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Appraisal Fees Matter

From the Washington Post, an article discussing the negative ramifications of AMC’s offering low appraisal fees:

But some prominent appraisers are scathing in their criticism of management firms. “Their quality is terrible — all they want you to do is crank it out at the lowest cost,” said Jonathan Miller, president and chief executive of Miller Samuel, one of the largest appraisal companies in the New York City area. Only “the least experienced people” are willing to do the work, he said, “and the product is unreliable.”

George Dodd, an appraiser based in Virginia, said “the most experienced appraisers [will be] the hardest hit” by the new code “because of our unwillingness to sacrifice integrity and quality.” Rather than work for peanuts, Dodd said, “I can flip burgers at McD’s for more.”

Where is all this headed? The National Association of Mortgage Brokers plans to appeal to Congress to reverse the code’s ban on broker selection of appraisers, and it is considering a lawsuit challenging the code. Appraisers also are expected to seek changes, either from Fannie and Freddie’s regulator, or from Congress.

Why should this matter to you? Miller says quick, slipshod appraisals can severely undervalue some properties — forcing buyers to come up with bigger down payments — and can scuttle refinancings. Or they can overvalue houses that should be selling for less.

Either way, it matters.

It is good to see an article that clearly states why appraisal quality is necessary to maintaining the health of the housing industry. And, let’s be honest, you don’t get quality without paying for it.

Comments
  1. Mary McCullough

    I couldn’t agree more. The mortgage companies offering refinance or those looking toward foreclosure frequently recruit real estate brokers for BPO, Broker Price Opinions, and their pay is so low they frequently get new agents – who are not brokers – simply because nobody else will put in the time for a good evaluation.

  2. John

    THe appraiser who are up in arms over HVCC are the larger firms who employ staff appraisers and pay even less than the AMC’s per appraisal. I do work for AMC’s and my quality is good and I don’t skimp because of the fee. It’s still more than what I can make working for another appraiser.

  3. Donne Lail

    I seldom do work for management companies. That may change. But it has always been my practice and I’m sure everyone else’s to give priority to those paying full fees instead of half fees. We experienced appraisers are just going to have to make a business decission… are we going to uphold our fee and let the AMC add their fee on top of that for their service to the clients price. If their service is worth so much it shouldn’t be any problem for the client. I plan to continue pricing my fees at full price or go out of business.

  4. I just got an order for $200 to do a full appraisal in Port Aransas, Texas. That is about 50 miles away! I can not afford to take that fee! A quality appraisal takes 2-3 days to complete! I really do not know if I can remain in this profession.

  5. It is simply not possible to do a USPAP compliant appraisal for $200 and a turnaround requirement of 2-3 days. Appraisers who are doing this are simply plugging in MLS sales without verification or any true research. To properly research 9 or 10 sales, including private non-MLS sales, and make the necessary phone calls to verify sales concessions, home inspection concessions, etc. simply cannot be done for this fee and turnaround. AMC’s do not care about quality and will not pay for it. They want a “number”, they want it quick, and they want it cheap. Many of these appraisers who work for these fees and crank out what they call “appraisals” would probably lose their licenses if these reports were peer reviewed.

  6. The bottom line is the old addage, “you get what you pay for.” One reason the marketis in it’s current situation is due to incompetent unethical appraisers and lenders. These Appraisal management companies are taking advantage of their power with the representatives, filling their pockets and sending the investors down the river in a sinking ship. There needs to be harsher penalties for appraisers and lenders that “work the system” without any reguard to the end result for the investors. I was under the impression that it was illegal for a company to charge more for the appraisal than was being paid to the appraiser. Someone really needs to investigate who the owners, shareholders of these companies are I think that with minimal effort they would find that they are owned by the Mortgage companies heigher eschelon.
    It’s sad that with 30 years of experience over 2,000 classroom hours and over 32,000 residential reports completed they would tell me that I need to take a pay cut or they will give the work to someone less qualified that will do it for less pay.

