In Oregon, a Victory for Automated Evaluation
Julavits, Robert, American Banker
Proponents of automated property evaluation are hailing an Oregon legal settlement as a breakthrough for the business and a boost for online mortgage lending.
The October settlement with the Oregon Appraiser and Certification Licensure Board lets a Massachusetts unit of Fidelity National Financial Inc. keep making automated evaluations in Oregon for banks' internal use, as it has done for several years.
"This is the beginning of speeding up one of the slowest pieces of the mortgage process: the appraisal," said Mark Sennott, president and chief executive officer of the company, Market Intelligence. "We hope that Oregon is the test case for other states that are looking at this issue, and that ultimately the forces of change will prevail."
Market Intelligence, formerly Chicago Title-Market Intelligence, is based in Hopkinton, Mass. Fidelity National Financial is based in Irvine, California.
In April the board fined Market Intelligence $445,000 for what it said were unlawful appraisal activities. It cited a 1991 Oregon law that says only a party authorized by the Appraiser Board -- as Market Intelligence was not -- can render an "opinion of value of property."
Market Intelligence replied with a suit accusing the board of flouting federal law. It argued that the state law applies only to full appraisals, and that under regulations adopted by the four federal banking agencies in 1994, banks do not need full appraisals for transactions of less than $250,000 -- mere evaluations will do.
The company also appealed to the court of public opinion. It said that evaluations cost substantially less than full appraisals -- $70 versus as much as $400 -- and that the board was using the Oregon law to help line the pockets of the state's appraisers. …