Today we spotlight the appraisal process. CoesterVMS is a nationwide appraisal management company that specializes in providing comprehensive management of appraisal operations for mortgage lenders. CoesterVMS’ in-house appraisal management solution combines the best service with the most advanced technology on the market. CoesterVMS guarantees all appraisal reports to fully comply with all regulations and guidelines. CoesterVMS CEO Brian Coester had this to say about the changing face of the appraisal process:
Q: Tell me what is going on at CoesterVMS today.
Brian Coester: Things are going very well at CoesterVMS. I know it sounds like a cliché, but it’s a great feeling to come to work every day and move the company and industry forward. We’re finally able to put into process all of the ideas and concepts for our customers and appraisers that we’ve been talking about and developing for the past few years. When we started, we purchased the applications we needed from other vendors, from appraisal management software to quality control software and using the standard integrations from all the LOS providers. During the past few years, we’ve been able to replace everything and build our own systems from scratch. As a result, we’ve developed a huge competitive advantage. Lenders are seeing our technological advantage. We’ve boarded more than 300 individual clients year to date and are currently adding three to four users per day. We have a complete solution for our clients, and we can control the entire process from end to end. However, with all that we do, we put customer service at the top of our list as we focus on providing great service to all of our clients and appraisers.
Q: I hear that the company has had some issues with specific states can you tell us about that?
Brian Coester: I got into the appraisal management business as a field appraiser with a focus on providing quality appraisals to our lender clients. As a result, we experienced extremely explosive growth that was well beyond what I expected. During that time, we had oversights in administrative issues in a few states. Most of the issues came down to a misinterpretation of a state regulation. In all of those cases, once we identified the issue, it was immediately fixed. Furthermore, these oversights happened as regulations were newly implemented in 2010 through 2012. Since then, we have made compliance a priority. We submit to a third-party audit on a quarterly basis and have an extremely comprehensive compliance management system in place overseen by our internal auditors, compliance managers and legal team.
Q: Where do you see valuations in the new mortgage landscape after the industry meltdown?
Brian Coester: Valuations have been always been a vital part of the mortgage industry. I love what Fannie Mae has done with Collateral Underwriter, and I am excited to see Freddie Mac and ultimately HUD implement similar technologies. I think the industry meltdown was a great wakeup call for the appraisal industry and mortgage lending relationship. Everyone quickly realized just how fragile the relationship is and how easily processes can get off track without proper oversight. Appraisal management companies will become a larger part of the process in the coming years and the idea of a lender managing it in-house appraisal staff will be a distant memory.
Q: What do you think it will take to truly get the industry on an upward trajectory?
Brian Coester: Valuations are at a turning point. The existing model does not work and many of the requirements need modification in order to move in a positive, upward direction. The first change is implementing less restrictive requirements to become an appraiser and more duties given to trainees. Second, the Uniform Standards of Professional Appraisal Practice (USPAP) definition of an appraisal needs to be broaden in scope. Currently, the definition of an appraisal according to USPAP is too burdensome to realistically allow alternative reports with lower price points to be used for HELOCs. Finally, we need to take a serious look at the way both AMCs and appraisers are regulated and how they function within such an environment.
Q: Where do you see CoesterVMS in three years?
Brian Coester: We’ve got so many amazing things in the works right now. It’s going to be great to see it all come to market during the next few years. We are in the process of developing several applications that will further meet the needs of lenders. In addition, we are working to further enhance our relationship with our network of appraisers.
Tony Garritano is chairman and founder at PROGRESS in Lending Association. As a speaker Tony has worked hard to inform executives about how technology should be a tool used to further business objectives. For over 10 years he has worked as a journalist, researcher and speaker in the mortgage technology space. Starting this association was the next step for someone like Tony, who has dedicated his career to providing mortgage executives with the information needed to make informed technology decisions. He can be reached via e-mail at firstname.lastname@example.org.