  7. A Utah State Certified General Appraiser

    Most appraisers are committed to professionalism, accuracy, and excellent customer service. Fast turn times and low fees can affect completeness and accuracy. But more important, low fees do not make it profitable for “professionals”. Hourly rates of $8 to $14 per hour, in most locales, are not what people with licenses and college degrees expect and often, willing to accept.
    The high ethics are necessary for good appraising, which is essential to the real estate business, and the hope of the American dream. Business decisions should be determined by real costs to pay for professional help, ‘reserves’ for each assignment to pay taxes, insurances, future capital costs, etc. (& do need to be achieved in each assignment), and PROFIT (yes profit) for participants, partners or ‘just because’ it is an important factor for success and enthusiasm – when times are slow and yes, continuing education does cost money!
    In short, if you are professional, poor quality work is never an option. When low appraisal fees are offered, consider the “dollar per hour” and whether alternate work making you a ‘part-time’ appraiser is an option? Considering the educational and continuing education costs compared to say for example, real estate sales agents is interesting, But most sales agents are Realtors and Codes of Ethics insure professionalism, I believe. Business practices that have “overloads” of work would be wise to re-evaluate too. State agencies and appraisal standards advocated through USPAP are really starting to “weed out” the master craftsman and the ‘quick buck’ technicians in our valuation community. (Older craftsman need to pass on to the apprentices, I believe, and a profit in business will ensure this.)

  8. Armando A. Malanga

    Just ask any doctor what HMO’s did to the fees of the medical profession and that’s what AMC’s are doing to appraisers. AMC’s = HMO’s of appraisal.With 32+ years in appraising, the whole situation in housing and appraising is disappointing.

  9. Maryellen, a CT appraiser

    I just received 2 “appraisal opportunities” from an AMC who lowered their fees to $200 for a full appraisal per lender request they said in order to get the contract for their business. For $200 for a single family the requirements are 5 comps for a declining market and the 1004MC addendum. They recently supplied a list of written “Examples of How to Address Issues that Violate Requirements in your Report” that I can only surmise they found necessary to produce for use by the appraisers with limited writing skills too often present in our field. For a 2 family appraisal, the fee offered is $400 for 6 comps as 3 listings are required, an “as is” and “as repaired” value with a list of repairs necessary, the MC addendum and a due date 3 days from today- they want all this for $400. I made counter offers with later due dates and higher fees. I will be very surprised if my counter offers are accepted.

  10. Walt Humphrey

    Cheap-Charlie apraisal reports made by the inexperienced and untrained wouldn’t be so bad if they were reviewed by lenders with competent reviewers and underwriters. All to many times the reviewer-underwriter knows less about appraising than a template with punched holes and simple ratios allow. Then, regardless of how many comp sales you had, they need one or two more as if you were saving the best until last. This is compounded by USPAP interpretations requiring matched pair (though flawed) or stats for every adjustment or absence of adjustments which distracts from analyses of other features The system is headed from broken to failed.

  11. Mike

    Thank you to Kenneth Harney for his article. NY attorney general Cuomo is very short sighted and took a knee jerk reaction in assigning so much responsibility for the real estate industry’s problems to appraisers. Are there unscrupulous appraisers? No doubt. Are there unscrupulous mortgage brokers, lenders and real estate agents? Absolutely. But, I believe they are the minority. Most of us (appraisers) work within the scope of USPAP, and do so with integrity. We take pride in our work product. The HVCC is not the solution to the problems created by the few who are willing to sell their integrity. In my opinion, AMC’s are parasites who are sucking the life blood out of appraisers for a substantial cut of the appraisal fee by acting as a middleman for lenders who have become afraid of the their own shadows. Has the AMC improved the quality of the appraisal report for the lender? I doubt it. AMC’s create an additional layer of pressure on appraisers that is unnecessary, such as fee pressure and delivery times. In my market, the fee for a 1004 is approximately 25-30% less than it was 10 years ago. It certainly does not cost me 25-30% less to produce that report. That fee loss is largely due to fee pressure from AMC’s. And if I refuse to accept the fee from the AMC then mysteriously, I no longer get work from that AMC.
    Does that sound like price fixing to anyone?

