Qualified Appraisers are Necessary for the Accurate Restructuring of Loans

By cherie • March 2nd, 2009

Several of the nation’s real estate appraiser organizations are asking the Administration to require that residential market values be determined by qualified appraisers. It is necessary to use licensed and certified appraisers in order to protect homeowners under the Homeowners Stability Program. In order to restructure loans, banks require homeowners to have their home appraised when the market goes through significant changes. The organizations, the American Society of Farm Managers and Rural Appraisers, the Appraisal Institute, the National Association of Independent Fee Appraisers and the American Society of Appraisers state that reliable appraisers are available in all communities, nation-wide.

Licensed appraisers have the ability to produce effective and reliable appraisals. Using licensed and certified appraisers will allow for accurate and fair restructured loans. Licensed and certified appraisers are regulated by the state. On the other hand, using real estate automated broker price opinions is risky because they do not have training a field appraiser has in evaluating property value and their evaluation methods are not standardized. Appraisers are held accountable for their evaluations.

Using broker price opinions in the mortgage relief plan could cause the violation of state laws. Further, computer evaluations are not accurate in struggling markets or in diverse areas. It is also not advisable to use housing indices to determine market value because the data is usually several months old and typically does not calculate in short sales and foreclosures. Qualified homeowners may be denied a restructured loan because their homes were valued using inaccurate information.

Requiring the use of licensed appraisers will help ensure accuracy in valuations. Qualified homeowners will not be turned down due to incorrect appraisals. In order to provide fair and consistent loan modifications, appraisals must be professional and appraisers must be held accountable.

 

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