AMC`s who prey on appraisers

[Ossie W Johnson ASA]

Every day I hear of some incompetent AMC cutting the fees to appraisers.
Their claim is that if you do not do it for that low fee, someone else will.

In my opinion if we refuse them at their price, and others do the same, then they will come around.

[Ossie W Johnson ASA]

Well stated

[Brian Davis]

Corey - Whenever I read comments like yours I'm reminded of the Appraiser Tribes group and concepts. We don't HAVE to combat AMC "fee pressure" on a national or even regional basis. We can often do it on a "local" basis! You just need a leader(s) to get things moving. Target those firms that you know are "Volume AMC" shops. If you can get them to agree to sticking to their "regular fee" . . . and can demonstrate that like-minded appraisers in the community will do so as well . . .You'll all make more money! The smaller the community the easier the task should be. Maybe you can leverage existing group (AI, ASA, NAIFA) leaders to initiate such an action on a chapter level? Don't wait for this to spring up on a national level.

[Ossie W Johnson ASA]

"Form fillers " is what I prefer to call the lazy, uncaring, and uninformed individuals who try to hold themselves out as an appraiser.

Maybe these down times will make them go away, because of the low fees, or hopefully they will get sued for incompetence.

Every time I find a bad one, I turn them in to the State Board.

[Tim Ferguson]

Ossie, six months ago, I would have agree with you on the form fillers. After doing appraisals for almost 20 years, I thought I would have to close up last year. But I sat down and instead of saying no to all of the AMC, I looked at which ones offered the best fees, and not just the best fees, but the ones that I could generally work with. Then I look at ways, to cut my over head. I started by looking into Brian paperless office. Took a while, but I am saving money. I went from an inch thick folder to about two pieces of paper in the folder. I went from a case and half of legal paper a month, to not even using a case of paper in six months. I switch my office phone to my cell, moving the number to that. I went from 250.00 a month on the phone to 100.00 a month. I have ended up doing other things, all and all, I cut my overhead about $600.00 a month. I do AMC, I do for Rels and Landsafe. Yes I took a cut in fees, but I had to survive and actually it is not that bad with these two. They are fairly easy to work with, on my part. I guess of the rural nature I am in. If I have to charge more, I let them know and most of the time they agree. But I am not a formfiller, I do the exact same thing now, that I did when I started out. I still do courthouse work, internet makes it easier now. You can take a cut in fees and still have work. Keep in mind, I have negotiated everyone of my fees with these two AMC. Their orginial fees was less than half what I charge. But, after talking to them and going back and forth, I am ok what I agree on. Also, do not agree on everything they offer. For example, I have not agree to do FHA with one of the AMC, when I get an FHA, I charge full price. I let them know I did not agree to do FHA and if they want me to do it, it is my fee. Believe me it works.

[Ossie W Johnson ASA]

Thank you for your comments.

I work in far Northern Wisconsin which is a rural area with 2,000 lakes and heavily forested areas. Most often I get MY price, simply because comps are few and far between.
The reports also require more than average comments and addendums, simply because my clients are outside the area. Thats OK, but I will not cut my fees.

I am considering employing some of your thoughts.

[Daniel Wagaman]

Brian Davis hit the nail on the head! We need to unite. Wher the heck is William Wallace or Sitting Bull when we need them? LOL..

[Diana (Idaho) CRA]

Take a look at RELS....they've come up with a new way to get around appraisals. They sent out an email to all appraisers in Idaho who do business requiring Comp checks prior to an appraisal. There are several layers but the one that is upsetting is they will lpay $45 for a comp check to see if it's worth ordering an appraisal. Which if they do decide to order the appraisal they will then deduct the $45 from your fee even though the appraiser will have to do all the research again (2 assignments). Some in our office are against it and some are for it. If we don't do the comp check, of course there is the risk of not getting appraisals. The reason behind this is to cut down costs to the consumer since many home values are up-side-down in today's market so a refinance would be out of the question if the more expensive appraisal report comes back too low. Can you imagine the ethical, legal, and possible fraud that will come from this. What makes anyone think appraisers would not give RELS a higher range value let a lone a lender would make the loan on inadequate data and analysis? Don't forget you sign this puppy as well......Guess What???? It's an appraisal (USPAP) with huge liabilities and they think appraisers can do it in 30 to 45 minutes. RELS also stated in the email they are just one of the AMCs that will be doing this in the future. Appraisers better unite and set our own fees instead of allowing AMCs to take a bite out of our ability to make a living.

[Tom Molinari]

Wow!

RELs appears to be looking for a legal way to get value bids before assigning the order to an appraiser. Where are you now Mr. Cuomo?

[Ossie W Johnson ASA]

Comp checks are not appropriate under USPAP.

By giving a range of value or a point estimate, that by definition is an appraisal and must conform to USPAP.

Giving this free - loading client information can be accomplished by giving him / her a list of sales in an area, but do not comment on which ones are better or which ones are worse, for at that point you have begun the appraisal process.

Ossie

[Diana (Idaho) CRA]

According to our local MLS, giving a list of sales may be in violation of their contract with appraisers. RELs will provide a form on their web site to fill out. An appraiser in our office believes there would be no future arbitration regarding this activity. I beg to differ. It's an appraisal no matter what the fee.

[Tom Molinari]

I'm not sure that people know (even the loan originators and underwriters) how much the LSIs or RELsof the world are taking from the appraisers for processing appraisal orders. Most assume that the appraiser is being paid the full market appraisal fee for the area, or close to it. Yes, AMCs deserve to be able to make money but it should be in the form of a fair processing fee for services rendered and not a major cut of the appraiser's market fees for the area.

Now if the borrower or originating lender wants the cheapest, least experienced appraiser available to do their appraisal then I'm sure that they expect to pay a cut rate price. If I had to guess, the borrowers and lenders are being charged the full market fee with LSI pocketing the balance. If the end users knew the truth that they woud be as outraged about this situation as everyone is about AIG today. Isn't LSI a division of FNC? Aren't these the same fine people that brought AppraisalPort to us? People react in disbelief when I mention to them that appraisers are being charged $10 to upload files when it can be done essentially free. Who siced FNC on the appraisal world anyway? Why do they play appraisers to be suckers?

[Hank Brandon]

Tom,
I understand your outrage, however to take it out on AppraisalPort for charging $10/order is a little overboard. Tell me an AMC that charges less for their service. I have gone through a number of AMC's and have quit a lot of them, at the expense to my pocketbook I might add, because I felt that I gave them a premium product and received a low grade fee. Just lately I dropped eAppriaseIT due to their riduculous fees. As far as AppraisalPort I have picked up a number of good clients that have paid full or close to full fee. After all, AppriaslPort has to charge something for their service. $10 is more than fair especially considering that they have found the client and developed the softwware to allow you to integrate with the client. The client likes it too since it takes them another step away form the appraiser.