  12. One of the most difficult things to explain to a client is the fact you have an appraisal, let’s say for a refinance, it does not mean the property is worth that amount as a full appraisal and what I call a “drive by” are not the same. Not all appraisals are of the same quality and I hate to see good accurate appraisers leave the business. We need you and we need to fix this situation by standing behind you. You cannot provide a good quality product for $200.00. My clients should not be picking up the tab however. The actual appraiser should recieve a larger share of the fees.

  13. When are we appraisers going to stand up and file a class action suit against the people that wrote the HVCC? Look at how much business you are going to lose and how much of your fees will be taken by these AMC’s. Forget the relationships you have built, they mean nothing going forward. We are being put at a disadvantage in a big way and we are all just sitting here letting it happen. Stand up and fight people.

  14. ENRIQUE SANTOS

    The new form of slavery are the AMC. Appraisers thet do not want to be slaves are not afiliated to those companies. Appraiser are considered proffesionals, not hourly employees. Fellows appraisers do not enroll in the MAC companies you deserve best.

  15. Will

    I agree that AMCs make it worst. Especially when the independent mortgage brokers are still out of the loop. By far they are the ones that I have had the most problems with. My largest client is a credit union who I had a great relationship with. They just wanted an accurate appraisal and never bothered me. Now all their orders come through an AMC. My fee is $40 less per appraisal and they have a stop watch on me. Professional or not, I know it’s effecting my quality. It’s just the nature of it.

  16. R. Patrick Goebel

    Appraisers that work as a sub-contractor for an appraisal shop need to remember that they will get all the headaches and administrative requirements that go along with running your own show if they think the fees are more attractive than their current fee splits. The equation is not so simple. I have been an appraiser for 18 years and have experienced all angles. The appraisal shop owner’s have a lot of other responsibilities and overhead than the subs. I think the more the lenders realize that they already have the tools to comply, the less likely they will be to loose control of their appraisal ordering process. This means less attrition to the fee cutting, indifferent AMC’s that are working to undermine our profession. Chins up appraisers, those with experience, integrity and spine will come out just fine.

  17. Bob

    In addition to the new form required in all reports starting April 1st (and by the way what a joke that is) in addition to a management company taking 40-50% of our fees is absolutely unacceptable. The bottom line is you must say “NO” and refuse to work for any management company. If licensed appraisers are unavailable to complete work for AMC’s who exactly is going to value homes in any market if they are not licensed to do so. We must go on strike and not give in to the greed of AMC’s and eventually something has to give. What person in there right mind will go to school for 4 years,pass a state exam,deal with the expense of continuing ed,MLS fees,Insurance,computer costs,vehicle maintenance gas prices and on and on and on for peanuts. Might as well learn the term”paper or plastic Maam” and get a job at your local grocery store,you’ll probably make more money. For Gods sake,band together for once and refuse to do work for the AMC’s, eventually they will go away. If we qualified appraisers stick together and just say “NO” the Lenders will have no choice but to give in.Are industry has no room for “SCABS”,scabs eventually work for AMC’S
    Bob @ Certified

  18. Cory

    A class action law suite is pending in Seattle for Homeowners against Countrywide (Landsafe and B of America) for charging Homeowners full appraisal fees, yet paying a third party – Landsafe- a 3rd of the fee. RESPA and others are following suite. A Homeowner should not pay $400 for an appraisal and get $250 worth of an inferior product.
    Stand your ground. Don’t accept this AMC bulling. They are going to be severly restricted. BB&T has already dropped their services and gone back to assigning on rotation from the Bank at full fees.

  19. Anonymous

    The underlying problem is an oversupply of Appraisers. During the refinance boom in the early 2000′s, Appraisers were in high demand and were able to obtain reasonable fees. Many Appraisers took advantage of the situation by hiring multiple Trainees and keeping a large % of the Trainees assignment fees. After a few years, the Trainees were able to become licensed and are now competing with the experienced Appraisers.
    The recent AMC Appraisal fees may be low for experienced Appraisers, but the recent fees are often an increase for the recently licensed Trainee.
    The fee is also the primary selection criteria used by many of the AMC’s when selecting Appraisers.
    If an Appraiser does not agree to the AMC’s discounted fees or other assignment criteria, the Appraiser is cut and easily replaced by another Appraiser.
    Until the Appraiser supply – demand balance is restored, the Appraisal business will continue to be in a free fall. Many Appraisers (experienced and inexperienced) will be required to leave the profession to restore the balance.
    The long term existence of the Appraiser profession will be determined by the Appraiser’s value. If the competent Appraisers are forced out and the incompetent remain, the Appraisal profess will die over time as the real estate industry confirms the remaining Appraisers are of no value.

