Mary Cummins, Real Estate Appraiser, Animal Advocates, Los Angeles, California

Mary Cummins, Real Estate Appraiser, Animal Advocates, Los Angeles, California
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Sunday, January 23, 2022

Letter to Rob Hayes of ABC 7 News Los Angeles by Mary Cummins Real Estate Appraiser

Rob Hayes, ABC News 7, @abc7 #abc7n@abc7robhayes, robhayes, Robert Hayes, Bias in Home Appraisals, Eyewitness News, Mary Cummins, real estate appraiser, los angeles, california, discrimination, appraisal gap, appraisal institute, national fair housing alliance, nonprofit, poc, race, people of color, white, brown, black, asian, latino
Rob Hayes, ABC News 7, @abc7 #abc7n@abc7robhayes, robhayes, Robert Hayes, Bias in Home Appraisals, Eyewitness News, Mary Cummins, real estate appraiser, los angeles, california, discrimination, appraisal gap, appraisal institute, national fair housing alliance, nonprofit, poc, race, people of color, white, brown, black, asian, latino

I just saw there was an actual article about this here. 

https://abc7.com/racial-disparities-in-home-appraisals-bias-discrimination-diversity/11496088/

No response to the email. Many other appraisers sent emails and responded to the article online. No response. This proves these "journalists" knowingly spread this false narrative to get traffic and clicks to sell advertising. It's not about reporting the real news or facts. It's about sensationalist news. In this case it's false claims of bias and discrimination which further divides our nation and people. There is enough real racism, bias and discrimination in our nation that we don't need to invent it. People should be fighting real cases of racism. How about dealing with the root cause of the white black brown wealth gap? It's income. How about helping POC make more money? That would allow them to buy and own more expensive homes and have the same amount of money as white people. 

Email to Rob Hayes of ABC News 7

I'm a female Latino Appraiser in Los Angeles with over 38 years of experience. There were some inaccurate statements in your news segment this morning about "Bias in Home Appraisals."

The National Fair Housing Alliance ( https://nationalfairhousing.org ) you cite is a private non-profit organization. Their recent 84 page "report" is based on false and misleading data. It was not a research report. I wrote an article about the major errors here.

https://mary--cummins.blogspot.com/2022/01/identifying-bias-and-barriers-promoting.html

The biggest flaw is that the report is not based on "multiple studies." None of the "studies' were independent peer reviewed and published research. They were all papers written by individuals and groups with agendas. I will illustrate just one issue in that report i.e., "appraisal gap."

There will always be an appraisal gap in areas which are appreciating quickly due to the historical nature of appraisals. Per government regulations Appraisers must use closed sales. Closed sales will always lag behind current contract prices by two to three months. Home values have appreciated during that time causing a gap. 

Values have been appreciating quickly in the last few years. The faster the appreciation rate the larger the gap. Lower valued areas which generally have more POC which are revitalizing or what some call "gentrifying" will appreciate at a faster rate than the market as a whole. That is why there are greater appraisal gaps in those areas. I wrote an article about this issue here https://mary--cummins.blogspot.com/2021/11/appraisal-gap-what-is-appraisal-gap-and.html NFHA knows this but they promote the false narrative to create a racial discrimination issue so they can increase donations to their organization. The more outrageous the story the more donations they receive.

It is difficult for anyone of any color to become an Appraiser today because of the trainee/mentor program. It has nothing to do with race but the program itself. Yes, I wrote an article about that as well here https://mary--cummins.blogspot.com/2021/06/difficulties-becoming-real-estate.html They are currently working to modify the program.

Most importantly the Appraisal Institute ( https://www.appraisalinstitute.org ) is NOT the governing body of appraisers. AI is a private nonprofit just like NFHA. Appraisers are governed by multiple state and federal government agencies. Another article which explains it.  https://mary--cummins.blogspot.com/2021/08/who-oversees-regulates-real-estate.html

AI's board is 100% white and mainly male. It costs $15,000 to become an AI MAI Appraiser. Their members are by far more white and male than regular Appraisers due to the positive correlation between higher income and being white and male. I asked them about their scholarships for women and Latinos. They said I would have to pay to become a member then I could apply with no guarantees of actually getting a scholarship. There is no scholarship for membership fees. That's not really a scholarship offer. 

Another misleading issue is the "accuracy" of the Zillow Automated Valuation Method (AVM). Zillow itself states their values are not appraisals and should not be used for valuation purposes. They recently admitted their AVMs are highly inaccurate when they closed down their ibuying department because they over valued homes they bought and had to sell them for less than what they paid. All Appraisers know the "a" in "Zillow" stands for "accuracy."

Perhaps the next time you do a segment on Appraisers and appraisals you should interview a local experienced Appraiser instead of just relying on inaccurate information on the internet. You are helping others promote the false narrative of the "racist white Appraiser." The four main articles about "racist Appraisers" have been debunked yet they are still promoted. I researched and wrote articles about those cases which are in the blog above.

Sincerely,
Mary Cummins
http://www.marycummins.com 
http://www.facebook.com/cumminsrealestateservices 

Mark Alston was quoted in the article but not the video, "Mark Alston said the report will be an "invaluable tool in trying to offset the damage done by the wealth stripping activity of undervalued appraisals in communities of color and especially in Black neighborhoods." 

There has been no "wealth stripping" of anyone except the Native Americans who owned this land originally. Appraisers appraise homes based on what similar homes in the same area have sold for. That is the law. We don't use the price of sold homes in Beverly Hills to appraise homes in South Los Angeles and vice versa. That is a federal regulation to use the most similar sold home comparables. 

