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McLean County not feeling sting of new appraisal rules

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New guidelines for home appraisers that were designed to eliminate conflicts of interest have instead created problems in many parts of the country. The backlash, though, has not been felt in the Twin Cities. (Pantagraph file photo)

BLOOMINGTON -- Controversy over new appraisal rules that some contend are undermining the housing market hasn't made its way to McLean County.

"We have not experienced any problem yet," said Brad Ropp, president of the Bloomington-Normal Area Home Builders Association.

The new rules, which took effect May 1, are geared toward elimination of conflicts of interest that could pressure real estate appraisers to inflate the value of property.

Backers said lenders and others have been known to pressure appraisers to hit the sale number a homebuyer and seller agreed on so deals could close. Inflated appraisals were partly blamed for fueling the housing bubble.

However, opponents contend that the new rules actually undermine home sales because some appraisals are coming in too low.

"We are hired to see if market value is met. It's not about hitting the mark," said Park, owner of Appraisal Services of McLean County in Bloomington.

"Sometimes appraisals come in at more and sometimes at less," said Park, in the business about 25 years.

Park said controversy over the changes is centered in metropolitan areas where there are a larger number of appraisers and loan officers and more pressure to hit a mark.

"Those of us who have been around have a longstanding relationship with lenders and are not having these issues," agreed Gail Winn, owner of Winn & Associates, a Normal appraisal firm.

However, Winn supports the National Association of Realtors in its attempt to impose an 18-month moratorium on the new guidelines.

The guidelines "should be postponed to knock out the bugs," Winn said.

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