I will make this short and ask a question to the board. If the observation has been required by the appraiser or "their" trainee up until this point - then what has changed and why would you allow it to change if it has been such a requirement prior to this discussion?
When I do an observation I ask the borrower lots of questions to help me feel better about the security that I was contracted to do. The borrower also has questions about the appraisal process, which is just good bedside manner to answer and I believe it sometimes prevents a possible inquiry to the board after the appraisal has been sent. They sometimes don't understand why some of the sales in their neighborhood and nearby areas are just sales and not competitive properties. This is just one example there are many others (i.e. above grade GLA, bedroom count, 2nd kitchen requirements, personal properties vs. real property - I could go on and on). If just an inspector shows up they will not be able to answer these questions professionally. This will lead to lots of misunderstandings and more complaints to the broad about appraisers who never entered the property.
It appears that the banks do not understand with online applications that the professional appraiser is the only personal contact that the borrower has and they are very accustomed to this. The inspectors will only have limited knowledge probably the cheapest they can find, maybe they will not be dressed properly, rude and not spend the needed time to do a proper observation or know how to ask questions respectively to get the information needed for some touchy subjects, like permits, repairs and cracking and peeling paint, just to name a few. The drawing and the specs could be confusing which will require more work for the appraiser calling the inspector and cost more time and no extra pay.
It appears to me that the banks want to use my brain for a fraction of the price that they charge the borrower, which I believe in the future will be the same as it is today and they will keep the extra money. At this time I only have six to seven days to complete an assignment and that includes weekends and if I cannot do it they will find some else. So, I do not understand why they say appraisals take a long time.
I think the focus should be on closing costs which are now typically three percent of the sales price, along with the realtors six percent, that is nine thousand per one hundred thousand and I typically get $400.00.
In closing, I doubt that inspectors will be required to know "all" of the FNMA and FHA requirements. Would you trust one of these inspectors to do an observation on your largest investment of your life? Or would you like the person doing the valuation to do the observation?
Hybrids are good for the environment - not the consumer.
Chris Lang / Certified Appraiser