AQB Proposes Alternative to College Degree Requirement
In a long-awaited and highly anticipated announcement, the Appraisers Qualifications Board (AQB) has just released an Exposure Draft (May 18) that indicates it intends to walk back the bachelor’s degree requirement for Certified Residential appraisers and more. The AQB also is proposing significant changes to appraiser experience requirements.
An AQB Exposure Draft is issued in anticipation of implementing changes to the Real Property Appraiser Qualification Criteria (Criteria), which is the set of education, experience, and examination requirements for appraisers to achieve a state license or certification. The AQB always sets a comment deadline and is committed to reading and considering all comments before making any changes to the Criteria. See below on how to submit your comments to the AQB.
The AQB’s controversial bachelor’s degree requirement, which took effect on January 1, 2015, has been hotly debated by appraisers and stakeholders on both sides of the issue. Many appraisers complain of being unable to advance in the profession with no time, opportunity or resources to return to school and earn a four year degree. On the other hand, many appraisers argue the college requirement encourages professionalism.
Degree Alternatives
The AQB is proposing two alternative tracks that will allow Licensed Residential appraisers to earn a Certified Residential license without a college degree.
According to the AQB, it wants to create a “consistent, measurable method” that will ensure Certified Residential candidates have acquired analytical, mathematical, and written communication skills. The first alternative to a four-year degree is for an appraiser to pass a series of College-Level Examination Program (CLEP) exams. The specific subject areas to be covered in the CLEP exams include: (1) College Algebra, (2) College Composition, (3) Principles of Macroeconomics, (4) Principles of Microeconomics, and (5) Introductory Business Law.
The second alternative to a four-year degree is for an appraiser to pass a handful of relevant college-level courses from an accredited college, junior college, community college, or university. This would involve the completion of 15 semester hours of higher education to include the following courses:
- English Composition (3 semester hours)
- Economics or Finance (6 semester hours)
- Algebra, Geometry, or higher mathematics (3 semester hours)
- Business or Real Estate Law (3 semester hours)
No College for Licensed Residential
Included in the AQB’s proposal is the complete elimination of the 30-semester hour requirement for Licensed Residential appraisers. Under the proposed changes, Licensed Residential appraisers will no longer need any semester hours from an accredited college or university. In terms of college level courses, only 15 semester hours will be needed for an appraiser to advance to Certified Residential.
These alternatives would essentially roll back the majority of the current education requirements, significantly reducing the amount of higher education required to be both a Licensed Residential or Certified Residential appraiser.
In its exposure draft, the AQB indicates that these proposals are in response to concerns that the bachelor’s degree requirement for Certified Residential “creates an unnecessary hurdle for many otherwise highly qualified and experienced” appraisers and discourages “motivated and skilled individuals who would like to enter the appraisal profession, but find they are not well-suited to the traditional collegiate experience.”
Experience Requirements
In addition to proposing sweeping changes to the education requirements, the AQB is also proposing significant changes to appraiser experience requirements.
The AQB acknowledges that experience requirements for all levels of appraiser credentials need some adjustment. Based on the feedback it received, the AQB writes that there is “strong support and rationale” for revising the experience requirements because of the many obstacles currently facing the old appraiser-trainee model. As the rationale behind its proposals, the AQB cites trainees being unable to “locate a supervisor or losing their supervisor during the training period,” and the fact that potential supervisors are unwilling to take on trainees for a variety of reasons, including “increased liability, a requirement by many users of appraisal services that the supervisor accompany the trainee on all inspections, the refusal of many users to accept reports signed by trainees, and a lack of economic viability due to lower appraisal fees.”
In response, the AQB is proposing (1) accepting coursework in lieu of experience for Certified Residential and Certified General credentials (not for Trainees), (2) shortening the timeframe requirements for earning the experience for all license levels, (3) changing the number of hours required for experience for all license levels, (4) allowing for the substitution of experience from other real estate professions.
First, the AQB is proposing the development of practicum coursework that could account for up to 100% of the experience requirements needed to earn a Certified Residential and Certified General credentials. For clarification purposes, the AQB is relabeling the practicum coursework concept as Practical Applications of Real Estate Appraisal, which would include classes utilizing case studies as a means of providing practical experience.
Appraisers would be able to use Practical Applications of Real Estate Appraisal courses to meet the experience requirements needed to become Certified Residential and Certified General.
There are no proposed changes for Trainees. Despite acknowledging that “opportunities for appraisal training have significantly diminished” and that “many experienced appraisers are reluctant to train because of the costs incurred and the lack of future monetary return,” the AQB indicates that it does not intend to allow Practical Applications of Real Estate Appraisal courses to substitute for a trainee’s experience requirements, meaning that a trainee would still need to complete all of his or her hours to achieve the Licensed Residential credential.
