FNC Blog: Appraisers Working Long-Distance Spells Trouble for Mortgage Industry

Housing market downturn a major disruption in the appraisal process, says mortgage technology expert

OXFORD, Miss.--(BUSINESS WIRE)--A mortgage industry trend that requires appraisers to work in unfamiliar neighborhoods is resulting in serious valuation issues, according to a new blog posted Sunday, Nov. 22.

“In other words, they are appraising in neighborhoods where they don’t know the market.”

FNC’s chief data and analytics officer Dr. Bob Dorsey tackles the issue of appraiser geocoding in the mortgage technology company’s new blog—Collateral Vision—which debuted today.

“One of the most consistent observations FNC has been hearing lately from mortgage originators is that they are receiving appraisals from appraisers who are operating outside their regions of competence,” Dorsey writes. “In other words, they are appraising in neighborhoods where they don’t know the market.”

The consequence? Neither lenders nor appraisers can truly have confidence in their property valuations, a problem that can lead to increased lending risk.

Dorsey says today’s lean job market has forced some appraisers to work outside their comfort zones. He also blames the trend on new regulations and downsizing by lenders.

The solution is technology. Dorsey describes how lenders can use FNC systems to automatically identify where appraisers are most likely to have geographic competence. With advanced geocoding technology, lenders and appraisers alike can gain confidence in the valuation’s accuracy.

Geographic competency is governed by the Competency Rule of the Uniform Standards of Professional Appraisal Practice (USPAP) and has been a topic of great discussion in the residential mortgage lending industry.

Learn more about geographic competency and other tough issues facing the residential mortgage industry. Visit www.collateralvision.com.

About FNC, Inc.

FNC pioneered real estate collateral information technology. Since 1999, FNC has driven down costs and streamlined loan processing for the nation’s largest mortgage lenders. With its collateral management platforms and collateral-focused data and analytics, FNC provides advanced insight into the property backing a loan from origination to capital markets. No one understands real estate collateral better than FNC. Visit FNC’s Web site at www.fncinc.com.