January 2017 - The World's Local Bank

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30 | TH E M R EP O RT FEATURE to the needs of that specific as- signment and to avoid reliance on overly general instructions. Complex requirements that may or may not apply to each order have the unintended consequence of drawing away the attention of the appraiser rather than allowing them to focus on what is needed for each particular assignment. For example, if the client for an appraisal only requires one listing or does not require listings at all, it is important to make sure that the assignment instructions reflect this so that the appraiser does not spend time trying to track down the agent and verify the listing details. Revising the initial request can kill productivity on all ends starting from the appraiser and AMCs, and ending with the review and underwriting team at the lender's office. Many times, these revision requests can be avoided by addressing them at the onset when the appraiser reviews the engagement letter. This would also help expedite the review process to reduce the number of unnecessary revisions and the need for multiple reviews on the same appraisal. When the initial submission has met all of the re - quirements, appraiser frustrations are kept to a minimum, resulting in a better working relationship for future assignments. Formulate Scoring System AMCs that are using a detailed scoring method to assign orders are also key to ensuring that the appraiser that is being selected has a good track record and has proven to be a reliable partner based on prior transactions. Without an adequate scoring sys - tem, it is inevitable that providers will experience quality or service issues where they might other- wise have been easily avoided. It is also important to inform the borrower of the appraisal process and ensure that they know what is required. An appraisal can either be a seamless part of the process or create a nightmare for consumers if things go array. Remaining compliant and reduc - ing the number of final inspection reports needed can also save the borrower time and money at a time when both are often in short supply. Providing borrowers with a "Do's and Don'ts" list is often an excellent tool to reduce time and cost during the appraisal process and a great way to set the expec - tations ahead of time. Challenges are a part of every industry, but as long as we view them as opportunities, the industry will be able to move forward and make changes that will ulti - mately benefit the consumer. With improving technology to assist ap- praisers and auditors, we are see- ing increasingly accurate products delivered to the consumer. Like all technology, there will be some users that adapt and improve, and unfortunately there will be some that will refuse and struggle to keep up with an ever chang - ing market. Creating an influx of new, young appraisers, and getting current appraisers up to speed will create a viable path forward for the appraisal industry and ensure that both mortgage servicers and consumers continue to receive a product that meets their needs. GEORGE PAQUETTE has worked with USRES as a Senior Review Appraiser, Valuations Manager, and now serves as the Chief Appraiser for USRES, Inc. and its wholly owned subsidiary RES.NET, Inc. Paquette is a state certified appraiser in multiple states and an SRA candidate with the Appraisal Institute. * * * How Can AMCs Ensure Compliance? By Vladimir Bien-Aime W e know that our indus- try is always going to be heavily regulated across the board. The appraisal side of the mortgage business will certainly be a part of government regulations. Organiza - tions will be affected by compli- ance adherence at both federal and state levels, and the CFPB can au- dit any lending entity at any point in time. However, to what degree of compliance we'll be facing as an industry moving forward remains to be seen. President-elect Trump vows to unwind Dodd-Frank and weaken the CFPB, but that's just rhetoric. Organizations must be prepared to operate in a continu- ing regulatory-intensive lending landscape. Complexities of the Process There will always be a lot of complex intricacies to over- come, especially when it comes to compliance. It's challenging to effectively manage the appraisers, receive appraisal orders, assign orders to appraisers, track progress and status, handle accounting functions, deliver the appraisal, perform automated appraisal reviews, and compliantly sell- ing the appraisal to the Uniform Collateral Data Portal or Electronic Appraisal Delivery Portal. Outsourcing the Process A majority of lenders rely on an appraisal management company (AMC) to outsource most of the aforementioned functions, and most lenders use several AMCs due to geographical expertise and access to quality area apprais- ers. Most established AMCs do a good job of handling the appraisal process for lending entities, but you can't expect them to ensure 100 percent of compliance with all appraisal regulations, which change from time to time. Lenders can- not assume that any outsourced entity will ensure compliance. The lender is ultimately responsible for complying with appraisal laws and regulations. The buck stops with the lender, and if out of compli- ance, they will be facing poten- tially stiff fines and penalties. Integrations with Valuation Management Platforms and LOSs Mostly all AMCs use some form of technology to help manage the appraisal process to make it easier for lenders to do business with them. Each AMC may use a different technol- ogy system that automates basic functions for both them and their clients (lenders and vendors alike). The lender's staff could potentially have to learn each AMC's tech - nology for managing many dif- ferent processes, such as ordering, receive status updates, workflows, and reporting. However, it doesn't have to be this way. By using an enterprise- class valuation management platform, lenders can leverage their system of record internally, and the AMCs that they do busi - ness with can also integrate with and leverage the same system's functionality. This makes it easy for multiple AMCs the lender uses to easily synchronize data, communications, and report - ing. What's more, the integrated reporting aspect between lender and multiple AMCs allows for the centralization of all report- ing on the lender's entire pipeline via a single, simplified reporting interface. Equally important is that good integrations should always exist between the software vendor's valuation management platform, the lender's loan origination system (LOS), and the AMC. This level of integration allows lenders to efficiently and compliantly complete appraisals directly from their LOS. If the AMC is harness - ing the lender's valuation manage- ment platform, then an integration with lender's LOS makes it easy to efficiently and compliantly process appraisals. The lender should never have to leave their LOS, and the integration should be seamless and bi-directional in order to completely streamline data exchange and facilitate ease of communication between the two platforms. If all systems are tightly in - tegrated, duplicate data entry is eliminated, thus reducing errors, cutting costs and dramatically speeding up the appraisal pro- cess, all while remaining in full compliance with state and federal regulations. A detailed report is BEST IN ORIGINATION Waterstone Mortgage Corporation

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