When contacted for comment, John Brenan, Director at TAF, confirmed that trainees would not be able to use these practicum courses towards the experience required for the Licensed Residential classification. However, Brenan left the possibility open, indicating that the goal of the exposure draft process is to solicit feedback.
“It’s possible the AQB may receive feedback suggesting the Licensed Residential classification be included as well. If so, the AQB may revise the proposal in subsequent exposure drafts,” Brenan says.
Other Changes to Experience Requirements
The AQB is considering these changes to the experience requirements as well.
Option 1 would allow appraisers to earn their hours in a shorter time frame. Currently, trainees must complete 2,000 hours to become a Licensed Residential appraiser but in no fewer than 12 months. The 2,500 hours for a Certified Residential appraiser must be obtained in no fewer than 24 months, and the 3,000 hours for a Certified General appraiser must be obtained in no fewer than 30 months. The AQB is proposing that the candidates for advancement can complete these same hour requirements without any restriction on how quickly or efficiently it can be done. For example, a trainee would be able to complete 2,000 hours in less than 12 months.
Option 2 would reduce the hours of experience required. Under this option, a trainee would only need 1,500 hours to become a Licensed Residential appraiser, the experience for a Certified Residential appraiser would be reduced to 1,750 hours, and the experience for a Certified General appraiser would be reduced to 2,000 hours.
Option 3 would permit experience from other professions could be considered for a portion of the overall experience required for licensure or certification. This experience could account for up to 50 percent of the overall experience required for the credential.
As part of Option 3, the AQB outlines several professions with skill sets that could be considered as alternative experience, including (1) Property Inspections, (2) Area Descriptions, (3) Real Estate Agent/Broker Experience, (4) Financial Analysis, and (5) Participation in the Appraisal Process. The AQB writes that it did not include real estate assessors within this concept because their “mass appraisal” experience already qualifies as experience under current Criteria rules.
By allowing experience from other professions, the AQB is potentially opening up the appraisal profession to professionals with experience in home inspecting, real estate sales and brokering and other real estate related professions.
The AQB proposes the following matrix that indicates allowable credit for up to 50% of a trainee’s experience requirements:
This table seems to indicate that a real estate agent/broker, for instance, can defer 3% of the trainee experience requirement for every year they’ve been an agent or broker, up to a maximum of 15% of the total. These categories can be combined but cannot exceed 50% of the trainee’s total experience requirement.
More on Trainees
The AQB is also proposing the removal of the three-year supervisory jurisdictional rule that requires an appraiser to be in good standing within a particular state before taking on a trainee. This change will not remove the requirement that an appraiser be in good standing for at least three years, but simply removes the requirement that the appraiser be licensed and in good standing within a particular state or jurisdiction for three years prior to hiring a trainee in that jurisdiction.
Lastly, the AQB writes that it has considered requests by some stakeholders to change the Trainee label due to a perceived lack of public trust that may be attached to the word. While noting the concerns, the AQB is declining to suggest any changes to the trainee label. However the AQB notes that “because of the misunderstandings by some that the Criteria prohibits Trainees from performing inspections without a supervisor or from signing an appraisal report, the AQB intends to issue guidance (in the form of one or more Q&As) that will distinguish the requirements in the Criteria from those in the marketplace.”
To read the AQB’s Exposure Draft in its entirety, click here.
Send Your Feedback!
Appraisers are encouraged to submit their (concise, considered and spell-checked) comments to the AQB before the June 17, 2016 deadline: Email: aqbcomments@appraisalfoundation.org or mail to: Appraiser Qualifications Board, The Appraisal Foundation, 1155 15th Street, NW, Suite 1111, Washington, DC 20005.
Future of Appraisers Survey
In addition to sending the AQB your feedback regarding these particular proposals, you can also take Working RE’s Future of Appraisers Survey. Share your opinion on the college degree requirement, trainee experience requirements, and more with Working RE’s Future of Appraisers Survey.
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- AQB Proposes Alternative to College Degree Requirement - May 19, 2016
Most residential appraisers I know already had their college degree when they got into appraising, which was a career change.
You want to get more people into the field? Pass a law stating the AMC can only charge the bank $100/appraisal. The rest of the fee goes to the appraiser.
If that puts them out of business, so be it. Let the banks hire reviewers.
They simply don’t have the intelligence to realize why people are running for the exits and why fresh meat won’t touch the “profession” with a 1,000 meter pole.
HINT # 1,000,000,000,000,0000: “IT’S THE FEES YOU IDIOTS”
Get rid of the AMC’s and the appraisers will come back
1. no, we need less appraisers.
2 $100? why so much for transmitting 1 piece of paper. let the lenders go back to doing it themselves like before.
Personally I think they’re jumping the gun on this one. We really haven’t even felt the effects of the new regulations simply due to market conditions, and they’re already looking to change the regulations.
