Appraisals and other types of valuations are coming under increased fire in recent years, resulting in regulation and GSE guidelines that require appraisal independence, more accountability, clear justification for valuations and more transparency for end-users, including borrowers.
For appraisal firms, appraisal management companies and other valuation providers, the changes mean adapting to a new business model. The documentation required for each valuation has multiplied in order to provide monthly reporting, prove quality control standards and leave a robust audit trail. That documentation requires multiple data points — including comparable sales data, pictures, and details of specific features.
And all at a time when originations are slowing.
So how are companies who provide and manage valuations faring in this new environment? For the companies profiled here, very well.
As in other parts of the mortgage market, the companies who are thriving the most under increased scrutiny are those who prize quality and have it as a core company value. They are engaging technology to provide data and analysis not to take the place of a valuation expert, but to make operations more efficient. They are embracing higher standards not just because it’s required, but because their goal is to know and communicate what an asset is really worth — to arrive at true value.