Appraisers Need to Rethink How to Conduct Business

VaCAP Board

VaCAP Board

Coalition of Appraisers in Virginia at Virginia Coalition of Appraiser Professionals
Coalition of individual appraisers working together to unite, promote and protect the collective interests of all appraisal professionals in Virginia; to promote needed changes in laws, rules, regulations, policies and standards affecting all appraisers in Virginia; to observe and report the actions of regulatory, legislative, oversight, and standards-setting entities of the Commonwealth.
VaCAP Board

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AMC Apps Do Nothing But Promote Fast and Cheap Appraisals

AMC apps and text messaging does nothing but promote fast and cheap.

Last week we learned of a lawsuit file by an appraiser against an AMC and its owner. The allegations are his personal and business email accounts were illegally accessed and the investigation lead back to an AMC located in Rockville, Maryland and its owner. (You know who it is, no need to mention any names.) This news angered many appraisers as our personal space, property and livelihoods have been violated.

In case you missed the story, you definitely want to learn about it. There are several good sources that have revealed the details. Here are links to them: Voice of Appraisal with Phil Crawford, Housing Notes by Jonathan Miller and Appraisersblogs.

Technology has changed how we all conduct business. Websites, emails, digital photography, GPS systems, MLS systems, laser measuring devices, smart phones and mobile report completion. Even the way we deliver the completed appraisal report has changed. Don’t get me wrong, the advances we have today are great. However, as with anything in life, there is risk. Are appraisers ignoring risks in our day to day activities?

Some AMC’s send text messages to appraisers for assignment acceptance; others have developed their own apps that are installed on our phones. Many AMCs and portals even charge the appraiser for accepting and uploading the order.

In some industries, the use of apps makes sense; Uber drivers, day laborers, and dating and “hook up” sites require an instant response. An app makes sense for those industries. Appraisers are licensed professionals and provide a professional service. There are no professional industries that operate with fast and cheap mentalities and the appraisal industry should not either. The appraisal is the key component to the largest financial investment of consumers. The appraiser should be properly vetted and the agreement to complete the appraisal assignment should be a mutual decision based on communication, research and knowledge. Fast and cheap is harmful to consumers, neighborhoods and the industry. Communication, research and knowledge are all missing with AMC apps. Why would any professional appraiser subject themselves to be abused by AMC’s in this way? Don’t appraisers get abused enough from others?

Prior to AMC’s becoming popular, appraisers would receive an email or phone call and we actually had time to investigate the property to determine not only if we were competent to complete the assignment, but if we wanted to complete the assignment. This crucial form of communication is a far superior system and actually protects the consumers, lenders and investors. There is significant benefit to the appraiser as well. AMC apps and text messaging does nothing but promote fast and cheap.

The bigger question to ask yourself: Are you giving the AMC a way to access your email, contacts, and photos, etc. through these apps? Even worst, what about banking information? How many appraisers give the AMC their bank account information or credit card information? Did you have a background check performed on each and every employee that works for the AMC? Are they bonded? Did you ask the AMC for references? How is your personal information secured? How much risk are you willing to take? How secure are these AMC apps?

Remember, The AMC needs the appraiser more than the appraiser needs the AMC! It is your business, your data, your privacy. Keep it yours and run your business your way!

VaCAP Board

VaCAP Board

Coalition of individual appraisers working together to unite, promote and protect the collective interests of all appraisal professionals in Virginia; to promote needed changes in laws, rules, regulations, policies and standards affecting all appraisers in Virginia; to observe and report the actions of regulatory, legislative, oversight, and standards-setting entities of the Commonwealth.

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7 Responses

  1. Baggins Baggins says:

    Don’t forget the very important first step to security, utilizing an EIN#.  I’m surprised to find some appraisers still furnish their SS#’s to anyone.  As a small business person claiming 1099 income, using an EIN on your W9 is the proper choice.  You are still a sole proprietor and the EIN simply gives you an alternative to furnishing an SS#.

    https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-number-ein-online

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  2. Ralph says:

    I couldn’t agree more, imagine an accountant or an attorney getting an e-mail blast order, how quick and how fast can you get this done?  Quality be dammed! (I see this 1st hand every day, my father is a real estate attorney and vets every potential client/property every day, to see if it is worth his time and aggravation and how much to charge.

