AMC Abuses? What’s Your Story?
Many of you have filed formal complaints against AMC abuses with State appraisal boards…
The place was a small subdivision developed with coastal style homes on the Ocean side of route 12 in the Outer Banks of North Carolina. The bank was Bank of America. The AMC was LandSafe and the time was just before Corelogic purchase of Landsafe for $122 million.
I was asked by this AMC to appraise a home for a purchase transaction. My comparable sales consisted of one recent sale of the next door neighbor, one on the same street, and two closed sales in the adjacent subdivision. I was also required to go beyond what was required by the GSEs and grid two listings in my report. My listings were taken directly from the subject’s immediate subdivision as well. After adding all of this data to the grid and making minimal adjustments for differences in GLA, carports, and bath count, I found my reconciled value to be below the contract price. The contract price was outside the unadjusted and adjusted value range of the comps and was also above the unadjusted and adjusted asking price of the active listings I was required to include.
In short, I came in approximately $30,000 below contract price.
I submitted my report and heard nothing more about it until a few months later when I received a certified letter in the mail indicating a complaint was filed against me at the NC appraisal board. The agent stated I had acted in a reckless manner by not justifying this inflated sale price. She also included emails between her and the bank’s loan officer. The loan officer was urging her to file a complaint against me. He stated that they had asked me for a reconsideration of value and I ignored them.
This was a lie. No new comparables to consider were provided by Landsafe. I never received a request to reconsider the opinion of value from the bank, agent, or LandSafe. If I did, I still would not have been able to increase the value because my data was that good.
I successfully defended my report with the board. I mean you couldn’t argue with the data I had. It was right there!
I found out later, when searching for comps for another report, that the house I valued below contract price closed at the contract price despite the fact that I appraised it $30K less. I later found out, from a real estate agent that worked at the same brokerage as the buyer’s agent, that LandSafe had another appraisal completed on the house. The new appraiser could not have used the comps in the subdivision to support the contract price. He obviously ignored them and went outside the immediate subdivision which was not necessary. Needless to say, I stopped doing work for LandSafe.
Fast forward to today, 8 years later, the property located across the street just sold last month (January 2018) for $45,000 less than what the subject sold for even though it’s superior in Gross Living Area, view, bedroom & bathroom count.
As you know, appraisers are tasked with compiling data that will eventually lead them to an opinion of value conclusion. In this instance, I am compiling data of AMC abuses which I will submit to a prominent news reporter. Please comment below with any stories that you may have, detailing specific incidences that you have encountered within the past 10 years that you feel were inappropriate from appraisal management companies. The greater detail the better; however, let’s keep it brief enough to, as Sonny Boy Williams ll would say, “Bring it on home.” Great song by the way!
Your identity will remain anonymous. You do not need to use your real name when commenting.
Have you been blacklisted, threatened, treated disrespectfully in anyway? Please provide specific details if you have any knowledge of appraisal management companies ordering multiple appraisals on one property to make the deal work; if they pressured you to use inappropriate comparable sales, or if you got multiple revision requests which seemed more like harassment. Please name the appraisal management company you had an issue with.
Once a large enough sample of AMC abuses is collected, it will be submitted to the reporter.
Many of you have filed formal complaints against AMC abuses with State appraisal boards. What was the final disposition of those cases? Were these complaints dismissed or did the boards act against the AMC as mandated by Dodd-Frank? Please specify which State appraisal board handled the case. If you are a present or past AMC employee, who have been subjected to AMC abuses, or have witnessed first hand abuse, I urge you to share your story.
Appraisal boards don’t regulate AMC’s, AMC’s regulate appraisal boards, or else !!
I had an AMC tel me to take out those “time adjustments.” I told the AMC that that was my call not their call. I stopped getting work from them after that.
All AMC’s should be branded and exiled immediately and sent to the goulag.
In the story outlined, (1) I’d file a lawsuit against the Bank for any costs of fighting to protect your reputation and license. (2) I would file a complaint against the agents involved with the State Department of RE. (3)This may be trickier but I’d file a complaint against the AMC AND THEIR current purchaser/owner.