There is a confirmed correlation between people of color and lower incomes. It's also a fact that women earn less than men doing the same job. Women of color earn even less than men of color or whites. People who make less money have less money. They tend to buy homes which cost less because that is what they can afford. For this reason there is a correlation between POC and lower priced homes.They also own cars that cost less money than white people especially white men. That does not mean that wealth has been "stripped" from them. If people want to close the wealth gap, they need to close the income gap. Help these people make more money. Don't go blaming real estate appraisers for appraising their homes for less than homes in more expensive areas. Remember, the three main factors in home valuation are location, location, location.

Mark Alston is the President of NAREB which is the "National Association of Real Estate Brokers, Inc. (NAREB) was founded in Tampa, Florida, in 1947 as an equal opportunity and civil rights advocacy organization for African American real estate professionals, consumers, and communities in America." That is where Alston is coming from in this article. 

http://www.Facebook.com/abc7robhayes

http://www.Twitter.com/abc7robhayes

http://www.Instagram.com/abc7robhayes

@itslisarice @natfairhouse

Mary Cummins of Cummins Real Estate is a certified residential licensed appraiser in Los Angeles, California. Mary Cummins is licensed by the California Bureau of Real Estate appraisers and has over 35 years of experience.


Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary, Cummins, #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, certified, single family, condo, condominium, pud, hud, fannie mae, freddie mac, fha, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, brea insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, 1073, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls, historical appraisal, facebook, linkedin DISCLAIMER: https://mary--cummins.blogspot.com/p/disclaimer-privacy-policy-for-blogs-by.html

Saturday, January 22, 2022

Mary Cummins 38th Year Work Anniversary as Real Estate Appraiser in Los Angeles, California

mary cummins, real estate appraiser, real estate appraisal, los angeles, california, work anniversary, 38 years, appraiser, appraisal, real estate, linkedin, facebook, marycummins.com


I started getting a lot of "Congratulations on your work anniversary!" messages on LinkedIn. I didn't realize that I've been a real estate appraiser in Los Angeles, California since 1984. I actually started in 1983 so it's almost 39 years. Time sure does fly when you're doing something you love. I still love real estate, homes, architecture, building design and numbers. I look forward to many more years in the industry.

Mary Cummins of Cummins Real Estate is a certified residential licensed appraiser in Los Angeles, California. Mary Cummins is licensed by the California Bureau of Real Estate appraisers and has over 35 years of experience.


Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary, Cummins, #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, certified, single family, condo, condominium, pud, hud, fannie mae, freddie mac, fha, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, brea insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, 1073, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls, historical appraisal, facebook, linkedin DISCLAIMER: https://mary--cummins.blogspot.com/p/disclaimer-privacy-policy-for-blogs-by.html

Wednesday, January 19, 2022

Identifying Bias and Barriers, Promoting Equity: An Analysis of the USPAP Standards and Appraiser Qualifications Criteria.

Identifying Bias and Barriers, Promoting Equity: An Analysis of the USPAP Standards and Appraiser Qualifications Criteria. Jim Park, James Park, ASC, Mary Cummins, real estate appraiser, real estate appraisal, los angeles, california, license, certified, residential, pave task force, trainee, requirements

UPDATE: The Fair Housing Alliance just stated they prepared the report with their partners. "The federally-funded report produced by the National Fair Housing Alliance and its partners raises serious concerns about the standards and criteria related to the appraisal of residential real estate, which often represents a family’s largest asset." IWoodruff@nationalfairhousing.org

How does one go about getting a federal government grant to write an "independent study" which uses false and misleading data to promote their organization's agenda? Must be nice. 

https://nationalfairhousing.org/groundbreaking-report-identifies-bias-and-systemic-barriers-in-real-estate-appraisals

ORIGINAL: Jim Park of the Appraisal Subcommittee (ASC) just released a press release which states,"Findings Released in Independent Study on Real Estate Appraisal Standards and Appraiser Qualifications Funded Through a Cooperative Agreement Between the Appraisal Subcommittee (ASC) and the Council on Licensure, Enforcement and Regulation (CLEAR) report titled "Identifying Bias and Barriers, Promoting Equity: An Analysis of the USPAP Standards and Appraiser Qualifications Criteria." 

It's an 84 page pdf. I assume this will be part of the PAVE Task Force report due February 2022? Send comments to jim@asc.gov 

https://www.asc.gov/Documents/OtherCorrespondence/2022-01-14%20NFHA%20et%20al_Analysis.pdf

The National Fair Housing Association, Fair Housing Advocates of Northern California, Fair Housing Center of Central Indiana, Andre Perry contributed to this report. They promoted the false narrative of alleged appraisal bias in the case of Paul Austin, Tenisha Tate in Marin, California besides a few others. Andre Perry has been peddling his non-peer reviewed, non-published false research to sell his books. I'm glad that Christensen Law and Peter Christensen also contributed to this report. Christensen understands real estate appraisal, regulations and the law. It doesn't look like he was allowed to contribute much at all.

I won't go over the entire report in great detail though I will note a few things.

Pg 5, paragraph 2, "Until recently, however, the appraisal industry seems to have escaped the type of regulation and scrutiny faced by other participants in the mortgage market. Our analysis finds that the appraisal industry has operated in a relatively closed, self-regulated framework."

