Details of the New AMC Law
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No paid lobbyist, just appraisers talking with the Senators and Delegates about the abuses of some AMCs…
Governor McAuliffe signed SB1573 into law requiring appraisal management companies to pay within 30 days of the initial delivery. This becomes law July 1, 2017.
Here is how it happened….
Two appraisers, both small business owners, sat down and had a conversation with Senator Frank Wagner about some of the issues appraisers are facing. By the end of the conversation, the three were on the phone with a representative of Legislative Services drafting the verbiage of the bills needed to help protect the consumers of Virginia and the appraisal profession.
Senator Wagner introduced two bills, SB1573 and SB1575.
SB 1573 required AMCs to pay within 30 days of the initial delivery of the report. SB 1575 was a little bit confusing, but in a nut shell, this bill prohibited AMCs from including their own fees in calculating customary and reasonable fees paid to appraisers as outlined in presumption 1 of 129E of TILA. This bill, because it went against Federal Regulation, was sent to the Housing Committee for a study and will be readdressed next session.
Several Appraisers spent several days meeting with Senators, Delegates and their assistants, NO paid lobbyist, just appraisers talking with the Senators and Delegates about the abuses of some AMCs and how they are harming citizens of Virginia, local communities and small independent businesses. It really was that simple. This was a personal sacrifice of time and loss business by those appraisers and a huge win for appraisers.
The legislation had the support of VaCAP, ASA, NAIFA, and AGA. All these organizations wrote letters and their members attended the legislative sessions to speak in favor of the legislation and the appraisal profession.
When SB 1573 was introduced in the Senate General Laws Committee, Senator Wagner offered a substitute bill, essentially adding verbiage that the AMC was prohibited from utilizing staff appraisers for the completion of appraisal reports. The appraisal report must be completed by independent contractors. Forty Senators supported appraisers; the bill passed uncontested.
When the bill was introduced into the House of Representative, REVAA had gotten wind of the legislation and they were there in full force opposing SB1573. The substitute language requiring the use of independent contractors was stricken from the bill and the ninety eight Delegates passed the bill uncontested.
Here is where it gets interesting. Because the Senate version and the House of Representatives passed different versions of the Bill, a conference was held to resolve the difference. The conference members consisted of three Senators, Frank Wagner, Jill Vogel and Jeremy McPike, as well as three Delegates, Christopher Peace, Thomas Greason, and David Bulova. The conference passed the House version of the bill. We are not sure what transpired in the conference, but we encourage constituents of these representatives to have a conversation, face to face, and find out what happened. Plans have already been put in place to bring up the use of AMC Field Staff Appraisers for the completion of appraisal reports in the next General Assembly session.
We really would like to thank the AMCs for helping get this legislation passed. When we talked with the Senators, Delegates and their assistants, we learned one of the legislative assistants recently refinanced her home and had a very bad experience with the AMC. She told us, the AMC was gouging and “jacked up” the fee significantly above what the appraiser was actually paid. A Senator refinanced his home and the appraiser was sent from over 60 miles away from across the Chesapeake Bay. On the House side a Delegate knew all too well as he has a friend who is an appraiser. So a big THANK YOU to the AMCs for showing their true colors!
And an even bigger THANK YOU to all the appraisers who took the time to visit, call and email their representatives in support of our profession and public trust. We could not have done this without you! Please continue your efforts.
See the entire legislation here.
Reminder to Appraisers:
VaCAP has learned Clear Capital is reducing the number of independent appraisers on their panel in some areas. Some appraisers are getting a letter similar to this one.
Clear Capital periodically performs an administrative review of its approved vendor panel to gauge the needs of its clients and the overall capacity of its panel. A recent review of panel activity and concentration reveals Clear Capital has sufficient coverage in your market area utilizing well-established, high performing vendors. Consequently, due to the inherent costs and increasing regulatory requirements in maintaining its approved vendor panel, Clear Capital is reducing the number of vendors in this area. Regrettably this letter is to nofity you that Clear Capital is removing you from its approved vendor panel.
Clear Capital would like to take this opportunity to thank you for your partnership and wish you well in your future endeavors.
We want to remind you Virginia Law is clear about when you can be removed from a panel.
§ 54.1-2022. Appraisal management companies
C. No employee, director, officer, or agent of an appraisal management company shall influence or attempt to influence the development, reporting, result, or review of a real estate appraisal through coercion, extortion, collusion, compensation, inducement, intimidation, bribery, or in any other manner, including:
7. Allowing the removal of a real estate appraiser from a list of qualified appraisers used by any entity without prior written notice to the appraiser. The notice shall include written evidence of the appraiser’s illegal conduct, substandard performance, or otherwise improper or unprofessional behavior or any violation of the Uniform Standards of Professional Appraisal Practice or licensing standards for appraisers in the Commonwealth;
If you have received notification you have been removed from their panel and not been informed of any wrong doing as described in line 7 of 54.1-2022, the AMC may be in violation of Virginia Statute. Please file a complaint with the Virginia Real Estate Appraiser Board.