  20. I routinely receive emailed invitations to bid on field review orders with the proposed fee of $125! Someone is taking these jobs, I guess at, or near, that fee. I mention it because the Field Reviews are probably part of some lender’s demonstration of “diligence”.If the client were really relying on the review results, they would not put the work out to bid like this.It is an inducement to the desperate to rubberstamp some other cheap piece of work.

  21. Hal

    I did not renew my Certified Residential licence this year. With 46 years in the business and over 30+ years doing appraisals I’d rather go fishing than face long tedious hours and great frustration doing an appraisal… and don’t forget the liability… we appraisers are to blame for all of the industires ills. Bull loney!

  22. Doug

    When I get called from an AMC the only questions are, “What is my fee and what is my turn time?” One AMC makes you have a turn time of 24 hours after inspection and expect you to return any corrections within 4 hours. But they don’t want errors. You know maybe if they would slow things down there wouldn’t be the need for corrections. Everyone is in a hurry! But why? What is really “funny” is that a borrower called me and asked if I was done with the appraisal. I said I turned it in a week ago. He said that his bank hadn’t received it yet! This isn’t the first complaint that I have received from brokers using AMC’s. Indeed one broker said he was so happy he didn’t have to use one big AMC because it when he did it was taking TWO WEEKS to get an appraisal. My turn time is about 7 business days! AMC’s also don’t provide the customer service a direct relatinship with a broker has. For example if I go out to the property and know right away it isn’t going to fly because of repair issues I simply call the lender and stop work. So I charge a trip fee and the broker can then talk to their borrower and hopefully quickly rectify whatever problems there are. An AMC will say just complete it. Now the lender has an appraisal they can’t use and have charged the borrower a full fee. Then they have to fix the problem, send out another appraiser to do it again, and the poor home owner has to pay for two appraisals or the lender eats it. I predict this HVCC will go by way of the dust heap in about 6 months. Brokers will hate it. The process will crawl to a halt. Appraisers will start resisting in mass. And homeowners will be angry that it is taking so long to close their loans.

  23. I have just one word for why AMC’s are bad for the mortgage industry & that is “Countrywide”. Didn’t they just go under because of making bad loans due to properties being overvalued through Landsafe? Do they never learn? Now they want all appraisals to be done like theirs were. Come on!

  24. Tim

    To answer some questions check out the following link to see what is currently happening. One of the largest AMC’s who had Countrywide appraisal business is now facing some legal trouble. Since AMC’s are completely unregulated the only way to expose their operating procedure was for affected homeowners who $400 or more for a “professional” appraisal only to find out that half or less was actually paid to the appraiser. Price fixing, RESPA violations, and ongoing organized fraudulent activity. This is going on in every state every day. Check it out ! (Lets hope they win)
    http://www.hbsslaw.com/homeowners_release

  25. Dave Malosh

    There are a few AMC’s out there that will pay the normal fee. They do push a little but that’s life these days. When you find AMC’s that you can work with let your contacts know who they are so they can sign up. AMC’s will only stay in business if they have clients. Also, remind your contacts (who you will still know, even with all the regulation) when they call shocked by some fly by night appraisal that they need to print it out and send it to the state board that has oversight. When you have calls from home owners who say they were turned down for a loan because of your appraisal, when you know it was fine, and you suspect some funny business at the AMC – give them the 800 numbers for the state board of appraisal and banking. It takes a little time to do the weeding but it gets the garden clean in time.