Real estate appraisers are extremely regulated. We are more regulated than loan agents, real estate agents/brokers and others in the mortgage market. Real estate appraisers (brea.ca.gov) need a college degree, 200 hours of college level classes, 1,500 hours of experience with licensed experienced mentor, must pass exam and background check. Loan agents (nmls.org) only need a 20 hour course, must pass exam and background check. Real estate agents (dre.ca.gov) only need three college level courses, must pass exam and background check. These people act like Appraisers are the ones who made it so difficult to become an Appraiser to keep others out. It was the government who mandated this after falsely blaming Appraisers for the Savings and Loan Crisis, Great Recession and other real estate busts caused by other players in the market including the government.

We are regulated by the federal and state governments and are not "self-regulated." People are under the misconception that the private non-profit the Appraisal Institute (AI) who is supposed to represent Appraisers actually regulates Appraisers. They don't. We're regulated by multiple federal and state government agencies, see this article. Appraisers have to pay to join the AI. If you want to be an AI MAI Appraiser, it will cost you about $15,000 and take a couple of years. Only wealthy appraisers with $15,000 laying around and lots of extra time can afford to join. I'm not a member.

"Recent news stories have presented the shortcomings of the appraisal industry in stark relief, where individual homeowners and researchers have demonstrated that discriminatory bias continues to plague the appraisal industry, undermining value and breaking a key rung on the ladder to the middle class for families of color."

The recent news stories have proven to be false. The real reason people of color own homes which are worth less than the homes of white people is income. POC make less money. Women also make less money as do other groups. Of course they will buy and own homes that cost less. I've written about some of the major cases in the media, see below. 

Cora Robinson, Oakland, California. HUD complaint most likely already dismissed. 

Paul Austin, Tenisha Tate, Marin, California No HUD complaint, lawsuit will most likely be dismissed.

Carlette Duffy, Indianapolis, Indiana HUD complaint most likely already dismissed

Abena Sanders Horton, Alex Horton, Jacksonville, Florida New FOIA request. No info yet. 

I did FOIA requests for all of the above cases. Only three actually filed complaints. I believe two complaints have already been dismissed. I'm just trying to get a hold of the final report which they will not release unless I get a signed and notarized form signed by the complainant which states their full name, date of birth, country of origin, nationality, home address ... stating they agree to the report being released. I'm obviously appealing the FOIA case because that is ridiculous. I think they are withholding the reports because of the PAVE report coming out. These people publicly posted their complaints with their information online and in national press releases. The cases appear to be over per FOIA. If they won, they would have released another national press release and more media articles. This is why HUD doesn't release cases where no discrimination was found. They try to blame it on FOIA regulations which is false. Asking for the "country of origin" of the complainant seems discriminatory. I don't need or want to know that. It has nothing to do with the complaint.

From the Outline.

The report suggests Appraisers need more training on Fair Housing. We already have lots of repetitive training on Fair Housing to get your license and renew it every two years. That is not an issue.

Duty of Care, pg 11. They suggest adding the borrower as an "intended user" of the lenders appraisal report to increase accountability to the borrower. No much for appraisal independence and undue influence. Then the lender who ordered the appraisal will also be liable to the borrower. I see great push back on this issue. The purpose of the appraisal is to secure the loan for the bank and anyone who buys the loan or mortgage backed securities based on the loan. The borrower doesn't have to get a loan. A private loan is not a right but a privilege. The borrower can hire their own appraiser to do their own appraisal. Then they can be the intended user of that report.

"To increase the accountability of appraisers to borrowers who have been injured by appraisal negligence, the Appraisal Standards Board should consider amending the USPAP Standards to require appraisers to identify mortgage borrowers as “intended users” of appraisals prepared in relation to residential mortgage transactions."

Part I, Background, A, Bias in the Industry, "Redlining."

Adding race, nation of origin to the map data was dead wrong. Most of the other loan risk factors in the maps were based on many other factors besides race and nation of origin. The main factors were income and wealth of inhabitants. If you removed race and nation or origin from the data which they did, the risk stayed the same. These are the same risk factors we use today for credit scores. There is/was a correlation between POC and income. People with less income, less money live in areas with lower priced housing because that is what they can afford. These properties are more likely to be older, less well maintained, near industrial property and other less desirable features. That's why they were cheaper. When people have very little money, it's easy for them to not be able to make loan payments if they suffer one emergency. The solution to this problem is the same, increase the income of POC and others. More income, less risk. 

"Discrimination in Appraisals Continues on an Individual and Systemic Basis," pg 17.

They mention some of the alleged discrimination cases in the media. They don't bother to do any investigation into the cases to determine if there was indeed any discrimination. They don't post the results of the HUD complaints two of which were most likely already dismissed. Instead they link to press releases and false and misleading news articles. I will check out the Colorado and Connecticut cases.

"Discrimination in Appraisals Exists on a Systemic Basis," pg 18.

They mention the Freddie Mac research on Appraisal Gap. I wrote an article here which explains Appraisal Gap. You are more likely to have appraisal gap in areas which are revitalizing and quickly appreciating due to the historical nature of appraisal reports. Areas which are revitalizing are more likely to have POC. That is the correlation. At least they do note that the effect was shown across the nation and across appraisers. This shows it was not individual appraiser bias. 

They mention FHFA report on keywords found in appraisal reports, pg 19.

FHFA stated they searched millions of reports for what they feel are discriminatory words and found thousands had words which could be considered discriminatory. Just to get a ballpark figure here, 1,000/1,000,000 = .001 or .1% of reports. They did not review the reports and find the values were low or not market value. 

I agree that no one should have discriminatory language in the report. I disagree with the word "gentrification." I don't use it because it's not accurate.The proper term is revitalization. Still, it has nothing to do with race but money. Socioeconomic classes aren't protected. Lenders can discriminate based on money. FHFA itself uses the word all of the time as do other government agencies. Is it only discriminatory if an appraiser uses it?

