More Efficiency In the Appraisal Process? Yes, Please. But Don’t Throw Out the Baby With the Bath Water.

The quest for the digital, end-to-end mortgage experience continues on, having really heated up in the past 18 months. This is largely a positive development, in fact, maybe a necessary evolution for the mortgage industry.  As painful as it is to admit, the process of getting a mortgage and into a new home is nowhere near as simple or easy as the process of securing a student loan, or a car.  The days of walking into an L.O.’s or Realtor’s office have long since given way to doing a quick search on an iPhone or iPad.

It’s no surprise, then, that Fannie Mae CEO Timothy Mayopoulous is among those who support a definitive streamlining to the mortgage process.  In a recent Housing Wire article, he had this to say. “With Amazon shopping one click away and streaming Netflix on your smartphone, looking for a mortgage is a wildly different digital experience,” he said.

Hard to argue with that.

How does Mr. Mayopoulous propose we upgrade the experience?

So, while the industry as a whole is rowing in the same direction, efforts to streamline the appraisal process, Mayopoulous said, is a step in the right direction for Fannie Mae, which earlier this year refined its appraisal policies, which reduced overall appraiser responsibilities.

“We are not interested in eliminating appraisals, but we should be exploring options electronically,” he said. “Appraisers should be at their desks,” not in the field with a measuring tape, making phone calls to track down homeowners, he added.

We can certainly support this in many ways.  However…

We often have short memories, especially as it relates to painful experiences.  Prior to the crash we moved away from using field review appraisals, drivebys, and bpos in favor of AVMs and market indicies.  The problem is, we can’t rely on objective data alone to answer subjective questions.  AVMs and other real estate data related technologies most definitely have a place in our world today.  But, qualified, experienced appraisers with subject market experience and their on-site inspections are as important as ever, maybe even more so.

We absolutely support the drive to eliminate waste, unnecessary cost, redundancy, delay and error.  But let’s not sacrifice authentic and relevant data that can only be provided by appraisers themselves in the name of achieving those goals, either.