FHA/HUD has stated that a part of their mission is to eliminate the bad appraisers from their 30,000 or so roster members since eliminating the panel system. The solution is to blame faulty appraisals for every problem experienced much like the S & L problems of the earily 90s. As earily as last month HUD/FHA were rating roster menbers by their default rate and posting it on the internet. That site has been pulled now, but they fail to realize that appraisers are only a supporting role in this process. HUD/FHA is an insurance program catering to those who: 1. Originate the loan. 2. Package the loan & often sell it 3. Put pressure on the appraiser to hit a value. (Sometimes, not always) 4. Blame the appraiser for reporting any undesirable VC entries. 5. The lenders and/or Realtors can pick and chose the appraisers that will give them the value without the insulation of a rotating system. The appraiser has no interest in the property or parties. The lender and/or Realtor does have an interest to make a deal fly. Appraisers are not the main problem here and have no control over who defaults on a mortgage. FHA/HUD is really barking up the wrong tree if they wish to solve those problems. FHA/HUD appraisals do not make up a significant amout of my business, but I was on the old panel and the new roster system. I had done 3 FHA appraisals since 1998 and on the site had 1 go into default (Our market has not been good due to a military downsizing). I was posted as having a 33% default rate and was targeted for review on my 4th appraisal in as many years. (Other appraisers in our area were doing up to 60 + per year with a similar number of defaults.) To make the long story short, in rural areas, in a nondisclosure state, many guidelines or reporting requirements cannot be met. I was accused of submitting an unacceptable appraisal and violating USPAP. This was absolutely not the case.The appraisal review upon which they based their findings was faulty in itself and contained several Standard 1-1, 1-2, 2-1, & 3 USPAP violations including the ethics provision. Although unlikely in this case, an appraiser could be fined, be required to have further education, be suspended from the roster (their goal), or actually spend jail time. I spent close to 20 hours for doing the appraisal and answering the charges which under a new directive will be reported to the state board for possible investigation. This is real serious folks. It is not really worth the time it took to get the additional education necessary to remain on the roster after 2/2000. In spite of the fact that I am most likely one of the most qualified appraisers in the state wearing a dual hat as Appraiser/Inspector (General Contarctors license holder), I had virtually no FHA/HUD business in past years as I would require more repairs that other appraisers and would not rubber stamp a value. (Heard that one local lender was even telling people I wasn't on the FHA roster when I was requested as the appraiser.) I still have not heard from FHA/HUD concerning my December 2000 response to their charges, but have quit accepting FHA appraisal assignments. I don't need the problems. What FHA/HUD is succeeding in doing is eliminating the most qualified appraisers, who like me, don't need the added agrivation and have plenty of business without their headaches. When asked, I am telling people to go with a 3% down FNMA program. Less hassel, less time, less money, and fewer hoops to jump through. In this case less is better. Every Realtor should advise the buyer to get a home inspection and base their decisions upon a qualified opinion not a limited inspection by an appraiser, untrained in home inspection. Some states license home inspectors. It seems although HUD dosen't think it is a problem everyone can seethrough the spin. A real can of worms may be opening very soon on several fronts.

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