Andre Perry's misleading report, pg 19. This report has been debunked here. It's not peer reviewed or published research. If you read Andre Perry's book, he is biased against certain people. He admits it. He also has an agenda to sell books.

Pg 19, "Howell/Korver-Glenn. A 2020 study of American Community Survey homeowners’ estimates from 1980 to 2015 found that neighborhood racial composition was an even stronger determinant of a home’s value in 2015 than it was in 1980."

That's because there is still a strong correlation between income and POC. The government and others haven't done anything about this. POC make less money. For this reason they buy and own homes in less expensive areas. They also own less expensive cars. Is that also the fault of real estate appraisers? FTR all the values came from inaccurate Zillow. Zillow has stated their values are not appraisals or accurate. Appraisers did not contribute the values in Andre Perry's paper or the other research so you can't blame appraisers.

Pg 22, They basically state the Sales Comparison Approach is biased because it's based on the sale prices of similar homes in the same area. Everyone knows the main three factors of home valuation are location, location, location. Should we use comps in Beverly Hills to appraise a home in South Los Angeles? No. Even if an Appraiser appraises a $100,000 home for $200,000, it doesn't affect the market value. The home is not worth $200,000. 

Pg 22, This is utter nonsense to cite in a government report!  In the book "Race Brokers, Dr. Korver-Glenn details the results of interviews with appraisers, including appraisers of color, regarding the steps they use to value a home based on their interpretation of the sales comparison approach.27 Many of  the appraisers in the study “assumed that White buyers were the standard for determining an area’s desirability, with White areas meeting this standard and receiving the highest values and non-White areas falling below the standard.“

Who the hell did this person interview?! Did they not interview appraisers in low income white areas like Florida, Virginia, California...every state in the nation? The sales comparison approach will show you the area's desirability based on money. It has nothing to do with color but income. AVMs, Appraisers don't see the occupants. We don't know the races of the people. There is no race reference in the data we research. 

Pg 24, "Appraisal Discrimination Is One of the Key Drivers of Today’s Wealth Gap." No, income gap is the main driver of the wealth gap! If you make less money, you have less money, buy and own a less expensive home. This discriminatory language should have never been allowed in a government report. People who complain about discrimination discriminating against others again. If the tables were turned, these people would be screaming bloody murder. 

Pg 24, "Appraisals Can Also Raise the Unique Challenge of Overvaluation." After the great recession everyone lost home equity. It affected poor people with subprime loans even more because the loose lending regulations by the government caused these people to have mortgages they could not afford. They lost their homes. If they met proper income, savings requirements, they would have been able to afford to pay their mortgage even though they were upside down like everyone else. If they weren't less wealthy, they would have had money to weather an emergency. 

Pg 26, "The Appraiser Workforce Suffers from a Lack of Diversity." Appraisers are just about as diverse as real estate agents, loan agents yet no one complains about them. They don't complain because agents can't kill deals with low appraisals but appraisers can. Here is an article I wrote about race and appraisers. That said I'd love to see race of appraisers match the nation. We need more diverse appraisers. The race of appraisers won't affect values because it's based on math and numbers. 

Part II. 

C. Governance of Appraisal Industry.

They bring up the fact that the Appraisal Institute is a private organization not part of the government, and doesn't legally have to abide by all government regulations. They suggest investigating the relationship between AI and the government. In the meantime they suggest AI add more diverse board members including consumers and civil rights people. In light of who actually made the report they basically want their own people on the board to control the AI. They said nothing about race, gender ... diversity. Here is their white board. Leadership is also 100% white. Six of 29 board members are women. I think they're all Appraisers. They should have others on the board. The government should keep in mind that the AI must follow their non-profit mission statement. Their mission is not to promote the government but appraisers and the industry. I didn't realize that people have to pay to appoint a trustee. That's ridiculous. AI should offer USPAP to anyone for free. Most of the other recommendations are already being done. 

D. Gaps in Fair Housing Requirements and Training

"As described above, the evidence clearly shows that the current appraisal system can result in biased valuations, both at the individual and neighborhood level. The causes of such bias are varied and complex."

I disagree that evidence has shown bias in the current system.  The Market Comparison Approach to value shows the market value. It's based on willing sellers and buyers. If someone wants to pay $200,000  for a $100,000 home in South Los Angeles, they can do that with a huge down payment but they won't because it doesn't make sense. The property won't be worth $200,000 except for property tax purposes. They can only sell it for $100,000. They lost $100,000. 

I also doubt that appraisers are not getting enough training in fair housing and discrimination. We take many classes to get our license and more classes every two years to keep our licenses. I don't know any appraiser who does not realize it's not legal to discriminate. If they want to add "shall" and "must" to USPAP, fine by me. I'm also fine with education changes as long as there aren't more hours and are just more hours on fair housing.

E. Barriers to Entry into the Appraisal Profession

I agree with some of these issues and suggestions though not all. They suggest reviewing any possible barriers to entry. Let's just make sure the bar is not so low that anyone can become an appraiser. You need to be a math, numbers person who can physically measure a building, climb a ladder, get into a crawl space, visually see construction material, hear a fan... They need some hands-on training. You wouldn't want a medical surgeon to just pass a written test then start cracking people open with a bone saw.

