One appraiser brain says you must be “independent, impartial, and objective.” (USPAP) It wants to be good. It wants integrity and to sleep peacefully at night.
But there’s another brain. It’s primal and wants to survive. It has other responsibilities: meet the bills, feed the family, pay the mortgage, and pay government taxes/fees. And recorded in this brain is that part of the standards which say: Do what your clients expect; do what everyone else does. As paraphrased, the sole guides to an acceptable scope of work.
The two brains may not talk to each other. Each has a different job. They proceed along parallel paths. One has feelings and beliefs and automatic responses. The other swears it’s being logical, clever, and correct. Each works fine.
And then . . .
You sign a certificate that states you have no preconceptions, no personal human bias or partiality, and that your results are not contingent on meeting the client’s expectations (desired result?).
The ethics rule says you must not mislead or defraud, even as the required definition of value may tend to do exactly that: mislead or defraud. (More to come on this topic.)
Even as the stated purpose of standards and professional intents is to “promote and maintain a high level of public trust”, (USPAP Preamble) your work must meet two requirements:
- The expectations of the users; and
- What your peers would do (right or wrong).
So, do you have two brains? One brain that wants you to feel good about yourself – your integrity, honesty, and ability to provide a result you really believe in. Or the other brain, that tells you: “I need clients to like me so they give me more business to feed my family, pay the rent, and buy a nicer appraiser car.”
Which brain wins? Maslow’s hierarchy of human needs clearly places the need for food, for safety, for family/friends/sex first. These drive human decision. These drive survival.
With basic drives assured, we’re able to enjoy self-esteem, confidence, achievement, respect for others, and by others. Then are we truly free human spirits, able to demonstrate morality, creativity, and spontaneity. Critical thinking improves, bringing effective problem solving, and a real acceptance of the facts/assumptions, logic, metaphors, and the stories that we tell (our comps).
Yet appraisers are driven down in Maslow’s hierarchy; by client expectations, and the excuse that everyone does it (“our peers”).
Six years ago, I formulated a personal mission for Valuemetrics and Evidence Based Valuation©. The mission statement: “To help prevent the next economic meltdown.”
Yes, our solemn signed certification puts us into an impossible human state. A state of rules, regulations, expectations, and peer pressure. A state that psychologists might say brings on dissonance. A conflict between one of our brains and the other.
One appraiser brain says Survive. The other says Respect Yourself.
How do you do both?
September 26, 2018 @ 8:03 am
Another good topic. Personally, I came grips with the issue of Client Pressure early on in my career. The way I found that was best for me was to always be willing to loose or fire the client. I have fired the largest banks and mortgage bankers in the nation.
When all the client wants is a Hit Man to come up with the Sales Price and call it Market Value; I am not their man. My most preferred client in a sale transaction is the Buyer. They usually want the truth, even if it means measurable Market Value is lower than the Sales Price agreed too. It gives them a chance to renegotiate or walk away.
I avoid appraising Sales, to avoid conflict. I tell brokers that when they have a client that wants my best shot at measuring Market Value, or a Tax Appeal, to feel free to refer them. In return, I will avoid appraising their Sales. This has worked well for me as a large portion of my business comes from Broker referrals.
We each have a choice and we make it daily, consciously or unconsciously. We can be the neutral that the license law and USPAP presumes we are, or we can be an accommodator. I would rather end my career with a reputation as a real appraiser, than as an accommodator. Because I live with this thought daily, I have no dissonance, love what I do, have good clients that want me to do the best job I can, and if necessary, be able to defend it under rigorous cross examination.
Again, thank you George for being a beacon and voice for the appraisal industry. You have done more to help the residential appraiser improve their work than any other in this industry, including the national associations. Your light shines bright, my friend !
November 10, 2018 @ 8:21 pm
I said this about AMCs yesterday and I’ll say this about Appraisers now. For either of us to survive we need to do the task which we were originally assigned. No excuses.
Appraisers came into play to fill a need. To safeguard the nations economy. Yes we’d love to do our jobs without interference but interference is what we have from a powerful machine.
The problem to be solved is how do we gain our independence to do our job?
The answer has been stripped down for us. Faced with eradication feeding one brain for a few dollars is not a sustainable option. Playing nice with the entities that we are essentially charged with overseeing and not safeguarding the economy will indeed render us invalid.
So now we address the root cause, stand up for what we know is right and protect the economy. Educate the consumer and build trust and support. This problem that appraisers have is really everyone’s problem (they just aren’t aware of it) We share the facts and solve it together.
The lessons to be learned from being in the same predicament despite the housing crisis of 2008 has crystallized the fact that despite the financial strength of lenders we have no place in their houses. We need complete autonomy. Meaning if you want to be an appraiser the only option ever is to be an Independent Fee Appraiser. If your more of a corporate kinda guy then you this may not be the career path for you. Appraisers cannot be employees of any lenders or GSE’s. It’s counter-intuitive.
Appraiser independence is key. Appraisers can no longer be part of any organization.
Consumers need to be educated and charged with protecting Appraisers autonomy.
These new ways around appraisers they’ve come up with are simply a means to keep us out of the way so the can loot and pilfer their way through the consumers. We know where this road leads. They may give us new titles in the aftermath but a governing task force will once again be required if only to regain consumer credibility so to restart this “Homeownership” game.
So let’s say I’m a dreamer and my fairytale utopia will never materialize. Then simply as our last act we should educate/inform the consumer to enable them to protect themselves and safeguard our economy. After all thats our job.
November 13, 2018 @ 4:29 pm
Dream on! The big banks own the system, The only way they will learn their lesson is to be held accountable. When the Tarp money was handed out in 2008 any bank that accepted the money should have had their CEO and Board resign with no golden parachutes. After all they committed mortgage fraud. The recent Wells Fargo fraud getting 5,000 telles to create false account tells you the Banksters are alive and well. Appraisers are but a small part of the problem. The problem is banks cultures have changed from a fiduciary responsibility protecting the depositor/taxpayer to a sales driven culture where the bottom line is all about the commision and profit. The only solution I see is for all US banks to be nationalized. No more sales driven cultures. Your thoughts? .
December 9, 2019 @ 5:40 am
Is it possible to accomplish both, George? IOW, is there a possibility that appraisers can perform in a professional, unbiased, manner – and still accomplish the task of providing his or her client with a product that the client is satisfied with? I think the answer can be yes – so long as the client is fully aware of the appraiser’s ethical responsibilities…