Why Reggora’s 24-hour appraisal is going to become "the new standard”

HousingWire

Is the appraisal process slowing down your mortgage closings? Regora CEO Brian Zitton unveils their groundbreaking 24-hour appraisal, poised to revolutionize the industry. Learn how this innovation tackles bottlenecks and aims to set a new standard for speed using hybrid appraisals.  Discover the technology and infrastructure behind this game-changing solution. Brian explains how Regora's appraisal platform, nationwide AMC licensing, and a network of trained data collectors are streamlining the process. Find out how their mobile app and data-driven approach ensure accuracy and efficiency.  Explore the impact on borrowers and lenders nationwide. Hear how quicker appraisals can lead to faster closings and a smoother mortgage experience. Get insight into the future of property valuation and how Regora is leading the charge.  #mortgageindustry #appraisalprocess #realestate #regora

Transcript

00:00Live from Las Vegas, I'm Diego Sanchez, president of HousingWire, and I'm joined today by a special

00:14guest. It's Brian Zitton, the CEO and co-founder of Regora. Brian, so great to chat with you today.

00:21Thank you for having me.

00:22Well, you recently announced kind of a big announcement, 24-hour appraisals. Tell us about

00:28it. So, I mean, I'm sure as you've heard throughout the last couple of decades, appraisal has always

00:34been kind of like the bottleneck around everything. People have always said it's like the slowest part

00:40of the process. And Fannie and Freddie have introduced new ways to try to combat that,

00:45whether it was waivers. But even if you remember like 2021, the crazy refi boom, appraisals were

00:50taking literally weeks. So it was holding up everything. And that was when appraisal waivers

00:55were at like 40 percent. And they've come down substantially. So today, appraisal is still an

01:00issue, especially for those lenders who are trying to do quick closings. Like some of our top customers,

01:05their goal is 10 to 14 day closings. And if the appraisal is taking five to 10 days, it's going to

01:10prevent that. So we made it our mission to see how we can reduce the turn time as much as possible.

01:16And so we just announced a 24-hour appraisal. It's eligible on 80 to 90 percent of all conventional

01:21transactions. So this isn't like, oh, we're going to do it sometimes or in this specific situation.

01:26Like this will be the new standard of how appraisals get done moving forward.

01:31And so, yeah, super excited about it.

01:33It's pretty amazing. What kind of infrastructure and processes and technology did the Regora team need to build

01:42to make this a possibility?

01:44A lot. I mean, we, over the lifetime of Regora, have raised $80 million. Most of that has gone into

01:51engineering, R&D, you know, building out everything. So we have our core appraisal platform, which is

01:58what, you know, our hundreds of customers use today to manage the full A to Z appraisal process. Then

02:02what we realized was, you know, no matter how much software we build, if we're not in control of our own

02:08destiny in terms of fulfilling the appraisal, there's only so much we can do. So about two and a half years

02:13ago, we launched our own appraisal marketplace. It's licensed as an AMC in all 50 states. So we

02:19can actually fulfill appraisals as well. So we have the core software, the fulfillment. Now the 24 hour

02:26appraisal is a hybrid appraisal. And so what that means is someone who's not the appraiser is doing

02:32the actual inspection. Okay. And then they send that inspection data to the appraiser who does the

02:38report at their desktop. So basically the workflow, let's say that, you know, your bar, we're going

02:45through a refi, let's say, or a purchase way earlier in the mortgage application process,

02:51we're going to send someone to the property to do data collection for free. We won't charge you or

02:56the lender anything. So that when you are finally ready to order the appraisal, it's all done. And

03:01we're just sending it to the appraiser who's finishing at their desk. So that required us to build

03:06a mobile app for the inspection to do like a LIDAR scan, gather all the information.

03:11So it's literally the full thing from ordering, fulfillment, inspection, the appraiser portion

03:16of it, everything A to Z. So tell us more about those data collectors,

03:20because that's an interesting new part of this process. Are they, how are they trained? How are

03:25they certified to go out and collect the appropriate data? Yeah. So Fannie Mae and Freddie Mac

03:30have set these standards. And there is a very specific data set that has to be gathered called

03:36the uniform property data set. So our mobile app is in, you know, aligned with that. And then these

03:43data collectors are real estate professionals, whether it's like a real estate agent, insurance

03:47adjuster, foreclosure occupancy specialist, people who have already familiar with real estate. They go

03:53through our own training program. We background check them. They're using our own technology.

03:57We have like vendor scorecards. So we know who's good, who's bad, all that sort of stuff. So we

04:02can use the best of the best. And then they go, they follow the mobile app, kind of like TurboTax.

04:07Okay. You can imagine going through a property, going through various checkbox, take a picture

04:10of the bathroom, take a picture of this, do this. And then it spits out the, you know, magical UAD

04:17data set. So they're walking around the property with some kind of handheld device. And that device

04:22is telling them do this next. Okay. And okay. So they've collected the data. Is there a time limit

04:29for how long of a time period between when the data is collected and when the appraiser actually

04:35does the evaluation? That depends on the speed with which the borrower moves through the transaction,

04:41some of the timing with the mortgage lender workflows. So let's say you are applying for a

04:45refi. We could send the data collector out right away. And then it takes you, you know, another week,

04:51we can have to get all your documents together, everything. Now you're ready to order the

04:54appraisal. Boom. We just send it to the appraiser, turns around 24 hours. So it kind of depends on

04:59you, the borrower, the workflow of the mortgage lender. But the goal is the inspection's done

05:04well in advance of the appraisal so that by the time you do need it, it's already done.