If CoreLogic is not careful they may find themselves subject to a lot more lawsuit sand class action suits.
I hope you contacted the lenders federal regulator and filed violation of Dodd Frank complaint as well.
I have a mortgage company that needs me to complete appraisals for them and wanted me to sign up with Clear Capital. Clear Capital sent me an app to fill out and then said they were not looking to hire anymore appraisers in our area and then turned around and asked the mortgage company to give them several names of appraisers in the area to get them on the list. I am now getting those orders through appraisal port. Ofcourse I had a fallen out with Clear Capital years ago and ended our relationship after a very short time but this is an example of how AMC’s are controlling or attempting to control markets.
Quality Valuation Services back in 2012 landed a contract with 5th 3rd Bank. For $300 they expected a 5 day turn time, aerial map, list date, contract date, listing history and DOM on all comps and subject, cost approach for all appraisals, 5 comps minimum, pictures of all rooms and labeled, sketch of all levels including basement, photos of all outbuildings and estimated cost for each structure, plat map, PUD name, dues, condition, comparison to other PUDs, ALL prior sales of subject and comps regardless of 12/36 month industry standard, site size for condo (entire condo development), photos of condo amenities, clubhouse, tennis, pool, etc., 2 comps within project, two outside project plus two active listing or under contract, new construction with as-is value in addition to subject to completion value, corrections/revisions within 12 hours, etc. with 9 more pages of requirements.
You were also expected to follow QVS Appraiser Etiquette:
Dress professionally, business casual, no flip flops or shorts, do not bring children, pets, family members or friends, do not complete inspection without homeowner or entry contact present, not communicate any comments about the property which could be construed as negative, should not comment on any lender related requirement, appraisal fees, etc.
And you had to agree to the terms and conditions of their independent contractor agreement:
Any and all inventions, discoveries, developments and innovations conceived by the contractor during this engagement relative to the duties under this Agreement shall be the exclusive property of the QVS; and the Contractor hereby assigns all right, title and interest in the same to the QVS. Any and all inventions, discoveries, developments and innovations conceived by the Contractor prior to the terms of this Agreement and utilized by Contractor in rendering duties to the QVS are herein licensed to the QVS for use in its operations and for an infinite duration. This license is non-exclusive and may be assigned without the Contractor’s prior written approval by the QVS to a wholly owned subsidiary of the QVS.
Right to Injunction: The parties hereto acknowledge that the services to be rendered by the Contractor under this Agreement and the rights and privileges granted to the QVS under the Agreement are of a special, unique, unusual, and extraordinary character which gives them a peculiar value, the loss of which cannot be reasonably or adequately compensated by damages in any action at law, and the breach by the Contractor of any provisions of this Agreement will cause the QVS irreparable injury and damage. The Contractor expressly agrees that the QVS shall be entitled to injunctive and other equitable relief in the event of, or to prevent, a breach of any provision of this Agreement by the Contractor. Resort to such equitable relief; however, shall not be construed to be a waiver of any other rights or remedies that the QVS may have for damages or otherwise. The various rights and remedies of the QVS under this Agreement or otherwise shall be construed to be cumulative, and no one of them shall be exclusive of any other or of any right or remedy allowed by law.
Termination: QVS may terminate this Agreement at any time by three day’s written notice to the contractor without cause. But contractor by 30 day’s written notice!
Payment: payment on the 30th day of the month for work from the previous months. In short 60 days. They also can deny payment if contractor does not strictly adhere to their requirements. You also agree that the amount paid is “reasonable and customary” as defined by Dodd-Frank when you accept the assignment.
The revisions were endless and they wanted me to explain every single adjustment, how the dollar adjustment were determined, add specific verbiage such as “there are no repair items needed”, “utilities and mechanical systems, and appliances are in working order” “utilities were on”, statements on noxious odors or noise, on all reports regardless of loan type, update status several times a day (updates were never read and different people would email asking for the same updates), appraisals were rejected if you included an invoice in your reports, reports were reviewed by non appraisers, and when value was lower than the contract price, they wanted the MLS sheets and photos of all the comps used and specifics on every single line item adjustment. You also had to explain why none of their comps (usually 10+) were used.