This is was, and continues to be, that certain market segments do not pay a fee commensurate with the work required. The degree requirement actually goes a long way towards correcting that, because college grads aren’t going to work for peanuts when they have other career options. The effect of that is that fees go up. Appraisers should actually be fighting these new regulations, because if they don’t, there upward market pressure to increase fees will be removed.
you think they are “jumping the gun”? you cant be serious?
are you not aware of all the damage that incompetence and over-regulation has done over the last few years? are you not aware of all the appraisers that have already, and continue to give every day, the banks, AMC’s, states and fed the middle finger as they exit the profession in disgust for the last time? have you not paid attention to the statistics? have you not paid attention to the results of the polls on places like Appraisalport? are you not aware of all thats really going on in the profession these days?
curious – did you really post this comment on 05/19, or was this copy and pasted from 1998?
question – are you currently a member of the AQB by chance?
the bleeding continues . . . . .
I’m confused by your comment. I’m saying that they should not get rid of the college degree requirement, then you give a bunch of reasons supporting my position.
People leaving the profession simply means a lesser supply of appraisers for those remaining. The college degree requirement limits the inflow of appraisers into the business. The result? Higher demand and higher fees. Why is that such a bad thing?
Keep in mind some of the polls are heavily biased in favor of residential appraisers. Those that examine the entire industry show a different picture. And that is important, especially going forward. The 4-year requirement for CRs will likely cause more appraisers to get their CGs. Once again, that results in significant upward pressure on fees.
I have my college degree, and I don’t work for AMCs. If I had to, my college degree is marketable, and I would weigh other career options against the lowball AMC fees and incessant harassment. If I didn’t have a degree, I wouldn’t have a choice.
And no, I am not an AQB member. I suggest not making such wild assertions with people you don’t know; it demonstrates a conspiracy mindset and agenda.
Dave, these issues are specifically coming to light in places like Colorado. They’re even talking about regulating the appraisal fee as a result of complaints regarding appraiser fee gouging here in Colorado. OMG, this gets better and better and you can’t make this up. The principals of substitution are levied readily to drive appraisal fees down and stagnate the fee. But when the distributors have to pay the overtime rate and the penalty rate for having both time draining and unreliable order distribution and underwriting practice, suddenly the appraiser is fee gouging. I have one distributor whom on one hand told me straight up he would not assign to me any more because of an MB complaint on turn time. So after chilling me for a month or two an order comes directly. Guess what, typical 100 upcharge to $550 for being the overtime slot. (That’s friendly because it was direct. I’m quoting double overtime quotes in the $700+.) Then I get some note about future regulation to protect customers from fee gouging. I’m quite sure that when I work 70 to 90 hour weeks, overtime rates are applicable and valid. It’s either a free market or it’s not, these guys want the cake, and to eat it too. “The cake, is a lie.”
While you can quote $550 to $700 for an appraisal in CO, CA appraisers (San Diego) get turned down asking for $300 and ($50 complexity) for those Pacific Ocean influenced properties over 1.5 million. If your turn time is over 3 days, forget about getting the order at any price. As it relates to appraisal volume, your area may represent that one in ten problem (high fees), while the 9 out of 10 areas (mine) get ignored. The fix (lowering standards) address the 10% areas (lower fees) while only accelerating the demise of the 90% areas like mine (even lower fees).
What shortgage? We step on each other in Florida. Problem is the AMC’s are so greedy, they shop until they drop to make the biggest profit on each deal. Get rid of the Appraisal Mills(AMC’S) and appraisers will accept work again.
Talk about EATING CROW! I fear that crows may go extinct after the amount that AQB was forced to swallow.
They should consider changing their acronym from AQB to RDA (Royal Dumb A**ES)
Brett Ryan Modeer
This will accomplish nothing, what person in their right mind would go through all that for a $300 to $400 fee
This is too little too late. Many of the older appraiser’s were simply grand fathered into licensing when it was imposed in 1993. Now that many of them are retiring, no one in their right mind would go through all this hell to obtain a license. I would like to upgrade to Certified General, but I don’t see any way to obtain the 3,000 hrs required in the field in addition to another 100 classroom hours, when I’m swamped with residential work and running my own shop. Much better to just just get a sales/broker’s license where you can start making $$ right away.
I think your idea of moving into brokerage is right on track Ralph. The great thing about brokerage is that you are pretty much guaranteed automatic pay raises each year since your commissions are tied directly to the appreciation of real estate in general.
The trainee/mentor ship system is so screwed up! I’m not taking on any trainees as it just slows me down and takes up time and costs me $$ why would a CG want to take me on and train me to then I leave in a few yrs. It could take 5+ years just to reach that level and medical school is only 4 yrs! In 5 yrs there will be very few of us left, my state is already down 60% of appraisers since 2007. (I hear others such as Illinois/CA/Florida have too many appraiser’s but it’s just a matter of time before AVM’s are used to assess risk along w/the strength of the borrower, income, assets etc. with a full appraisal only needed on complex high end properties and maybe Govt stuff, VA/FHA/USDA.