05:09So with this 24 hour commitment, is this a geographic or regional commitment or is it a nationwide

05:16commitment? So it should be nationwide because if you think about how long it's

05:21takes the appraiser to just create the report, like most of the turn time of the appraisal

05:25today, scheduling the inspection, going to the property, you know, finding the comps.

05:29But when you're actually creating the report, most appraisers get it done in three, four

05:34hours. So if we're giving an appraiser, here's everything you need and turn around in 24 hours,

05:40you know, they should be able to do that. And so there's nothing preventing this from being

05:44done nationwide. And is it a commitment that you make on both the software side of your

05:51platform and the AMC side or is it just focused on the appraisers that you control through

05:55the AMC? This has to be done through our appraisal marketplace because obviously we need to be

05:59the ones coordinating all the logistics of this. So customers of our software would then

06:05use our appraisal marketplace to get these 24 hour appraisals done. Got it. So tell me more

06:10about this appraisal marketplace. It's been in operation for how long now? Two and a half years.

06:15Two, two and a half years. How's it going? What have you improved on over time? What areas

06:22were there gaps that you had to fill in? Tell me more about the marketplace.

06:25So let me just give you the quick genesis of it. Like I said, we had this very robust automated

06:30software, but we were not in control of our own destiny when it came to fulfillment. And when a

06:35lender is trying to find the right appraiser for the right job, they're only using their own data

06:40versus we have data across hundreds of thousands of transactions, right? So imagine Uber and Lyft,

06:46but instead of, you know, high level algorithms, it's like a thousand different taxi dispatch

06:51companies, right? So we are the Uber type approach. And so we have all this information about the

06:58whereabouts of these appraisers, what their schedule is. And so it started off just in traditional

07:02appraisals. It is the most used vendor across our entire platform. So it's high to high level of success.

07:08If the normal appraisal is taking five to 10 days through our appraisal marketplace,

07:13it's generally anywhere from 20 to 30% faster. And then we took it to a whole other level with

07:19the 24 hour appraisal, obviously. So, but it started with that.

07:22You know, I've always been faceted with Regora because you are working to speed up an industry

07:28that has a shrinking workforce, an aging workforce. How do you do that?

07:33I mean, this will be a controversial message, but that is the entire reason.

07:38Well, not the entire reason, but one of the main reasons Fannie and Freddie added these,

07:42if you think about hybrid appraisals, let's say I'm an appraiser and I can do two or three a day

07:47of these just at my desk before I could only do maybe one, one a day. So the, the number of

07:52needed appraisers is going down because the individual appraiser can be so much more productive

07:58now, just doing the analysis portion of it. And so that's what these, these products are purpose

08:03built for a declining appraiser population.

08:06Have you seen any friction between data collectors and the data that they produce

08:12and appraisers? Some, some of whom have been working with clipboards for a long time.

08:17As you can imagine, there are the appraisers who are like, I will never do this. And then

08:20there are appraisers like, I love this and I only want to do these. Right. We did a poll

08:24across tens of thousands of appraisers. The majority wanted to do this. Um, there will of course,

08:30always be, we need to stay on top of quality and make sure the data collectors are doing

08:33a good job. And maybe one slips through the cracks where we need to address it, reorder

08:37it. But on the whole, we have analytics, quality process training to ensure that the data collector

08:43and the appraiser are working happily together.

08:45Yeah. All right. So you mentioned 80 million in investment over time in the business, a lot

08:51of which went to technology, including a recent round of 18 million. What are you doing with

08:57that money in terms of what are you building for what comes next after the 24 hour appraisal?

09:03What are you going to launch in 2026? That's going to keep things rolling.

09:06That's just, that is a little bit of a secret. Uh, there will always be more. I mean, that's

09:10the unique thing about Regora. There are not many as tech focused companies in the appraisal

09:15industry as us. A lot of that money is going to just pure engineering, making the product

09:19better and better every day, whether it's improving some of the logistics, making the, you know,

09:23experience more frictionless. Um, and so we do new releases every two weeks. So we have

09:27a lot to do all the time. Um, and so most of it just continuing to grow our engineering

09:32team product, our support team, just, you know, you can imagine we've getting a lot

09:36of demand. Um, and so just being able to scale up the company and, you know, be able to do

09:42that in a way where it's financially comfortable and easy.

09:44I mean, there are so many lenders that are trying to differentiate on that speed to close.

09:48I have to imagine this is a big opportunity for you.

09:50That's what I'm saying. It's going to be the new standard. Like it just, if you can

09:53get the same thing, order an appraisal and get it done in six days or 24 hours, what

09:58are you going to do? Right? So people are going to go to the 24 hour.

10:00Well, Brian, it's always great to catch up with you. Thank you so much for joining me today.

10:04I appreciate it.

10:04Yeah.

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