“The reality is that the systems and structures themselves are, in some cases, problematic,” NAMB President Ernest Jones said in a statement. “Even when assessors follow the intended approach, it can result in outcomes that disenfranchise people. They may do everything in a way that they feel is consistent with the approaches they have learned and for which they are certified, but there are some underlying issues that need to be addressed.
Thank you for reading this post, don't forget to subscribe!Tackling appraisal bias has been a main concern of federal housing authorities during the Biden administration. When these AVM proposals were announced by Vice President Kamala Harris in June, she described the importance of tackling such changes as “systemic change that is needed.”
Last month, six federal agencies introduced a proposed rule that would enforce quality control standards that would govern the use of AVMs used by mortgage originators and secondary market issuers in evaluating real estate collateral securing mortgage loans.
The agencies involved were federal housing finance agency, consumer financial protection bureau, National Credit Union Administration, Federal Deposit Insurance Corporation, U.S. Department of the Treasury, And this federal Reserve System,
In a blog post released with the joint announcement in June, CFPB director Rohit Chopra said AVMs have the potential to cause serious harm if the algorithms are inaccurate or biased.
“Machines crunching the numbers may seem capable of taking human bias out of the equation, but they can’t,” Chopra said. “Depending on the data they are given and the algorithms they use, automated models can embed the very human bias they seek to correct. And the design and development of models and algorithms can reflect developers’ biases and blind spots.
