1997-2007

NDC Celebrates its Tenth Anniversary

 

 

Ten years ago, in the year 1997, new appraiser Maurice Silva spent several hours of every evening hunched over a machine that by today’s standards would seem to have more of a place in “Jurassic Park” than in an appraisal office. The machine was a microfiche reader, and it looked like a cross between a photocopier and a large desktop computer. The data was printed onto small, flat sheets of film that were magnified by the microfiche reader. Silva used the microfiche reader and phone book-sized MLS reports to do comp checks. “I was an apprentice, so I did it for free. I was looking through two or three books and the microfiche to get comps. It took at least an hour a piece. Once a month the updated MLS used to come out. Each page was broken down into areas and you went through it page by page. If it wasn’t in the book, you drove up and down the streets,” Silva said. Using the microfiche reader was time consuming and frustrating. “They’re extremely hard to read. You were always refocusing,” Silva said.

 

While Silva was refocusing the microfiche reader, FREA national director, Tom Dean was focusing on a different setback in the appraisal process. For two years he had been hearing growing talk about a new product called an Automated Valuation Model (AVM). “The National Data Collective (NDC) was conceived on the golf course. I was playing with a local appraiser who had been asked to evaluate a new product called an AVM. A bank was thinking about using these automated appraisals and wanted to see just how accurate they were. My golf partner told me that he had gone by one of the houses that the AVM had estimated to be worth $175,000. He could not believe what he saw; the house was boarded up and was being used as a drug house,” Dean said. “I was so shocked by this that the next issue of the Communicator was dedicated to this potential disaster that the lending industry was considering using.”

 

Undeterred by the negative press and appraiser skepticism, lenders continued to clamor after AVM’s. Over time, Dean recognized that AVM’s were slowly making their way into the market. “The AVM industry was starting to convince the lenders that their product was accurate and that the magical algorithms that had been created were as good as, if not better than, the potential human error appraisal,” Dean said. Dean became increasingly concerned about how AVM’s would affect the quality of the data and appraisals, not to mention how the automated model would affect appraisers’ businesses. “The answer was simple; appraisers needed to obtain and maintain the best data available and then educate the lenders. The appraiser who utilizes the best data will produce the most accurate results. NDC’s philosophy is ‘Control the data, control the market,” Dean said.

 

For two years, Dean struggled against groups of appraisers who told him that a national data collective was an impossibility. As much as appraisers liked the idea of having a centralized system that allowed them to update, store, and access data, they just didn’t believe it could be done. “I remember the first time I stood in front of a class of appraisers and told them just what NDC was going to do. After I was given all their reasons why it wasn’t going to work, I really thought about not moving forward with it,” Dean said.

 

For awhile, it looked like the skeptical appraisers were right. Dean describes the initial efforts to collect and store data as a “mammoth task.” “In California alone we had to deal with over fifty assessors’ offices that delivered their records in different formats as well as on different time schedules. The plat maps and flood data were a whole different nightmare. But, we were determined to move forward,” Dean said. “NDC was almost bankrupted by programmers who didn’t know how to handle the task…of processing and handling enormous amounts of data. Then, we found the right programmer and within two weeks NDC was up and sort of running,” Dean said.

 

Once the company was “up and sort of running,” John David, “JD,” Peterson was hired as NDC’s director of marketing. Together, Dean’s perseverance and Peterson’s marketing and business development skills turned NDC from a struggling ambition to the tool appraisers had been afraid to hope for; and the transformation seemed to happen almost over night. “We went from a handful of customers to thousands,” Peterson said.

 

Tired of long nights alone with a microfiche reader, appraiser Maurice Silva was one of the handful who took a chance on NDC and “JD” as Peterson has come to be known by appraisers.

 

“JD had an ad in one of the magazines. It was almost something that was too good to be true, so I tried him out,” Silva said.

 

Like Silva, appraiser Derrick Carbon used microfiche before data became available online. “I had to buy it [microfiche] per county. It was $600 per county and the data was updated once a month. That’s when we hand delivered appraisals and glued pictures on to the reports,” Carbon said. In June of 2000, Carbon’s data provider discontinued its microfiche, and he had no choice but to look for an online data source. He attended an NDC training course taught by Ross Acheson, director of training for FREA. “Data sources were so expensive. I took one of Acheson’s NDC classes and it was unlimited use for $132,” Carbon said.

 

NDC’s overnight success is due, in large part, to appraisers like Carbon and Silva and to Peterson’s face-to-face business approach. He has an open door policy and answers as many customer support calls as he can when he’s not on the road at tradeshows or teaching training classes.

 

“Our customers are the most spoiled customers in the world,” Peterson said. “I once had a guy call me because he left all of his comps back at the office. He was 100 miles out and completely panicked. I looked up the comps and read them to him over the phone,” Peterson said.

 

Eight years after he became NDC’s director of marketing, NDC users and other appraisers will still find “JD” standing in front of a booth display that features a large, flesh colored cartoon dinosaur with sharp teeth and a mouthful of half-eaten appraisers. The dinosaur is NDC’s unofficial mascot. At first, he represented appraisers who were being eaten alive by overpriced data providers.

 

“When JD came along some people had started to use DataQuick and it went online, but it was really expensive. CMDC went online too. Then JD came out with plat maps on CD,” Silva said.

 

As NDC grew and “JD” and his dinosaur became familiar to thousands of appraisers, the dinosaur came to represent the end of an era in which appraisers like Maurice Silva were also eaten alive by long hours spent refocusing a microfiche reader.

 

“NDC has made things much quicker. A lot of times we get calls for comp checks. You can pop it up into NDC pretty quick and check the comps. With NDC it’s pretty instantaneous. You get in, you do your work, and you come back to your customer,” Silva said.

 

“One of the recent additions that I really like is using the square footage of the first and second floor. I really like the ability to get flood and plat maps. It’s intuitive; it’s pretty straightforward and the learning curve is very low,” Carbon said.

 

While NDC streamlines Carbon and Silva’s work as appraisers, Tom Dean and “JD” Peterson continue to streamline NDC. “We presently have complete data in fourteen states—Arizona, California, Colorado, Florida, Georgia, North Carolina, New Jersey, Nevada, New York, Ohio, Oregon, Pennsylvania, South Carolina and Washington. We offer unlimited searching statewide including comp location maps, flood maps and plat maps,” Peterson said.

 

After ten years, NDC has thousands of loyal customers, but the company is not resting on its laurels. “We have now implemented our form population program which allows all the data you have selected for your subject and comps to automatically populate your appraisal report. This will save the appraiser twenty to forty-five minutes of manual typing. This program will also pull in the plat map and location map for the comps,” Peterson said.

 

In another ten years, it may seem archaic that appraisers Maurice Silva and Derrick Carbon once did comp checks from a desktop computer. It will be even more unimaginable that a clunky microfiche reader once sat atop the same desk. For the thousands of appraisers who are celebrating NDC’s tenth anniversary, the machinery doesn’t matter as much as knowing that NDC will continue to update and perfect its system.

 

“I like that he’s [JD] breaking it down and putting even more information in. It’s new and it’s important. NDC is evolving as well and I appreciate it,” Silva said.

 

“NDC is a reliable, accurate data source and that’s important because we’re only as good as the data source we use,” Carbon said.