[quote=HLS]
The change in appraisals is saying that appraisers were responsible for the housing mess. There is only a sliver of truth in that. A dishonest appraiser is still dishonest.
[/quote]
Face it, the whole appraisal “industry” is dishonest, else we would never have seen the ridiculous valuations of the recent past. Anyone with an ounce of sense could see that no matter what someone was willing to pay, and no matter what some damnfool bank was willing foist off on the MBS “investors”, a 1,000sf 3/1 shack in Da Hood isn’t worth almost a half million dollars.
The lenders needed someone to put a fig leaf over their obvious disregard for underwriting standards, and the appraisers were only too happy to oblige.
[quote=HLS]This will ruin the careers and incomes of honest appraisers. If an appraiser has been in business for 10-20 years and has dozens of banks or brokers sending them business, that stops completely on May 1st…
An appraiser with 8 employees recently told me that he is done, and 8 appraisers will be out of work. He will not get enough orders to keep them busy.[/quote]
It’s sad when times change, true. But ask your friend how much responsibility he bears for this mess. How many tumbledown shacks in the barrio did he swear were worth a third of a million bucks? How often did he or his employees have a target number to hit? How many times did he turn a blind eye to obvious structural problems? How many times did he cherry-pick comps to hit his number? If he was in the game during the boom, I’m sure all that and more was going on because no one would have sent him business otherwise.
Now, I’m not saying the upcoming changes will improve matters. But I am saying that the appraisers have been key players in this debacle and they’ve gone down that road willingly.