They suggest reducing license types to certified and general only getting rid of trainee.They suggest getting rid of college education requirement and possibly reducing the number of education hours needed. They suggest having an application based class so they can learn how to do an appraisal and getting rid of experience hours. If they do that, lenders will just make sure they only request appraisals from appraisers with so many years of experience. Those new people won't get work. They suggest reviewing the tests to make sure they are fair. I passed the appraisal exam for certified residential first time within an hour after a major car accident (uninsured motorist totaled my car) where I broke both wrists and got a concussion. I didn't go to the hospital until later because I was not going to lose my $750 test fee. I agree that some questions were worded poorly but just choose the best answer. The test was easier than high school exams. I would hope at least a GED or High School diploma would be needed. Don't set people up for failure. Make sure they can do the job or they won't get work.

They suggest AI and others try to recruit more women and people of color. I'm a Latino female. I contacted AI about supposed scholarships they offer. They said I have to pay to join AI just to apply for the scholarship! They dangle a scholarship to get money from new memberships. No thanks. 

One worry here is that the big rush of appraisals is over. We don't need new appraisers right now. I fear people will pay to become appraisers and lenders will not use newbie appraisers. That would be cruel to do to people.

F. Compliance and Enforcement p. 71

They talk about using data to determine if there is discrimination in appraisals. They talk about releasing report results. They won't release negative results of HUD complaints because complainant of course won't agree. You will only hear about cases where there was discrimination or someone agreed to a non-guilty statement just to end the case due to legal costs. They need to release ALL of the HUD complaints and investigation results.This is why the false narrative has continued. HUD did state most cases are dismissed but that's it. HUD also said most discrimination complaints based on disability and not color or race. 

They talked about maybe using another method of determine value. Lenders won't agree to cost or income approach as they don't reflect market value. Lender needs to know what they can sell the property before if the borrower doesn't make the payments. They talk about getting rid of the free form text parts of the appraisal. Okay! Less work for appraisers though they may no longer comply with USPAP without text explanations.

Pg 77, Reconsideration of Value

There should be standards in the ROV process. I believe there already are but I'm fine with it being more defined. Maybe there should be a fee paid by the lender. Sometimes an appraiser can be given seven new comps to consider. If you have to drive and see them all then put them all in the grid and then explain why they can or cannot be used, that's a complete new appraisal if not more work.

Conclusion

Overall I disagree with the message and tone of the report. The report is discriminatory, biased and defamatory against appraisers as a whole and as an industry. There is no independent research which shows appraisal bias and discrimination. They mention anecdotal media cases about alleged bias and discrimination as if they were facts. HUD won't release the final investigation reports of two cases which I believe have been dismissed because the complainants don't want them released. They refer to Andre Perry's paper as if it were peer review published research when it's just the false basis of his misleading book which he's selling. I'm okay with the basic recommendations which are to take a closer look at some issues. I agree with some of the suggestions to make becoming an appraiser easier. 

Below is the Table of Contents with page numbers. 

Table of Contents

Acknowledgments 3

Executive Summary 5

Part I: Background 13

A. The Problem of Bias in the Appraisal Industry 13

• The Appraisal System Historically Undervalued Homes in Communities of

Color

13

• Appraisal Policies Perpetuated an Unfounded Association Between Race and

Risk

15

• Discrimination in Appraisals Continues on an Individual and Systemic Basis 17

• Appraisal Discrimination Is One of the Key Drivers of Today’s Wealth Gap 24

• Appraisals Can Also Raise the Unique Challenge of Overvaluation 25

• The Appraiser Workforce Suffers from a Lack of Diversity 26

B. Civil Rights Laws and Regulations Applicable to the Appraisal

Industry

27

• The Fair Housing Act and the HUD Regulation 27

• The Equal Credit Opportunity Act and the CFPB’s Regulation B 28

• The Civil Rights Act of 1866 29

• State Laws and Prohibited Bases 29

• Theories of Proof 30

• Increase in Appraisal Discrimination Enforcement 33

Part II: Analysis and Recommendations 34

C. Questions about the Governance of the Appraisal Industry 34

• Overview of the Appraisal Regulatory Structure 34

• The Appraisal Foundation’s Legal Authority is Not Clear 35

• The Appointments and Elections Processes Would Benefit from Inclusion of

Viewpoints that Represent Consumers, Including Consumers of Color

40

• The Rules of Procedures and Exposure Draft Process Would Benefit from

Greater Transparency and Inclusion of Viewpoints that Represent Consumers,

Including Consumers of Color

44

2

D. Gaps in Fair Housing Requirements and Training 48

• Lack of a Clear Prohibition of Discriminatory Conduct 48

• Lack of Guidance on the Use of Discretion 52

• Lack of Clear Fair Housing Training Requirements 56

• Lack of Effective Fair Housing Training 58

E. Barriers to Entry into the Appraisal Profession 64

• Multiple Levels of Licensing and Certification 64

• College Degree Requirements 66

• Appraisal Education Hours 66

• Experience Hours 66

• Standardized Tests 68

• Concern: Pipeline of Trainees and the Future of the Profession 69

F. Compliance and Enforcement 71

• Need for Data 71

• Development of Robust Compliance Management Systems 72

• Duty of Care: Appraiser Accountability 75

• Reconsideration of Value Process 77

G. Conclusion 80

H. Glossary of Acronyms 81

I. Appendix I – Authors’ Summary Biographies 82

Mary Cummins of Cummins Real Estate is a certified residential licensed appraiser in Los Angeles, California. Mary Cummins is licensed by the California Bureau of Real Estate appraisers and has over 35 years of experience.


Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary, Cummins, #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, certified, single family, condo, condominium, pud, hud, fannie mae, freddie mac, fha, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, brea insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, 1073, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls, historical appraisal, facebook, linkedin DISCLAIMER: https://mary--cummins.blogspot.com/p/disclaimer-privacy-policy-for-blogs-by.html

PAVE Task Force Report Coming February 2022, by Mary Cummins Real Estate Appraiser

False and misleading. "The Interagency Task Force on Property Appraisal and Valuation Equity. An equitable path toward addressing the persistent misvaluation and undervaluation of properties experienced by families and communities of color." pave, task force, mary cummins, real estate appraiser, los angeles, california, 

The image above came from the PAVE Task Force website at https://pave.hud.gov . Their statement "the persistent misvaluation and undervaluation of properties experienced by families and communities of color" is very misleading. "Misvaluation" and "undervaluation" have not been proven. There hasn't even been any independent research on the issues. Andre Perry's non peer reviewed, non published personal paper has been shown to have major statistical flaws intentionally made by Andre Perry for his agenda in promoting his book for money. Fannie Mae's research showed there was no major difference in appraisal gap based on the race of the borrower. 

Per the National Association of Realtors (NAR) the Task Force report is coming out February 2022. It will be interesting to read the final report. With statements like the above they clearly have an agenda. If you remember, this was Joe Biden's campaign platform. Here's an article I wrote about Joe Biden's false statements about appraisals and appraisers. Team Biden basically invented a problem that didn't exist so they could promise to fix it just so they could get the vote of POC. I'm a Democrat. I understand politics and campaigning but this is just plain wrong to vilify people and a profession for your own agenda. 

Here's an article I wrote about the purpose of the Task Force. It lists all the members of the Task Force. Again I'd like to note that James Park of the Appraisal Subcommittee (ASC) is the only Appraiser on the Task Force. He doesn't represent Appraisers but the ASC. 

There are some things which should be changed such as the requirements to become an appraiser. The apprentice mentor program is not working. It's too difficult for apprentices and mentors. 

It will be interesting to see the final report. I predict it will basically suggest regulations and actions which are similar to our current regulations but worded as if they are new.

Mary Cummins of Cummins Real Estate is a certified residential licensed appraiser in Los Angeles, California. Mary Cummins is licensed by the California Bureau of Real Estate appraisers and has over 35 years of experience.


Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary, Cummins, #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, certified, single family, condo, condominium, pud, hud, fannie mae, freddie mac, fha, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, brea insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, 1073, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls, historical appraisal, facebook, linkedin DISCLAIMER: https://mary--cummins.blogspot.com/p/disclaimer-privacy-policy-for-blogs-by.html

Saturday, January 1, 2022

How to File Your Own Lady Bird Deed Real Estate by Mary Cummins Real Estate Appraiser Legal Expert

Lady Bird Deed, ladybird deed, enhanced life estate, revocable, real estate, trust, estate, deed, form, free, texas, vermont, west virginia, mary cummins, real estate appraiser
Lady Bird Deed, ladybird deed, enhanced life estate, revocable, real estate, trust, estate, deed, form, free, texas, vermont, west virginia, mary cummins, real estate appraiser

 

A "Lady Bird Deed" is also known as an "Enhanced Life Estate Deed." The deed allows the person owning the property, the life estate, to have full control over their property for life. They can terminate or change the deed at any time because it's revocable. The owner of the property has full continued power and authority over their assets without the involvement of the beneficiary. Without such a deed the owner would not be able to mortgage, sell the property or give it to someone else. 

In my experience the main purpose of such a deed is when a parent wants to leave their home to their child/children to avoid probate and eliminate transfer taxes. Prior to the Lady Bird Deed the transfer was irrevocable. That means you could never retract the deed if say your child mistreated you or became involved with elements such as drugs, gambling, debt, prison or a person, marriage you didn't feel was in their best interest. With the Lady Bird Deed you have full control of the property and can change your mind and take it back any time you like. 

The main estate and tax reasons to use a Lady Bird Deed are of course to avoid probate and taxes. The deed automatically transfers the property to the designated beneficiary upon death of the original owner avoiding probate. Because of the way assets are classified through the usage of a lady bird deed, anything left to a family member is termed an “incomplete gift” for tax purposes. This classification comes with two important benefits. "First, because of their incomplete status, these assets do not have any gift tax associated with them – there’s no need for the beneficiary to file a gift tax return. Second, the assets are included in the deceased family member’s estate when they pass. Because of this, the property qualifies as adjusted – essentially removing any appreciation that may have occurred while the original owner still retained the asset, which means the new owners will not have to pay as much in income taxes if they decide to sell the property." There are also benefits it you apply for Medicaid. A Lady Bird Deed does not have to be disclosed as a transfer. 

If you ever change your mind about the deed, you can file a revocation document or a new deed giving, selling the property to someone else.

Legal Terms Used in a Lady Bird Deed

ESTATE IN REMAINDER - The estate which is owned after the owner of the life estate dies. If you own the home and Lady Bird deed it to your son, your son owns the estate in remainder after you die.

GRANTOR - The Grantor is the owner of the property who is giving the estate in remainder.

GRANTEE - The Grantee is the owner receiving the property or estate in remainder. The Beneficiary.

LEGAL DESCRIPTION - The legal description is generally what is included in the deed that legally describes the property which is the land. It is generally tract # x lot # x. "Tract # 5745 lot 300." If there is more than one portion of a lot, if could be longer such as "MONTROSE TRACT AS PER BK 5 PG 170 OF MAPS SE 40 FT OF LOT 14 AND ALL OF LOT 13." Farm land is even longer and more complex. 

LIFE ESTATE - The estate which is owned during the life of the owner of the estate. If you own the property and lady bird deed it to your daughter, you own the life estate. 

PROPERTY ADDRESS - The United States Postal Service address of the property. Example, 123 Main St, Los Angeles, CA 90012. 