Been saying this all along. Why put in the effort/cost to upgrade when it’s not going to give me more MONEY!
As a CA appraiser you got that right Ralph. There are over 1,000 licensed appraisers in my primary county (San Diego) and 5,000 within a few hundred. Dustin Harris the coach has 30 in his direct county and less than 1,000 appraisers in the entire state.
Lets take a close look at this. The AQB is as worthless as teats on a boar hog! Fannie Mae creates the appraisal forms that most of us use for mortgage lending. Really…should not the AQB be creating and dictating the required appraisal forms? Fannie Mae is an organization that is in receivership with the US Government. They suck a watermelon thru a garden hose. I have stock in this pitiful corporation and would love to see them go out of business completely…I will take the loss! They keep coming up with all of this CRAP for the appraiser to do…1004 MC…no extra fee to the appraiser…then the UAD crap…again…no additional fee.
Now the AQB….must gut the requirements to become an appraiser because some damn AMC or national appraisal company cannot find enough chumps to work for peanuts so that these companies can make millions. REALLY…the members of the AQB should resign and hide their heads in the sand…they are not representing me…they are pitiful!
Just curious…who are the current members of the AQB…Who are these highly intelligent folks that want to sell us down the river to the AMCs and national appraisal companies? Why would they do this…is there some fees headed their way? Parasites in the appraisal profession come from many sources…AMCs, National Appraisal Companies…Some folks jerk our chain by being a silly appraiser coach…others want to sell us worthless newsletters…or get us to travel for a silly EXPO where we can hear nitwits tell us how to do something that they have never done! Some of us are really a very pitiful group of people…I sure wish more of us would get a grip! LOL
Can we have it both ways? Do we REALLY want an appraiser to attempt to preform all of the crap required by USPAP and FNMA or just drive by, take a photo and toot the horn? Just finished reading NINE pages of one to four family sales contract. An addendum for Sale of other property by buyer, Third Party Financing Addendum, Addendum to Purchase Agreement (four pages), Reviewed the survey for encroachments, pipelines (pumping oil well unit next door). Of course there is a Homeowners Association with all of their pages of covenants, restrictions, info about meetings and elections of HOA officers, etc. The city has this property zoned SF-8….Now keep in mind that this is not SF 1, 2, 3, 4,5, 6, 7, etc…It is SF-8. What the hell can you build there?
The builder had to get cute. A bonus room above the garage, a sprinkler system, a security system, a french drain system, Pergola paving, exterior gas fireplace at the rear of the covered patio, and of course there is an oil well with a pumping unit located on the adjoining lot and pipelines, oil/gas storage facilities on each block.
Now, let’s measure that damn thing and find sales and listings! Let’s take a photo of every toilet…Let’s do an 1004 MC, how about a cost approach, highest and best use analysis, on and on and on? Really…those that want us to work CHEAP and FAST…..have NEVER done the appraisal business as a career…They are in a dream world! (THEY do not care as long as they can earn their fortune off of your efforts) Grab your preferred parasite and support them! LOL
You can find the full size of the “AMCEAGLE.jpg” picture here:
“Let’s see if the next appraiser comes in under value. Appraisal management. Keeping appraisers independent since…” It’s a vital photo which all practicing appraisers should have in their free picture folder.
I have been a major advocate of eliminating the college degree requirement. It should never have been imposed in the first place. I’ve authored letters on behalf of the American Guild of Appraisers encouraging elimination of the college degree requirement. What follow are my personal views.
For those that have followed this issue or read the “suggestions” of the national hybrid AMC-appraisal factories, the AQB appears to have jumped on their bandwagon completely. They are 180 degrees out of whack! It is NOT the experience requirement that should be lowered. ONE YEAR to go from licensed to certified? Seriously? No ONE has sufficient experience in only one year to go from a licensed appraiser to certified appraiser after only one year experience. NO ONE! Especially one trained by the national appraisal factory/AMC models!
The AQB is also (by their proposed actions) admitting that ALL real estate appraisal testing in all states across America, is a complete waste of time! IF CLEP is the measure of qualification rather than specific appraisal testing then why bother with it? Either the state tests adequately measure a perspective appraisers ability, or they do not. If they don’t then FIX THAT PROBLEM!
I’ll develop a more thoroughly reasoned response over the next few days, but right now my reaction is best described by a single word:
ASSININE!
Further, it is clearly LONG PAST TIME to replace any TAF members or Board members that have served cumulatively for more than ten years. Its time for fresh ideas rather than modifications of bad ideas that should never have seen the light of day in the first place!
AQB is mostly irrelevant.