  26. D. David Thomas

    Ultimately, the issue as I see it, (and also what appears to be overlooked in the responses of fellow professionals, as well as the article), is not primarily fee’s, turn-around times, AMC’s, the HVCC or blame for the market being thrashed, it is the reason Appraisers exist in the first place…..we are here to establish and maintain industry credibility and confidence for the safeguard of the general public’s trust. Without Independent Fee Appraisers there is only the Government to regulate for the best interest of the public at large and I am fairly certain that that is a seriously failing proposition in any economic time, good or bad. AMC’s, AVM’s and large Appraisal Firms are only driven by the end result…….maximizing profit at the expense of the under-trained and under-experienced professionals and especially the public. As an appraiser, I neither ask, nor want anything more than adequate time to provide an accurate professional appraisal that I can defend in court or a Board Review and be paid a fee that allows me the time to do so without working another part time job outside the profession in order to supplement my work ethic. I read many retorts to articles supporting the demise of AMC’s and agree they should go to the wayside but greed by large industry machines and those that simply wish to continue paying their bills will allow them to remain until the public trust is once again damaged and in turn, AGAIN, the public has to demand change by way of downturn in home purchases. Greed can be controlled but not without great sacrifice by those that have the least control. Our country is built on perseverance, (which will likely happen in the appraisal profession), I would just like the price for honesty, integrity and self worth to be of a value greater than the price of a sporting or concert event ticket to watch over-paid and over-pampered performers.

  27. Doug

    The best AMC I work for pays me nearly my full fee. They don’t hound me constantly. They give me time to complete the report. And when corrections are requested they are respectful that I’m the professional in the field. The consquence is that I don’t feel stressed when I get their request, because I can do a good job. But they want quality work as well and even score reports. Not a problem with me. It keeps skippy out of the loop.

  28. Phil Lewis

    First, get rid of real estate agents doing BPO’s as substitutes for appraisals.
    Second, don’t worry about what comes second until you have eliminated THE FIRST AND BIGGEST PROBLEM. If appraisers got all of the appraisal work done by people without appraisal licenses, we would be rich!

  29. Tony Marar

    Dear appraisers as a REALTOR for 14 years I do feel your pain and I hear you very well, our pay cut was accepted just to make a sale of repossessions. We work for peanuts too. $500 mini deals for a 6 month work with lenders who owned the (DUMPS).

  30. Baron Kahle

    This is another reminder that the appraisers in this great country must unify. There has been no effective representation on behalf of the appraisal profession. The so-called established “appraisal organizations” have been found out over the years that they truly represent interests other than those that they purport to represent. Just review their collective track records. Have they ever stepped up to the plate when appraisers rights are at stake? Some organizations were originated by company men (staff appraisers) from the S&Ls with the intention of controlling independent fee appraisers so that they may better serve their masters. Divide and conquer was obtained over the years and now they have created a solid bloc of first-line resistance toward any attempt by appraisers to gain the independent third party position needed in order to produce the true objective appraisal that the American consumer has been denied for the past decade. Until this farce changes there will be no genuine reform in the lending industry, the worst perpetrators continue to receive bail out billions (rewards) and appraisers will continue to be the scape goats as they were for all the other fiascoes in the past.

  31. Bill

    I am not sure what else to add. The comments above pretty much spell it out. I did have an experience I thought you might like to read. I got a request from an AMC, fee was slightly less ($50) than I am used to but not what is mentioned above. Called the borrower to set up appointment time. No return call, e-mailed borrower, no return. Let AMC know that I had not made contact with borrower yet. Finally the borrower contacted me, apologized, said he was really busy at work etc. So I said that we needed to make an appointment, he gave me a time two weeks out, said he was going to be out of town. I said fine. Contacted AMC- she said,”I will put in the report that your non-compliance was caused by the borrower” My non-compliance !!!
    27 years in RE, 60 years old, I just can’t handle the thought of flipping burgers at McD’s.
    I hope this goes quickly, but I am not so sure. Quick and cheap seem to be the catch phrases.