How to File a Lady Bird Deed

Go to this link and download the pdf. You can also just use the text below and make your own form.

https://drive.google.com/file/d/1o_ztG6MHl6vhDpkERU8VOfJSGhtr71sD/view?usp=sharing

Fill out the form. 

Get it notarized by a licensed notary. Be sure to bring your identification. They may charge you $5 or $10 to notarize it but your bank may do it for free.

File the form with the County recorder where the property is located. 

Text from the form.

*******

Lady Bird Deed 

This Deed is made on this day of _______________, 20__, between the 

Grantor ______________________________ 

of address __________________________________________________ and the  

Grantee Beneficiary ______________________________ 

of address _________________________________________________. 

For good and valuable consideration paid by the Grantee Beneficiary, the receipt of which is hereby 

acknowledged, the Grantor does transfer and convey the following described property to the Grantee 

Beneficiary effective on the Grantor's death: 

Property Address: ______________________________________________________________ 

Legal Description: ______________________________________________________________ 

 _____________________________________________________________________________ 

 _____________________________________________________________________________ 

The Grantor reserves a life estate for himself/herself during the Grantor's lifetime coupled with an 

unrestricted power to convey during the Grantor's lifetime, which includes the power to sell, gift, 

mortgage, lease and otherwise dispose of the property, and to retain the proceeds from the 

conveyance. 

EXECUTED this day of _______________, 20__. 

Grantor Name: _________________________ 

Grantor Signature: ______________________

STATE OF _________________________ 

COUNTY OF _________________________ 

On this day, personally appeared before me, _________________________, to me known to be the 

person(s) described in and who executed the within instrument, and acknowledged that he/she signed 

the same as his/her voluntary act and deed, for the uses and purposes therein mentioned.

Witness my hand and official seal hereto affixed on this day of _______________, 20__. 

Notary's Public Signature: ______________________ 

*******

More information about the Lady Bird Deed here.

https://agrilife.org/texasaglaw/2019/11/22/enhanced-life-estate-deeds-aka-lady-bird-deeds/

Disclaimer: I am not an attorney. I am a licensed real estate broker, appraiser, expert with over 35 years of experience. I help people fill out basic real estate forms. If you need legal, estate or tax advice, please, contact a licensed attorney in your state. I'm in California. Lady Bird Deeds are recognized in Texas, Florida, Michigan, Vermont, and West Virginia.

Mary Cummins of Cummins Real Estate is a certified residential licensed appraiser in Los Angeles, California. Mary Cummins is licensed by the California Bureau of Real Estate appraisers and has over 35 years of experience.


Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary, Cummins, #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, certified, single family, condo, condominium, pud, hud, fannie mae, freddie mac, fha, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, brea insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, 1073, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls, historical appraisal, facebook, linkedin

Tuesday, December 28, 2021

Number Licensed Real Estate Appraisers in California per BREA by year by Mary Cummins

Mary Cummins, Real Estate Appraiser, California, BREA, OREA, license, licensee, certified, residential, general, trainee, Los Angeles, number, increase, decrease, year


Mary Cummins, Real Estate Appraiser, California, BREA, OREA, license, licensee, certified, residential, general, trainee, Los Angeles, number, increase, decrease, year

UPDATE: 02152024 As of November 6, 2023 there are 8,796 appraisers in California down from a 20,000 peak in 2007. 

More stats:

59% are aged 50-69
65% are male




https://www.brea.ca.gov/pdf/23-493_BREA_Fall_Winter_Newsletter_web.pdf

Numbers for last 22 years or so are below:

2002 10943

2003 12167

2005 18854

2007 20100

2009 15625

2014 11868

2015 11189

2016 10852

2017 10742

2018 10562

2019 10056

2020 9630

2021 9461

2022 9374

2023 9012

2024 8796

08/01/23 As of June 15, 2023 there are 9,012 appraises in California down from 20,000 peak in 2007. https://www.brea.ca.gov/pdf/BREA_Spring_Summer_Newsletter2023.pdf



12/31/22 From the fall/winter newsletter. "As of October 1, 2022, there are 9,374 active appraisers. Eight percent are trainee level, 10% are residential level, 53% are certified residential level, and 29% are certified general level." Basically only 82% can appraise for federally backed bank loans. Number is down again. 



05/06/2022 Number of licensed appraisers as of March 16, 2022 is 9,613. "Eight percent are trainee level, 10% are residential level, 53% are certified residential level, and 29% are certified general level." This is based on the newsletter below which I received 05/06/2022. 

What's concerning is the number of certified residential is 4,988. You must have a Certified Residential appraiser for loan purposes if the loans are backed, insured by the federal government. You can also be a certified general but CR is the minimum needed. Number of trainees doesn't matter that much because business is way down now because of increasing interest rates. I doubt most get their final licenses because there won't be any work. You also need a minimum of two to three years of experience to get work. I wrote about this in a previous article about the problems with the trainee model.

https://brea.ca.gov/pdf/Newsletter%202022%20spring-summer.pdf

ORIGINAL: Above is a chart of the active licensed real estate appraisers in California per the California Bureau of Real Estate Appraisers. The numbers are also in a table below. This includes Trainee, Residential, Certified Residential and Certified General. The numbers aren't taken from the exact same time every year because that is how they reported it via their website. Most were November of each year. The numbers came from the Spring or Winter Newsletter reports. The specific dates and numbers are listed below. 

