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| November 2003 |
A Publication of
ELLIOTT® & Company Appraisers |
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ELLIOTT® Offers
Complete Line of Risk Management Services |
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 ELLIOTT® & Company Appraisers is pleased to announce that
it not only
offers conventional appraisals, but also it now offers a complete line of
risk management services, including that of consulting.
It has become apparent that many of our clients have needs beyond that of
an appraisal, and we want them to know that we are not only here to
satisfy any appraisal needs they may have but that we are also available
to consult with them on their risk management needs in more of a holistic
way. Lately, the broader issue of collateral assessment and how this fits
into a financial institution’s overall risk management policy has become
a concern to many lenders. Recent government regulations concerning a
financial institution's risk management policies have been at the
forefront (see article below).
We perform a thorough examination of a financial institution’s existing
loan-collateral-assessment system to include products, policies, loss
experience, collateral-assessment tools and risk exposure. The results of
this audit are presented to management in the form of a comprehensive
real-estate loan, risk management audit report.
After a thorough audit of an organization’s existing risk-management
policies and systems, we design a comprehensive risk-management policy,
addressing all aspects of the organization’s risk exposure, as it pertains
to loans collateralized by real estate.
Financial institutions performing their own collateral-evaluation
management may choose to subscribe to all or part of an array of risk-management and collateral-assessment tools, which we offer. A
comprehensive listing of these tools, available for properties located
anywhere in the United States, may be found at our company Web site, where
these products can be ordered online. Our online order system provides
online tracking, offering the client 24/7 access status for each order.
Our management team is made up of many seasoned professionals with
advanced college degrees, professional designations and many years of
collateral-assessment experience. We have close working relationships with
other firms offering highly specialized support functions in areas of
technology systems, a resource that we can draw upon as required.
To find out more about ELLIOTT® & Company Appraisers’ Risk Management
Services call (800) 854-5889.
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Policing the
Selection of Appraisers |
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 The question of who has the right to select an
appraiser was recently addressed by five regulatory agencies.
The Federal Deposit Insurance Corporation (FDIC), Federal Reserve System
Board of Governors, National Credit Union Administration, Office of the
Comptroller of the Currency and Office of Thrift Supervision issued a
joint statement concerning this subject, excerpts of which are included
below.
According to the agencies, the borrower or anyone in the loan production
department of the financial institution should not be choosing the
appraiser.
“It is important to ensure that the program is safeguarded from internal
influence and interference from an institution’s loan production staff,”
the statement read. “Individuals independent from the loan-production area
should oversee the selection of appraisers and individuals providing
evaluation services.”
The agencies placed the responsibility for adopting and reviewing
appraisal policies and procedures on the financial institutions board of
directors.
It has not been unusual for borrowers and loan originators to select
appraisers and order appraisals. It will now be interesting to see how
financial institutions react to this statement and what changes may be
about to occur in the appraisal section process. |
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President's Comments
Risk Management, Collateral Assessment and the Appraisal |
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 The
concept of risk management seems to be on the minds of most
everyone in the mortgage industry today. While appraisals play
an important role in reducing the risk of an individual loan,
the scope of risk management is much broader.
The appraiser’s role in preparing an individual appraisal is
contained and restricted to that of the individual property and
those influences surrounding it, a somewhat micro approach to
risk management. Most financial organizations view risk more in
a macro way, one that encompasses larger numbers of properties.
They concern themselves less with the value of a single property
and more with that of multiple properties, which they have in
their loan portfolio. Also to be considered are such issues as
the product inventory, management policies, loss experience and
alternative assessment tools used.
All financial institutions should have a
collateral-assessment-risk-management policy designed to address
the risk associated with the loans, which they make, as well as
a separate and more-broad macro-risk-management policy, which
addresses risks not associated with the collateral of loans. It
is like a screening process to eliminate problem loans prior to
their occurrence.
In today’s complex and competitive sociological, financial,
political and legal environment, financial institutions are more
dependent than ever upon a collateral-assessment program that
not only helps manage the organization’s risk exposure but also
lends itself to meeting the competitive demands of today’s
borrowers. Given all of the constraints of the mortgage
business, a collateral-assessment-risk-management policy
emphasizing the unique requirements of each financial
institution is a must. |
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In The
News |
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Experts Predict
Great 2004 For Housing
Economists for the National Association of Realtors are
predicting a strong housing market, once again, next year.
“The housing sector boom is not a short-term phenomenon,” said
NAR senior economist David Lereah at the association’s annual
conference in San Francisco.
The NAR estimates that almost 6 million existing homes, a record
high, will be sold this year. Ten years ago less than 3.8
million were sold.
“There’s more to that than just low interest rates,” the
economist said. “We have had a surge in immigration over the
last several decades. Thirty years ago, when immigrants came
into this country, it took them decades to participate in the
home-buying process. Today when immigrants come, they
immediately think about buying a home.”
Appraisal Bits: The Department of Veterans Affairs
announced that it plans to add 2,000 appraisers to its approved
roster within the next two years. … The Appraisal Institute,
National Association of Realtors and American Society of Farm
Managers and Rural Appraisers sent a letter to the Internal
Revenue Service formally requesting that IRS appraisers use the
Uniform Standards of Professional Appraisal Practice become the
cornerstone of IRS appraisals. … The Office of Appraisal
Services was created by the U.S. Department of Interior,
consolidating functions previously handled by various agencies
within the department. Brian Holly, MAI, chief appraiser for the
U.S. Department of Justice was named acting chief appraiser for
the Interior Department. |
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Quotes
of Wisdom and Wit |
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“Human beings, by changing the inner
attitudes of their minds, can change the outer aspects of their
lives.”
– William James
“The smaller the mind the greater the conceit.” – Aesop
“All you need in life is ignorance and confidence. Then success
is sure.” – Mark Twain
“The right to swing my fist ends where the other man’s nose
begins,” - Oliver Wendell Holmes
“Courage is doing what you’re afraid to do. There can be no
courage unless you’re scared.” – Eddie Rickenbacker
“A pint of sweat saves a gallon of blood.” -Gen.
George Patton
“We are not retreating. We are advancing in another direction.”
-Gen. Douglas MacArthur
“Beware of the young doctor and the old barber.”
-Benjamin Franklin
“Equal opportunity means everyone will have a fair chance at
being incompetent.”
– Laurence Peter
“Computers are useless. They can only give you answers.”
– Pablo Picasso
“If the automobile had followed the same development cycle of
the computer, a Rolls Royce would today cost $100, get a million
miles per gallon and explode once a year, killing everyone
inside.” – Robert Cringely
“When they discover the center of the universe, a lot of people
will be disappointed to learn that they are not in it.”
– Bernard Bailey |
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ELLIOTT® & Company Appraisers
currently offers appraisal service throughout all 50 of the United
States. Clients are encouraged to place orders directly to any
office local to properties to be appraised or to the central office
for assignment.
Orders may
be placed via telephone, fax or through the company's Web site. All
Internet orders will be processed through the central office.
Some
Offices Are Independently Owned and Operated
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3316-A Battleground Avenue
Greensboro, NC 27410
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