I did 5 appraisals for them and to this day I don’t know how I lasted that long with their low fees, the micromanagement, the slow payments, the ever increasing requirements to provide lots of time consuming information and analyses which didn’t contribute to the accuracy or reliability of the report.
This is a prime example of why it takes so long for the bank to get the appraisal.
I don’t understand why you ever did the first one for them? Some of the laundry list is normal boilerplate. Some is common sense but much is pure AMC BS. Five comps? Kiss my patoot!
All lenders should follow the VA way of doing appraisals!!! ALL problems would cease to exists!!! Some of you smart people should start screaming this at the right people if you can!!! If I can help, let me know.
Clear Capital has been trying to have the VA use them for their appraisal needs which would be scary
Yea, we all know about clear capitals quality hybrid appraisals!
Well said Chris ! VA has it right ! They are not bias, they are only interested in protecting the veteran, they don’t throw the appraiser under the bus, they compensate fairly, and submission of the report is in a timely fashion i.e. no scope creep and ridiculous revision request that are only there to justify the AMC or the employee of the AMC’s existence.
Correct, not only protecting the veteran, but also the lender, the investor and the appraiser from being pressured to “hit” value.
Who do we have to call to start asking for a VA type ordering system…..that alone would solve the “appraiser” shortage. Not that there is one, just one where We lucky ones can still work directly for lenders…and the VA. Take $10.00 for expenses or set up as a non profit !!!
I will sit in Washington DC for as long as it takes!
Let me now and lets get it done…I am sick of these idiotic blast emails from these a-holes !!!
You can help. Join AGA (janbellas@appraisersguild.org ) and we can use member volunteers in a LOT of categories. mike 714 366 9404
Just 2 days ago I received a request & turn time from Olde City Lending Solutions, who I had never heard of. After sending my fee of $450 & turn time of 5/6 business days they answered to send all my info so they could add me to their panel. 4 days later they sent the order over, which surprised me, but when I opened the order on AppraisalScope there were 14 pages of appraisal guidelines and another 7 pages of “lender specific guide lines”. I told them I’d be happy to furnish them a standard report but if they wanted all the other nonsense included the fee would have to be renegotiated to $750. Naturally they declined. And this happens all the time.
C&R is simple. If the majority of a panel will accept an order, direct assignment, at the standard consistently applied fee, without negotiation, then you know you’ve got a C&R fee. If you have to send it out, bid it, and shop it, that standard fee is not sufficient. We’re all employees now.
Detail the abuses of 10 years, that’s like a novel. Hand that reporter a login to the AF, link them with the Appraisal Scoop article lineups, backread everything here, including linked documents. Search WorkingRE IVPI proposal, read about how things could have been. Then they’ll have the framing to finally start their story up… We are the premier journalists regarding this issue. The power of the pen.
The question amc reps do not want to answer; What is your standard fee. The education advisement for appraisers which is no longer valid; The lender is relying on you to protect their financial interests. My name road bump, I am professional punching bag. The only persons I actually protect are regular consumers. There is a better way, but who in their right mind, when working on commission not salary, will turn down a customer. Solutions on lending side are simple, cut out the middle man and put every agent on salary not commission. Solutions on the appraisal side are likewise simple; require every single person tasked with distribution of appraisal orders to have the necessary experience, qualification, and accountability by requiring them to have appraisers licenses themselves. With no ethical restrictions, and a long track record of non enforcement for these issues, distributors can do what ever the hell they want. Do you believe in coincidences?
I have worked for TSI/Quicken Loans for 17 years with no problems. I did an appraisal in a rural area in Hampton, FL. The subject was a Realtor owned home and was selling it. I reported that the roof needed inspection due to finding water on the floor during my appraisal. I also noted that the ceiling drywall in the bathroom was wet. I used comps in the MLS area and came in $25k under sales contract. Never heard anything until two months later when TSI filed a complaint with the Florida Appraisal Board. The complaint had another appraiser hit the sales contract and the seller provided the other appraiser with a list of upgrades that they did. I did not get such list. Also in the complaint was a letter from a roofer stating the subject had maybe 2 years life left in the roof. I did not get that letter from roofer. Now I have to meet with the state investigator to prove my work. Now TSI/Quicken Loans want me to sign a vendor agreement since I do VA work for them. Retirement is 5 years out and I cant wait till it gets here.
