BLOG VIEW: There is not much the housing market relies on more heavily than accurate property valuations.
In this time of continued economic recovery, the professionals conducting appraisals are operating under more scrutiny and stringent conditions than ever before. Assignments now require more time and effort; a thorough job means researching city and county departments to ensure findings align with public records, writing extremely detailed narratives to support work, taking countless photos and using mobile tools to deliver information to an appraisal management company (AMC) or lender almost instantaneously.
To uphold accuracy and quality, lenders are depending on AMC partners to have robust scorecards in place to measure and assess appraisers. They want to know with certainty that the most appropriate appraiser will be assigned every time. They want to know the criteria AMCs use, how they address and rectify issues, and how they train and communicate with appraisers. Today, lenders treat appraiser assessments almost exactly as the company would evaluate its own staff.
Non-Subjective Scoring
The scorecard process has changed significantly in recent years – and for the better. Historically, many viewed the practice as subjective, based primarily on turn times and unjustly taking personal relationships into account. Some appraisers felt they were only as good as their last assignment, leaving little room for an honest mistake. Some even asked, on occasion, ‘If I stand firm on this value based on my experience and knowledge, will I upset someone? Will I receive a negative score?’
Instead, scorecards are now favorable for hard-working appraisers and lenders alike. With the emphasis on precise valuations, scoring has become more accurate and fair, better demonstrating an appraiser's complete body of work.
For instance, at USRES, we maintain robust scorecards through a two-stage process. Appraisers are evaluated and ranked on their time objectives; for example, we monitor the time frame from when they accept an order to when they schedule an appointment.
From the point of engagement through completion, a systematic grade is generated for each milestone. This grade is combined with arbitrary grades resulting from the auditor's direct feedback on factors such as the appraiser's level of communication and responsiveness.
AMCs are ultimately accountable for showing a lender why a specific appraiser was selected, and strong scoring processes demonstrate an appraiser's track record and prove just how the AMC came to pick the best person for each job.
Appraisers Strengthening Their AMC Relationships
Appraisers are developing stronger relationships with AMCs, seeing them as partners and resources to support them in a job that has become increasingly difficult. An AMC with a strong scorecard method tracks appraisers' progress, notes areas of strength and measures performance against their peers. AMCs with expert appraisers and auditors on staff provide their appraisers' valuable insight and assistance to enhance their skills and their businesses. In addition to identifying the best assignments for each appraiser, scorecards take old-school techniques and favoritism out of the equation – greatly contributing to appraisers' comfort level when working with an AMC.
The essence of the scorecard is to show an appraiser's capabilities without any outside influence, ensuring they are defined by their work and merit. It is not about whether they make an occasional mistake, but rather overall consistency and their commitment to quality. In the end, it is all about quality. We feel strongly that turn times should not be weighed higher than accuracy when assessing an appraiser's performance; quality is first and foremost and should never be sacrificed.
Garrett Mays is vice president of vendor management for valuations services firm USRES and its technology company, RES.NET.
