Real Estate Agents:
The recent ruling in the California courts “Tindall vs. Murphy”, opens you up to extreme liability, as a buyers agent. The use of the appraisal conducted by the bank or lenders appraiser is restricted to the bank or lender. They have no legal duty to the buyer in terms of using "their" appraisal report as a reference. According to the National Association of Realtors Risk Management Law, “a broker is obligated to disclose to the buyer any facts affecting the value of that property”! If a buyer decides to contest the purchase price at some later date, the only party involved in the transaction (with Errors and Omissions insurance) they will be able to seek recourse from is the real estate agent! It would be wise that the real estate agent have their client obtain their "own" appraisal!
The final rule of the Pention Protection Act. (2018) states that you can no longer estimate the value of charitable, non-cash donation items over $5,000. The value of a non-cash, donation suspected to be in excess of $5,000, must be appraised by a licensed and qualified appraiser. (#5695A, Internal Rev.Code).
Recent efforts by banks and lenders to increase profits and reduce processing times have greatly reduced the quality of appraisals and the appraisers they use. This is to the detriment of property owners. Many of the banks and lenders are using Appraisal Management Companies (AMC's) to take care of their responsibilities and are not compensating the AMC's for their services. Instead, the banks "pocket" a portion of the fee collected, give the remaining portion of what was collected as an "appraisal fee" to the AMC. The AMC is incentivized to award the appraisal assignment to the lowest bidder not the most qualified, because whatever is leftover is kept as compensation to the AMC. It would be wise for a buyer of real estate to hire their own appraiser based on qualifications, experience and competency to assure they are getting a credible appraisal!
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