    When I last did AMC work 6 to 7 yrs ago, I always insisted they send me my check snail mail, I would not give them my bank accountant information.  (they always insisted on direct deposit, saying I would get paid faster, but I told them this is safer for me. I still prefer this way now with my clients, since there are too many hacks these days. (even Google with their Google docs which looked like the real thing, got many people this past week)

    As for the e-mail hack by we all know who, just terrible and petty! I’m sure he will get his comeuppance. (just one lawsuit after another for that SHOP!)

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    • Baggins - hold the cellular, extra steak instead Baggins - hold the cellular, extra steak instead says:

      Demanding old fashioned engagement is very protective towards the appraisers personal interests.  No broadcast please.  Paper checks only please.  Full 7 days minimum turn time, add 3 days tat per additional order carried please.  No acceptance or upload charges please.  Inquiring about the distribution companies policies regarding fee raking and sharing is essential.  Or cutting the various forms of middle men out of the picture also helps simplify the process of qualifying better clients.  For all this tech capability of assignment companies and lenders these days, the tech that benefits the appraiser first and foremost is typically absent.  To me, mobile devices still don’t make sense.  I see them as functionally restrictive and I remain mystified why the supposed tech geniuses of the world trade mobile convenience for raw power, lower cost, and uninhibited PC functionality at the desk.  An app is merely another in a long line of simple coded programs and a clever way to monetize what should have been free cross platform sharing in this age of advancing technology.  aka; Moores law.

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  3. The appraiser in the lawsuit may also now be getting retaliatory action from a member of his state’s appraisal board that is ostensibly chaired by a close personal friend of the AMC owner involved in the lawsuit.

    Clearly that state has built in conflict of interest issues as long as that Board Member is serving.

    He owns his own firm which purportedly specializes in pre listing appraisals (tending to be high according to reports), which are then advertised in the mls when the properties are listed for sale “XYZ Appraised at $xxx,xxx” with XYZ being his company.

    Appraise it for less than his firms unsupported values, and risk a complaint being filed which HE IN TURN HANDLES!

    What could possibly go wrong?

    The Governor of Georgia needs to rethink his appointments as well as policies that permit clear conflicts of interest by regulatory Board appointees.

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  4. I keep watching hundreds of appraisers dropping out of this profession each month. It seems that will be a problem at some point. Our office just deletes any email from an AMC requesting an appraisal. You guys/gals can work with this scum clients all you want. Some of us will not! It is going to be interesting to see how all of this works out in the very near future. AMCs cannot continue in business unless YOU (appraiser) earns their money for them.

    Do you feel used?

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  5. Mark says:

    I am in California, and let my Certified Residential License Expire August 2015.

    I had renewed it and let it expire twice before, hoping things would improve.

    I am pretty sure, I will let it go for good at this point. I am almost 50 years old, and see no reason to appraise for such low fees.

    I quit appraising after the Home Valuation Code of Conduct (HVCC) and the mass shift in work to be filtered through an AMC, basically after the financial crisis and the creation of the resulting legislation.

    We saw fees drop from $350-$400 for basic Single Family, to $200 or less, based on the new reverse bidding at the AMC’s. From what I understand, fees are back to as much as $325-350, but still far less than where we were 10 years ago taking into account inflation and increased addendums, electronic reporting, shorter turn times, etc.

    The legal contracts that AMC’s seem to want an appraiser to sign off on, are also too much for me.

    So anyway, I will keep my broker license active until I am an old man, but this nearly worthless appraiser license can go to the scrap heap in August. Sad, since I like to think I used to be one of the good detail oriented appraisers, which doesn’t matter in this day and age of low bid rules.

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