  32. Kala

    I pray that something can be done about robbing the qualified appraiser!!!! If the banks want a service like the AMCs give, then they should have to pay for it and keep their hands out of the appraisers pocket!!!! We are the ones that pay the liability insurance and can be dragged in front of the board for an inferior report and we get less money??? We “HAVE” to do a good job and they want our money?????? I have been screeming for years and work is hard to find without the AMCs. But most appraisers need to feed their kids and pay mortgage payments so we can’t ban together. If “Every” appraiser would not do any work in a orderly fashion, not one appraiser here and one their, for a couple of weeks, we could make this thing go away. The people who wrote this law didn’t know what they were doing and we, the appraisers, need to set them straight. Let them know we are “Mad as “_ell” and we are not going to take it anymore” Stand up and fight appraisers!!!!!!!!!!!!!!!!!

  33. Doug

    The problem with appraisers is that we are fiercely independent. It is kind of like farmers trying to get together and organize. That was tried and it failed. The best thing to do is on a local level get as many appraisers together for meetings to talk about relevant issues. We are going to do that in my area. But we’ll see how many actually show up. I have my doubts.
    One issue is that I’ve had two AMC’s go broke on me that owed me a significant amount of money. AMC’s that don’t pay on time, are difficult to work for, and pay crap can indeed be talked about and put on a list of suspects. With all the AMC’s cropping up we need to be careful about who is ordering, paying for, and sending out these appraisals. There are security issues and payment issues. I have a feeling that most of the work is going to be funnelled to the big AMC’s that have had a long track record. That means it will be easy for AMC’s to control prices, appraiser lists, and ultimately the industry.

  34. JOE

    I like to talk about my personal experience which certainly does not work for everyone but it certainly has worked for me over the past 20 years. I have always been an in-house appraiser working for 2-banks and now an AMC for the past 10 years. I’m certainly motivated and have been earning a decent living for all these years and hopefully I can make it for another 10 years just so I can help put my kids through college. I’m looking forward to the day I can leave this business for good and do something else. However, I work directly for this very large AMC backed by one of the strongest lenders in the nation and I feel very secure as far as job security which is a nice feeling. I have always been a top producer and certainly nobody ever had an issue with the quality of my work. I certainly may have personal issues working 12 hour days but when you work from home, the hours fly by and these 12 hours certainly feel much less. Working as a direct employee of the AMC, I receive a 401k plan and health insurance which is rare for appraisers. In return however I work for about 1/2 the fee they charge to the client. However, in return, I have 1st priorty for receiving the work when the work is slow. I have never been slow in the past 10 years. Since I only do work for one lender, you get to know exactly what they want and getting call back for questions and changes is very minimal. Also, I work in a high density area and can do much more than someone working in a more rural location. I personally would never do this job if I had to travel 100 miles to my 1st appointment and living in Kanas. Now, up until about 2-years ago, the individual mortgage consultant would request the appraiser via the AMC. As we all know, the mortgage rep would ask if we could achieve a certain value. Lender presure–I don’t have to go into that as we all know what a broken record sounds like. However, this has all changed now. The Mortgage reps must order the appraisals thur the AMC directly and cannot request the appraiser and do not even know who the appraiser is until the report is fully completed . I do not deal with the mortgage reps directly anymore except for friendly chats and service related issues. They are not allowed to discuss values. I have no lender presure anymore. It’s been about 2-years now. The senior management at the mortgage company has cracked down on the mortgage reps for appraisal pressure issues that most are afraid to even return an appraiser’s call directly even for simple non value issues. The big guns at the major mortgage companies including the CEOs are the ones who need to manage the lending staff forcefully in cracking down on appraisal presure. It certainly seemed to work in this organization. I’m sorry that many individual guys out there will be effected by the HVCC. I feel for all of them. However, when I 1st started in this business , I always had a strange feeling something like this would happen which is why I never wanted to own by own business. (Well actually I would, but not in this business). I always found it strange that the entire industry was set up to allow for lender presure by allowing mortgage reps to have personal relationships with appraisers. We all know this is the reason why we are in this mess.

  35. Jen

    I just received four residential appraisal orders from an appraisal management company Saturday afternoon; due date of Tues; fees $100-$150 below what I usually charge for the same report, plus the AMC wanted an additional addendum page — the items on the addendum page are those that have been included in my reports for years.
    Small companies doing lender-only work or a large portion of lender work for their business will soon be out of business. If an appraiser is a good appraiser, they are not available to do an appraisal in two days and for a reduced fee, especially with the amount of education, coursework, etc. required by licensing. 25 yrs of work down the drain.

