Category Archives: Politics & Regulation

We Need To Talk About Fannie Mae A Bit

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A couple of weeks ago, I learned about a new Fannie Mae program that was rolled out to lenders called Collateral Underwriter, or CU. From the press release:

Fannie Mae created the online tool in 2013 to analyze appraisal data it had been receiving from lenders electronically since 2012. With the rollout in early 2015, mortgage lenders will have access to the same information that Fannie Mae uses to evaluate property appraisals. It will enable lenders to review appraisals and address issues before delivering the loans to Fannie Mae.

It’s got the appraiser community in an uproar:

Only a few days into the release of the Fannie MaeCollateral Underwriter and my prediction of this being the biggest process change in the appraisal industry since the HVCC is becoming a reality for the field appraiser.

Appraisers and lenders are flabbergasted about what to do with the recent findings and feedback that CU has provided regarding appraisers’ work.

The appraisal community blogs and forums are packed full of questions regarding how to handle CU and how to properly defend appraisal reports as well as who’s responsible for review this information.

Fannie Mae’s guidance that the lenders are responsible for reviewing and interpreting the CU findings has turned into some lenders sending all the findings to the appraiser to comment on with no interpretation or guidance.

Granted, the program is new, there’s a lot of confusion, and a lot of unknowns. But while the industry’s been obsessed with Zillow and drones and such, something like Collateral Underwriter is likely to impact the real estate agent on the ground far more than any of those things. If you’re in the industry, I think it’s worthwhile to at least learn about it at a high level. Let me get the conversation started.

I’d like to thank Rick Lifferth, Founder and CEO of Data Master and a still-active appraiser with 40+ years of experience, and Bill Garber, Director of Government and External Relations for the Appraisal Institute, for taking the time to educate me on the topic as best as they could. Any errors or mistakes in this post are because I’m a poor student, not because they haven’t tried.

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Grading Time! Reviewing My 2014 Predictions

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Welcome to another edition of an annual tradition, in which I go back and grade myself on my predictions made at the start of this year. My track record so far:

  • 2010 Predictions: 6 of 10 (.600)
  • 2011 Predictions: 4.5 of 7 (.642)
  • 2012 Predictions: 2 for 7 (.286)
  • 2013 Predictions: 4.5 of 7 (.642)

When I made my 2014 predictions, I wrote: “In any event, it’s customary here at Notorious to make predictions that are sure to go wrong, or your money back! 2014 should be no different in that regard.” Given how gloomy my predictions tend to be, I’m happy to report a solid no-good outing in 2014!

Let’s get into it.

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Raising the Bar and Lawsuits… A Thought

I know I haven’t been blogging, but hey… when you’re sitting on the beach in Aruba staring at gently lapping waves of turquoise waters, diving into the Interwebz isn’t real high on your list of priorities. Trust me on that. :)

In any event, saw an interesting little tidbit this morning on Inman News that got me thinking. The item is this: “Realtors are all talk when it comes to education” The embedded video is below.

I met Leigh Brown at HearItDirect/RETSO event in Atlanta, and thought she was energetic and not afraid to speak her mind (as you can see above).

But here’s the thing. Leigh equates more education with Raising the Bar (an ill-defined concept, I know, but one that most of us kinda ‘get’ in our guts). She asks what’s it gonna take.

What if the answer is something seemingly unrelated? What if the answer is a lawsuit currently making its way through the California court system? Let me explain.

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Antitrust Questions on MLS Decision to Screw With Syndication

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Having just spent a couple of days at CMLS, a young man’s fancy turns to questions of MLS-related things. In this case, a middle-aged man’s fancy might turn that way too, since it’s been a while since I’ve been a young man with fancy of any sort.

As most of my readers probably know, RealTracs, a large regional MLS in Nashville, recently made news:

By the end of the month, Brentwood, Tennessee-based RealTracs Solutions says it will limit the information included in direct data feeds it sends to public portals. RealTracs, which has nearly 10,000 members, is also in negotiations with listing syndicator ListHub to limit third-party portals’ display of listing data.

The changes include a four-photo limit; the elimination of several data fields; listing descriptions will be restricted to 150 characters; and public portals will be required to include a link to the listing detail page on the listing broker’s website.

As part of its reasoning behind the changes, RealTracs said consumers deserve a closer relationship with Realtors who provide the work product powering public portals, and brokerage websites can provide a more personal experience for consumers. The MLS also said brokerages should be allowed to manage advertising in ways advantageous to their companies.

Zillow has already said Nyet to the plan:

Now, White says Zillow has informed him it would reject any data feed that did not have complete data and would therefore terminate the feeds of RealTracs listings it receives from listing syndicators ListHub and Point2 on Sept. 23. Zillow is the most highly trafficked real estate portal on the Web with 46 million unique visitors via desktop and mobiles devices in June, according to comScore.

No response yet from Realtor.com, but Trulia has already said it’ll go along with the MLS’s wishes.

I have to admit to being some sort of strange real estate nerd in that this situation makes me wonder about a couple of antitrusty things. But here goes.

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Competition Is Not Tortious Inteference

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A brief note this Saturday morning…

Conversations around my last post, about FTC taking action on anti-competitive Code of Ethics provisions, have raised an interesting and salient point. The best example comes from the comments, where Brian Rayl writes:

Despite what the FTC states in terms of “soliciting other’s clients” there are very strict laws – federal laws – that prohibit interfering with a contract.

http://en.wikipedia.org/wiki/Tortious_interference

If someone is going down a list of new listings and contacting them with the intention of damaging the contractual relationship, they are guilty of tortious interference. I’m not sure why the FTC would require the code of ethics to allow this when the federal government doesn’t? What are your thoughts on that?

My thoughts are that tortious interference with contract requires a tort. Obviously, what is about to follow is legal mumbo-jumbo, which I do for fun as a blogger with a law background. Please consult your own attorney or counsel; this is not legal advice.

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