The good news here is, since around 2012, valuation
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of state license complaints, regulatory investigations,
and liability claims, in some areas, less than a
quarter of what was in process from 2010-2012.
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Llano Financing mass litigation phenomenon in
2015, but those are a rarity. At least as far as legal
actions for valuation professionals go, you’re all
presently living in the “good times.” In my line of
work, I’ve cynically concluded that those times
don’t last.
Liability claims and license complaints peaked,
logically, several years after the real estate market
collapse. As is commonly the case, dissatisfaction
with results (either consumer or lender) will lead to an
uptick in licensing complaints that are often followed
by lawsuits. The Great Recession was that model on
steroids. Once property values stabilized and began
rising, as well as distressed inventory began clearing
42 | APPRAISAL BUZZ FALL 2019
out, the litigation surrounding those issues reduced
to a trickle.
Certainly, by now, nearly everyone reading this
publication has become aware of a general market
slowdown in late 2018 and entering into 2019. While
this trend may not be present in every locale, should
it persist, this would be the sort of event that might
give rise to new claims not too far down the road.
Properties lingering on the open market, price
reduction, a failure to close loans (whether for
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dissatisfaction that leads to claims and complaints.
When that happens, history tells us everyone
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the transaction may be wearing a target.
At the same time that appraisers were getting batted
around in courtrooms during the Great Recession,
appraisal management companies provided a layer
of insulation between the lender and the appraiser
WORKING TOGETHER
/fast