  36. JOHN CHINN

    UNTIL THERE IS A SYSTEM WHERE THE APPRAISER HAS SAY OVER WHAT HE OR SHE CHARGES AND NO ONE IS ALLOWED TO TALK TO THE APPRAISER FOR THE PURPOSE OF INTIMIDATION AND WHEN AN APPRAISAL DOES NOT SUIT IT IS MANADANTORY THAT RATHER THAN ASSAIL THE APPRAISER ANOTHER APPRAISAL IS THE OPTION OF THE LENDER, IN SHORT SUFFICENT TIME TO DO THE JOB, AS SET BY THE APPRAISER, SUFICIENT PAY, AS SET BY THE APPRAISER AND ABSOLUTELY NO INFLUNCE ON THE APPRAISERS’ FINDINGS, THIS CIRCLE OF NONSENSE WILL CONTINUE.
    THE REAL ESTATE INDUSTRY SUFFERS FROM BUREAUCRATS WITH NO KNOWLEDGE, TELLING THE INDUSTRY HOW TO DO THEIR JOB.
    THE FEDERAL GOVERNMENT SET ABOUT GAINING CONTROL OF THE REAL ESTATE INDUSTRY 40 YEARS AGO AND MADE MAJOR STRIDES WHEN THEY BLAMED THE APPRAISER FOR THE S& L DEBACLE. THEN WITH BARNEY FRANK AND COMPANY TELLING LENDERS TO MAKE RIDICULOUS LOANS AND A NEW CRY “IT’S THE APPRAISERS FAULT,” THE DESTRUCTION IS NEARLY COMPLETE.

  37. DJH

    The answer is simple. Create panels for appraisers like VA has and FHA use to have. Fannie Mae, Freddie Mac, HUD and VA should all have appraiser panels The appraisals would be assinged by a rotation program. Then have random reviews by unbias professionals.

  38. David

    Re DJH’s comment above
    You hit the nail on the head DJH. The solution to the problem was extremely easy and has already been tested. It was also a way that the government could have made a little money off of the entire process had they asked appraisers to contribute a few bucks to help with the cost.
    Unfortunately banks and AMCs would have lost billions of dollars if they implimented such a simple program. Remember banks also own some very large AMCs. See where I’m going with this?
    The answer was simple and I personally told the OFHEO and several members of congress this same thing. They chose to ignore it simply because they are heavily influenced by banking and by AMCs.
    If you require proof that HVCC was written by the banks and AMCs look no further. HVCC in it’s current format can easily be tampered with and is ultimately controlled by the largest players. The system that you proposed could not have been tamper proof and money would not have played a role in who is assigned appraisal work.
    Don’t make the mistake of thinking that HVCC was designed on the grounds of fairness. I did before I discovered that it was actually designed around greed.
    If you believe this I hope you’ll pass it along to your U.S. Senators, Representatives, & News Media.

  39. David

    Have you read the new book “How To Become A Millionaire As An Appraiser”?
    It essentially says says start with a net worth of over $5,000,000, accept AMC work exclusivily, and you’re guaranteed to be worth a million dollars within 12 months or less.

  40. There are several states with legislation in the works to address the issues with AMCs. So my advice to everyone is hold on tight and be prepared for the rocky road ahead. Those of us still in the boat when all of these things take place will hopefully have a better workplace in late 2009 or early 2010. Keep posted and if you want a forum about appraisal go to http://www.aboutappraisal.ning.com

  41. David

    What good is state AMC regulation going to do? The first problem is the fact that lenders are being forced to use them. The second problem is their cheap fees. States are not going to engage in price fixing in order to help us out.
    Look at the big picture people. States are looking into regulating AMCs in order to recover tax revenue that they will be losing because 1/2 or more of the appraisers income goes out of state. Duh!
    And you thought they doing this to help you out. If that gives you a warm fuzzy feeling…go on believing it.

