Quality Mortgage Services LLC (QMS) has announced the release of its Appraisal Defect Detection and Prevention (ADDP) product, a solution can be deployed by a lender or by QMS on an outsourced basis that seeks to eliminate appraisal report errors and defects. QMS will provide free mortgage repurchase defense or mortgage put back rebuttals regarding loan collateral if any such request is made by an investor on a loan where ADDP was used.

“We’ve been in the quality control business since 1992 and we know that many appraisal related issues are not the result of increased valuation fraud, but rather defects in the appraisal report,” said Tommy A. Duncan, president of Quality Mortgage Services LLC (QMS). “We developed the ADDP technology and related methodology to empower our own loan auditors, but in today’s environment, every underwriter should have access to this tool.”

Duncan maintains that most underwriters are not trained to find every possible appraisal defect and that leaves lenders open to increased risk. As appraisal-related rules and regulations continue to impact the industry, ADDP is expected to be used by more underwriters, especially since it is available at a low per-loan cost. In addition to underwriters working in mortgage companies, ADDP is also expected to be adopted by appraisers interested in ensuring the quality of their product without relying on expensive AMC quality control (QC) personnel; community banks and credit unions that don’t have trained QC staff in house but don’t want to pay high outsourcing fees; and appraisal management companies (AMCs) interested in performing QC on the valuation reports they provide to their lender clients.

"There are a lot of community banks and banks that are doing their own underwriting and I feel many of them are becoming complacent," said Duncan. "ADDP would provide them with a stronger underwriting decision. We have some community bank clients that are small and basically, ADDP enables the underwriter to reduce their risk."