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36 | M R EP O RT FEATURE pursue joint strategies to make appraisal-related data more widely available, foster federal research, and better enable enforcement related to appraisal bias. I believe having public access to market data can help identify and remediate potential bias concerns. » Develop a legislative proposal that modernizes the gover- nance structure of the appraisal industry to improve transpar- ency and public participation in the establishment of appraisal standards and appraiser quali- fication criteria, and to advance diversity in the profession. » Define metrics that can help to identify and measure pat- terns of miss-valuation in the property valuation process and address potential bias in the use of technology-based valua- tion tools through rulemaking related to Automated Valuation Models (AVMs). WORD SEARCH: Another way to help reduce potential bias is for appraisers to use more objective language in their reports. Using technology and automated review tools, appraisals can easily be scanned for the use of subjective words and phrases that could be considered bias related. This information can then be analyzed to determine if there is a correla- tion between the use of poten- tially biased words and appraisal valuation. APPRAISAL DIVERSITY INITIATIVE: The Appraisal Diversity Initiative (ADI) is a nationwide program led by Fannie Mae, Freddie Mac, and the National Urban League. The goal of ADI is to reach out to diverse, talented candidates and educate them about the appraisal profes- sion and provide resources for interested candidates to help them get on a path to success in the ap- praisal field. According to Zippia, the most common ethnicity of real estate appraisers is white (84.8%), followed by Hispanic or Latino (6.6%), Black or African American (3.8%), and Asian (2.6%). This Zippia study also reported that 66.5% of appraisers are men with an average age of 50. AVM VALIDATION: Automated Valuation Models (AVMs) have been recognized as viable alter- natives to traditional appraisals under certain circumstances. In conforming neighborhoods with robust sales data, AVMs have proven to be very effective and accurate. Another benefit to AVMs is that they only consider actual market data to determine the valuation and are blind to all borrower and neighborhood de- mographics. The question around AVMs is related to algorithmic bias in the data and methodology used by AVMs. There are current studies and ongoing research underway related to the topic of AVM bias. To date, there are a few AVM providers that have gone through deep analysis to determine if their AVM contains algorithmic bias. Whether being used as an appraisal alternative in certain cases, or quality control check on a broader scale, AVMs may be a tool to help identify potential undervaluation. Appraisals are extremely im- portant for both the homeowner or seller, buyer, and the lender. For an individual, accurate and unbiased appraisals can play a role in building and sustaining generational wealth. For lend- ers, appraisals are instrumental for measuring collateral risk. By actively building a more diverse population of appraisers, utilizing advanced review word search tools and AVMs as valuation alternatives, we can better address inaccurate valuations and racial bias claims that can be detri- mental to a homeowners' overall financial health. JEFFREY HOGAN is VP of Valuations at Veros Real Estate Solutions, a leader in enterprise risk manage- ment, disaster data solutions, and collateral valuation services. Hogan is a state-certified residential appraiser with over 30 years' experience and is an expert on the tools available to help lenders and appraisers manage valuations. For more information on valuation tools and AVMs, please contact him at JHogan@Veros.com. DS News is the only publication in the country solely dedicated to providing default servicing professionals with news and content focused on their industry. SUBSCRIBE NOW! Connect with us online at DSNews.com. SUBSCRIBE TO THE LEADER IN DEFAULT SERVICING NEWS THEFIVESTARINSTITUTE