impropriety.
Donald J. Martin
Answer:
Your point offers a great perspective for me to hear specifically. Thanks for the feedback! It provides validation to some of our thoughts while it also prompts us to remain focused on controls and policies!
You're right, there remains fear of manipulation; and that fear is not restricted to FHA! ;-) Most of the recent regulation/loan program definition revolves around holding the lender responsible for controlling these risks. If the various loan programs and regulations share some core commonality, then a lender approach may be an efficient one.
As software companies like ours help to restore appraisal operations within lender operations, we must deliver policy controls to help mitigate risks such as the one you've raised. I'm sure it would not be surprising to note that lender executives are interested in quashing the risk as much as the appraiser. Lender execs don't want exposure to loan buybacks simply to help an origination agent achieve their respective bonus or commission.
To use AIMS as an example, our current functionality allows either the lender or broker to provide the FHA Case # (flexibility at that layer) within AIMS, and the ePortal queues up an appraisal initiation to a selected lender loan program (in this case a lender's FHA program). Then after the lender approves the queued appraisal request within AIMS, the system uses three different selection methods, that are based on *** pre-established lender policies ***, to fulfill appraiser selection processes. Changing these policies results in the logging of the changes along with comments as to why changes were made.
Although virtually any system can be "played", with AIMS (and I'd assume other software approaches) the "player" will be tracked; and the activities will be logged (and summarized in the Appraisal Request audit report).
We want the lender's network to have the flexibility to define their own operations model, while maintaining the controls to implement the model. Combine the controls with the audit trail and the lender can manage by exception (instead or either not managing - black box of outsourcing to a third party AND/OR instead of managing each appraisal manually).
We have also provided the "check and balance" of having Appraisers performing the acceptance or declines within our audited system. The appraisers are given access ** at no charge **. And, although the lender can perform updates related to an acceptance or decline by an appraiser, if the lender reps make changes, the appraiser is notified of any such changes made to their Appraisal Requests.
As a trigger to revisit the workflow, AIMSdashboard’s development plans for AIMS include periodic iterations to capture evolving audit requirements to help box out opportunity of masked appraiser "shopping".
We've got a great system right now with AIMS release 4.4.0; and we expect that we'll have enhancements periodically to address regulatory revisions, program changes, and user feedback (direct and indirect (i.e. "player" control!)). It is all in a day's work!