  42. Ron

    Well, these comments have been great to read. Since we are in an industry mainly comprised of independent professionals the opportunity to band around an issue and speak in a collective voice is rarely available. As such, we are rarely heard and, even when heard, our complaints are viewed as mere chatter from the fringes of the issue, even though we are the issue.
    In such an environment, where the complainants gain little notice and respect, have no legitimate vehicle, including their own,
    “professional rganizations” to voice their complaints in a forceful manner and are not logitically structured to deliver any substantative change, even though they are the best source for delivery of change, there is very little to be done other than except the condition or refuse it.
    Therefore, after reading these comments, recent experiences with my testing the AMC market and with considerations for the effort, service and adherance to standards that I have applied over the past several years to become a General Appraiser, I have decided that enough is enough. I am not going to accept less than a reasonable full fee for the work, cost and liability I assume each time I accept an appraisal assignment. Just as this has been a great profession and provided a good and respected living, it is not the only profession or line of work that offers such and it appears that it is time to find something else to do. I am not going to take this, especially when I consider allllll of the options that were available to assure Appraiser independence, integrity and a good work product, this HVCC option is definitely the least and most unatttactive anti-small business option that could have ever been devised. The entire conception and evolution of the HVCC decree, is a direct prodigy of the union of political influence and corporate greed and it is being groomed to mature and prosper, on our backs and with our money, so that it can make a direct assault on our right to even exist, let alone compete and prosper. Through all of the corporate accounting scandals at companies such as Enron, MCI and even the Madoff case, I have heard not one provision, that penalized the accounting industry in mass by removing their right to seek clients and business. But we are suppose to not have the same privilege as a profession. Are tax accountants penalized in mass, because of a few bad tax preparers, by requiring that tax payers go through a third party to get a tax return done.
    So again, I am not going to take it, and if it means I have to find something else to do, then so be it. At least I am not going to participate doing so to me would be the equialent of paying someone to put me in slavery.

  43. David

    Although we’ve already decided to close our doors I’m still up for a good fight. I’d like to start a website for appraisers against HVCC. Just a short page that takes survey of appraisers. Such as:
    1) Do you intend to work for free by accepting 1/2 fee orders from AMCs?
    2) Would you be willing to participate in a class action lawsuit regarding HVCC?
    3) Do you intend to close your appraisal business this year because of HVCC or the form 1004MC?
    4) How much do you intend to charge for the 1004MC?
    (I could care less about price fixing charges…I’m being driven out of business already)
    It would be great to have a central location on the web with active surveys showing how other appraisers feel and what they intend to do about it.

  44. scott

    I got a call from RELS, to do work for them. They indicated the fee to be $190 for a single family report and these fees were the going rate set by the appraisers in my area. I told him from my research ( reading postings on this sight), that RELS sets the fee. He said, its similar to doing “fee split” work and that’s how they operate. I told him the only appraisers willing to do that are the appraisers who dont have the experience or who still need to be supervised. This will lead to a poor report, since they wont be supervised. He knew exactly what I was talking about and indicated that they know this is going to be an issue. If we all say NO to these AMC (LIKE I JUST DID), they would eventually get our point and pay our fees. But, there will always be a few that will do the work for AMC for a SMALL fee. If appraisers stopped doing work for AMC for a few weeks, eventually they will pay our fees, you would be able to make up what you lost (during the protest) in the long run. Either $350 or $190, it’s that simple.

  45. Dave

    Either you do appraisals for AMCs, get your own business or split fee from another appraiser. Split fee-the owner of the appraisal company is going to pressure you for a value. Your own business- your going to get pressured from the LO. AMC’s your going to get paid peanuts. What is a honest appraiser to do? All of you that say the Mortgage companies should hire the appraiser, you must have Mad sales skills because your not going to keep a client more than a few weeks. All of you that work for the Appraisers on a split fee basis, you do know they have 10 other appraisers to do the appraisal if you refuse it. And for all of you that put up with the crazy demands of AMCs, good luck with that. I’ve been appraising for 17 years and see that you can’t win in this environment. The new MC for if filled out correctly should take a skilled appraiser over an hour. Does anyone value your time? If your smart you will become a LO for a bank. You will not have to have a license and basically all you are doing is selling the one thing people want most, MONEY.

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