In Spring 2009 the head of BREA (then called OREA) Bob Clark  stated "With the unprecedented appreciation in real estate values, OREA experienced a dramatic increase in licensing activity, going from approximately 18,800 licensees in 2005 to over 20,100 licensees by the beginning of 2007. With the decline in the real estate market, the pendulum has swung in the opposite direction, with a current license population of approximately 17,300." 

There were 17,300 in the Spring (maybe March 2009) and 15,625 by November 30, 2009. Today we have less than 50% of the number appraisers we had in 2007 right before the peak then crash. We have about 10,000 fewer Appraisers. This doesn't mean we don't have enough appraisers. 

The peak before the Great Recession was about 2007. Homes had appreciated greatly and rates were low so everyone was buying, selling and refinancing. This caused a huge demand for real estate appraisers, agents and mortgage brokers. There is always a large influx during these times. It is expected to lose licensees as the market slows because there is less business. Appraiser licenses renew every two years today. It makes sense that licensees would not renew their license when it expires after the slowdown. For this reason there could be up to a two year lag between the slow down and loss of licensees. Some got their license to appraise as a side gig. Licensees doesn't mean they are working appraisers or full time working appraisers. 

Below is a chart of the U.S. National Home Price Index. You can see the 2007 peak and subsequent Great Recession. You can also see our current crazy market. 

Mary Cummins, Real Estate Appraiser, California, BREA, OREA, license, licensee, certified, residential, general, trainee, Los Angeles, number, increase, decrease, year
US National Home Price Index, BREA, Mary Cummins, Real Estate Appraiser


One would expect an increase in the number of appraisers when the market heats up like it has done within the last few years. Oddly enough there is no increase in the number of licensed real estate appraisers. I believe one of the reasons there hasn't been an increase is because of the current Trainee Appraiser Program. Today a new real estate appraiser must work at as Trainee for a licensed, experienced Appraiser for a certain number of hours. That is difficult to almost impossible because licensed Appraisers generally don't want to mentor trainees. Nothing to gain, everything to lose. I wrote an article that outlines the problems HERE with possible solutions. 

The market is expected to continue to appreciate though not at the crazy rate of 2020 and 2021. Some lenders, mortgage brokers such as Better.com have already eliminated some lending agents. One of the reasons it will slow is because the Fed has stated they will increase interest rates in 2022 maybe even more than once. Another reason is lack of inventory and many being priced out of the market. While some Appraisers were busy and had lag times within last six to 12 months things have already slowed and not just because of the holiday time of year. We may not need more appraisers.

The Government stated they are working to understand the Appraiser issue. By the time the issue is resolved there won't be a need for as many because of the market. Things have already slowed and will slow further. Maybe we just don't need as many appraisers as we did in the past. Today some lenders use appraisal waivers and AVMs. This could end up being a non issue. 

Some lenders, AMCs, others are stating there aren't enough appraisers. This isn't true. There may not be enough appraisers today willing to do desktop appraisals for $65-$130. Most appraisers don't want to do desktops because of the liability issue. The law and form states we must agree that we have enough verified data to complete the assignment. If you don't do the inspection, drive the comps, you don't have enough data. What if there's a major defect in the property, area, comp photos are photoshopped... Then the appraiser is on the hook for any loss. It won't matter that you relied on the inspection by John Doe and comp photos on MLS. You're still liable. Why accept the same liability for 1/5 to 1/3 the payment? 

Below is a cartoon about the issue. It's an older cartoon but it rings true today. 

appraiser shortage, not enough appraisers,cartoon, lie, false, mary cummins, real estate appraiser

AMCs, Lenders, others want to make it super easy for new appraisers so they can recruit newbies to underpay. Some AMCs, Lenders are offering trainee hours in house. That looks like influence to me. Some want certain people to be able to easily get appraisal licenses for other reasons. There is an agenda. 

While I feel the trainee system needs adjusting, we shouldn't get rid of it. We also shouldn't get rid of all education and experience requirements as some have been stating like Maxine Waters. That opens up the government, financial institutions and banks to huge levels of fraud. That would never pass Congress, thank god.

Chart number of licensed real estate appraisers in California by year. Licensing was first mandatory in 1994 because of legislation. I've been appraising since 1984 as a real estate agent though no license was needed at the time. 

Year

# Licensed Appraisers

2002

10943

2003

12167

2004

 

2005

18854

2006

 

2007

20100

2008

 

2009

15625

2010

 

2011

 

2012

 

2013

 

2014

11868

2015

11189

2016

10852

2017

10742

2018

10562

2019

10056

2020

9630

2021

9461

2022 9413

Below is where I got the data so you can see the actual dates. The 2007 data came from the quote above. As of December 1, 2021, there are now 9,388.

Mary Cummins, Real Estate Appraiser, California, BREA, OREA, license, licensee, certified, residential, general, trainee, Los Angeles, number, increase, decrease, year

Mary Cummins, Real Estate Appraiser, California, BREA, OREA, license, licensee, certified, residential, general, trainee, Los Angeles, number, increase, decrease, year

Mary Cummins, Real Estate Appraiser, California, BREA, OREA, license, licensee, certified, residential, general, trainee, Los Angeles, number, increase, decrease, year











Mary Cummins of Cummins Real Estate is a certified residential licensed appraiser in Los Angeles, California. Mary Cummins is licensed by the California Bureau of Real Estate appraisers and has over 35 years of experience.


Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary, Cummins, #marycummins #animaladvocates #losangeles #california #wildlife #wildliferehabilitation #wildliferehabilitator #realestate #realestateappraiser #realestateappraisal #lawsuit real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, certified, single family, condo, condominium, pud, hud, fannie mae, freddie mac, fha, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, brea insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, 1073, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls, historical appraisal, facebook, linkedin