<< Navigating continued from Page 36
Information from the CU analysis can help get the risk score to a level that
is comfortable for the lender. Use this five-step process within CU to determine if red flags should be validated, verified or dismissed.
1. Leverage flagged messages. Determine what the flags indicate about
the risk. What aspects of the appraisal do the messages draw attention to?
2. Explore property records. Look for inconsistencies in property records
between appraiser listings on the same property. Focus on the appraiser’s
description of the property. Is it accurate and consistent with other sources?
3. Use map imagery. Use the CU map interface to explore the characteristics of the property and any surroundings that could impact eligibility,
marketability or value. Use satellite and skyview on the map to pinpoint
the property’s location and neighborhood in relation to major highways
or high-voltage power lines. Ultimately, check if the imagery seen in CU is
consistent with the description of the property provided by the appraisal.
4. Check sales history. Evaluate the property’s three-year sales history in
CU to determine if it matches the appraiser report.
5. Sort data appraisal. CU provides several options for sorting data. Sorting the data-points column provides a snapshot of how the property fits
into the neighborhood and surrounding comps. This can help determine
where the subject property fits within the market data.
Using these internal steps and analytics in CU, along with personal expertise or market knowledge, can help originators and loan processors
make informed decisions about risk. If your originators and processors lack
experience, or your company needs help strategizing on risk concerns, you
can escalate the process by speaking with your appraisal management
Maximizing appraisal management
CU flags and messages are meant to be used by lenders and mortgage
companies. They were not created to be actionable by AMCs or appraisers.
AMCs can help mortgage professionals understand what they can or cannot
do to eliminate risk concerns, however. A strong signal it is time to reach out
to your AMC for help is when you experience bottlenecks that delay clos-
ings, or if your current loan volume is being limited by delayed appraisals,
bad service, or slow turn times.
When you have problematic CU reports, it can help to get extra input
from the AMC. Ask for feedback on general risk questions so they can be
presented to the appraiser in an understandable manner that could pro-
duce the answers you need to lower your risk score.
Don’t hastily send CU flags to the appraiser and ask them to fix those for
you, however. This will only cause confusion, which wastes valuable time
and costs. Plus, it’s a good idea to formulate questions in such a way that if
changes are not necessary to the report, the answer will ultimately help you
mitigate potential risk.
Be specific when speaking with the appraiser or AMC. Don’t make vague
requests. Instead, ask questions that are based on facts. Use data obtained
from factual sources such as CU to inform the appraiser about the request
you are making.
Finally, avoid requesting comments from an appraiser about CU flags or
messages. Concerns about a gross living area, or GLA, adjustment rate, for
example, cannot be resolved simply with a comment. Instead ask appraisers to provide verifiable data, such as the derivation of the adjustment rate.
Then, if a revision is justified, ask the appraiser to revise the report and resubmit it.
Collateral Underwriter is a robust tool that provides lenders and mortgage companies with dynamic functionality and the necessary context to
examine appraisal reports and act on findings appropriately. Don’t be
discouraged when an appraisal comes back with flags. Instead, leverage
the program’s data insights alongside your own professional judgment to
improve loan quality and process efficiency across the board. n
Richard Garrie is chief appraiser for United States Appraisals, which provides professional
appraisal-management services in all 50 states. Garrie has more than 20 years of residential
valuation experience. He assists appraisers with complex assignments, supervises internal
review staff, works with clients and appraisers to meditate appraisal disputes and provides
internal training and guidance on compliance. Garrie also is in the foreground of new and
emerging regulatory appraisal guidelines. Reach him at firstname.lastname@example.org.