Dear Loan Officer,
I met you briefly at the SAR meeting and I thought you said you worked for Chase, but perhaps I mis-heard. At any rate, when you mentioned that you were looking for appraisers that "don't check the box", I assume that you were talking about Stable Vs. Declining market check boxes on the URAR 1004.
Most lenders, CAR, NAR and FNMA have identified Sacramento, San Joaquin and Placer counties generally as "declining". Since none of these entities specifically defines what a declining market is, the burden of proof is on the appraiser to demonstrate stable or declining values based on historical, recent and current sales analysis.
Part of my job as an independent fee appraiser is to determine how the subject's neighborhood fits into the market. As we all know, each neighborhood is distinct and, while the market, county or zip code as a whole may be declining, the subject's neighborhood may at the moment or for a definable period be stable. If evidence exists that the subject's neighborhood is stable, then the Stable box can be checked as long as the appraiser fully supports that decision with market data, paired-sales data analysis and even graphing the data if necessary to show the period of stability.
If the subject's neighborhood is truly declining, then the Declining box must be checked, and that decision also must be fully supported by the same method of data analysis as noted above.
In any case, if the wrong (Stable or Declining) checkbox is marked, the lender's underwriter or reviewer will condition the appraisal or reject the appraised value based on their own underwriting guidelines, especially if no supporting data is in the report to justify why either box was checked.
I always base my decision on my own independent research of each subject neighborhood and fully support that decision in the report. I don't automatically check either box which, if wrong, could lead to a rejection of the appraisal or a review that could end up costing the borrower or delaying the loan.
I hope you don't mind that I took the time to respond to your question in a way that may clear up some of the confusion about Stable Vs. Declining markets and the appraiser's responsibility to accurately report and support market conditions.
Thank you, we'll be in touch!