Changes for Illinois AMCs and Appraisers
One hundred eighty days flew by in an instant. When the AMC Administrative Rules were launched on March 4, 2013 we were in the infancy of AMC registration. Here we are, six months later and we’re nearing 140 registrants. That’s more than 20 per month. I expect by year’s end we’ll have 180 registrants or more.
This is an important newsletter issue to keep. There are a lot of burning questions that need to be answered in one place so that everyone understands what is expected.
What Happens Next?
August 30, 2013 is the last day in which existing AMCs who plan to operate in Illinois, must be registered.
Is there a grace period? The 180 days between March 4, 2013 and August 30, 2013 was the grace period.
We’re a brand new AMC and our entity isn’t ready to launch. Will we be in violation if we register after August 30, 2013?
No. This deadline is for known and existing entities with a current book of business in Illinois. New entities that are just forming will be able to register when they’re ready. However, no entity can continue their book of business in Illinois without registration once August 31st arrives.
If an AMC tells an appraiser that their Illinois application is pending, can that appraiser complete an assignment for them?
No. Pending applications are NOT lawful registrations. Illinois appraisers may not complete any assignments without the AMC’s Illinois registration number and expiration date.
How do I know what an AMC registration number looks like?
All AMCs have a prefix of “558”.
When do the registrations expire?
They all expire on December 31, 2014.
When should registered AMCs start complying with the Act & Rules?
AMCs already registered in Illinois should be complying with the Registration Act and Administrative Rules upon issue of their registration.
Will IDFPR post a list of entities exempt from registration?
No. As an appraiser you must be crystal clear on your relationship with the client that engages you.
How can an Illinois appraiser complain about an AMC?
The complaint form is already on our website:
How can an AMC complain about an appraiser?
The complaint form for appraisers hasn’t changed and AMCs have already submitted them in the past.
If an AMC sends me an order on August 30th but hasn’t completed the application process…may an appraiser make the appointment for early September and complete the assignment?
So long as the assignment was received before August 31, appraisers are free to complete pipeline orders already in process.
What if an unregistered AMC sends mean assignment for a final inspection or a Catastrophic Disaster Area Property Inspection Report? Those aren’t really appraisals. May I complete them?
No. The AMC Registration Act and Rules cover all appraisal assignment results.
We’re an appraisal company that never intends to act like an AMC. However, due to our ownership, we must register. What are our responsibilities under Illinois’ registration?
Because the overlay between AMCs and appraisal firms is largely indistinguishable, an ownership requirement was established to avoid double licensing of appraisers. However, this still left some appraisal firms with a registration requirement based upon how they were held in ownership. Those firms need to submit the application, pay the $2,500 fee and obtain the $25,000 surety bond. Aside from that there are no other reporting requirements, additional education offerings to take or forced reviews to be performed. Even the certifications at the end of the AMC application are all things appraisal firms typically do in the normal course of business.
Our company is registered as an AMC but acts as both an AMC and an appraisal firm for different intended users. How do we know when we’re acting as an AMC and not an appraisal firm?
AMCs have written master service agreements between themselves and their end-user clients. Each agreement should be clear as to how the entity is being engaged. In some cases the master service agreement identifies the engaged entity as an agent. In others, they are identified as independent conractors. A registered AMC may be acting as an independent contractor for one client but as an agent for another. Appraisers performing appraisal assignments on behalf of the entity must be absolutely clear as to which hat the client (AMC or appraisal firm) is wearing when the assignment is received.
When should I expect my fee from an AMC?
Unlike many states, Illinois does not have a 30, 45, or 60 day deadline by which appraisers must receive compensation from an AMC. However, the AMC must be definitive at the front end as to when and how payment will be received. If an AMC agrees to pay appraisers every week; they need to adhere to that self-imposed schedule. If their written policy is to pay once every quarter; appraisers who agree to that schedule cannot complain before that time lapses. AMCs must have available and keep written policies regarding compensation. These policies cannot be changed on a whim or simply when cash flow problems arise. AMCs are free to choose a payment policy that works best for them but they must stick to it.
As an appraiser, what is the language that I must use to disclose my fee in each report completed for an AMC? An independent appraiser by employment or contract for a specific assignment, the appraiser shall prominently display the appraisal fee received from the appraisal management company in the certificationas follows:
“The compensation for this appraisal assignment is $_____. “
Or An employee appraiser for a specific assignment, the appraiser shall prominently display the appraisal fee received from the appraisal management company in the certification as follows:
“The compensation for this appraisal assignment is $_____.”
Or An employee appraiser who receives a salary and does not receive a fee for the assignment, the employee appraiser shall prominently display the following language:
“The appraiser is a salaried employee and received no appraisal fee for the assignment.”
Where and how do I place the AMC’s registration number and expiration date?
While the Certification is the preferred location, placement can be in an addendum or someplace else in the body of the report. Don’t bury it.
From the Administrative Rules:
An appraiser for a specific assignment, the appraiser shall prominently display the appraisal management company?s Illinois registration number and expiration date as follows:
“The appraisal management company?s Illinois registration number is ________ and it expires on (month/day/year).”
By Lee Lansford – Illinois Appraiser Newsletters – Volume 7, Issue 2