Don’t sign the agreement, you don’t need to working with VA
That’s messed up Don , it’s too bad you can’t throw them out of a window. Unbelievable.
TSI is not the same company it used to be. It is all about checklists and fitting in the box. Their “it’s either black or white” mentality is the issue. Sadly, they do not trust their employees to actually uses their brains. Fired them months ago over a mandatory due date within 48 hours of inspection. They simply do not understand the appraisal process and what is entailed to actually complete an appraisal.
Let them choke and die off !!!
Troll Alert: This comment/commenter was flagged as suspicious!
TSI now Amrock has changed and they are delusional. I was even told by their Director of Vendor Management named Donna Chabot that they are “black and white” now because they are losing business. She also went on a rant about how they are willing to go through as many appraisers as they want to and don’t care and value partnerships like they used to and their policies have changed and hung up the phone. I looked her up and she use to own her own company and now she has to work for an AMC!? No wonder she couldn’t hack it as a real appraiser…she is a vicious ***profanity redacted***
Don you do not continue to work for people that turn you in to the state. Period. TSI does NOT have a good reputation. You were turned in not to punish you or even educate you. You were turned in to enable THEM to show a proper paper trail for what would otherwise have been a violation of Dodd Frank.
They shopped you. Too bad you can’t find the name of the other guy out that gave it a clean bill. By the way, when did two years estimated remaining life become acceptable after you disclosed moisture? You already know you did the right things. It’s frustrating but just keep doing things the right way for the next five years.
PS – Unless your report was bad, do NOT sign consent agreements with state! IF you are an AGA member send info to janbellas@appraisersguild.org and we will help you defend yourself.
I am a staff appraiser for TSI. I was recently penalized for not being able to complete inspections on properties for orders I received just prior to a blizzard. Roads were not passable for several days. This made it impossible for me to reach the properties to do the inspection . When I complained about being penalized because of inclement weather, they told me that everyone had been penalized. Just who do these people think that they are? For obvious reasons I prefer to remain anonymous.
Quit and go on your own !!!
Trust me !!!
How much worse could it be…..Get paid more, work less, work to live, not live to work….like they want us to do….
If you quit….they will call !!! Other Mang. companies will see your better turn times and want to use you…in their little f-up heads…its all about turn time…so They can solicit other lenders…..
Hey staff appraiser, Can you say Class Action !
Staff appraiser…just google who the lawyer was who handled the Bank of America case and is the same one handling the new Core Logic one….He KNOWS what he is doing…..easy money !!! And it put them in their place !!!
Chris Edward Meleshinsky, an affiliate of that firm has spoken with us at length. Staff appraiser would have a great shot at a suit. They are looking for suits involving miscategorized staffers or those forced to work OT to meet routine expectations of productivity or turn times. Email me direct for his email., mike
I don’t feel bad for amc staffers, the better appraisers walked away a long time ago.
I have at least a dozen stories to share. Will be adding to this discussion.
We need a Federal mandate that all GSE work is to be assigned by a State rotation panel copying the VA system. AMCs are irrelevant overnight!! It doesn’t have to be forever but AMCs have become so entrenched and corrupt they are manipulating State Boards and AARO. It has to stop and we cannot do it as Independent Appraisers. Truth
Eric, In my opinion we absolutely do NOT need a federal mandate for appraisals to be assigned by a rotation system. There are many of us that do not work with AMCs and have built our business with clients that are not involved with AMCs. Our little office has not prepared an appraisal for an AMC in over ten years. There are still many lenders out there who maintain their own appraisal panel. The appraisers on their panel are selected using a rotation system. These are not the big boys such as Chase or Bank of America. The banks I am referring to are local and regional lenders. Of course i will be told that appraisers cannot make a living if they do not work with AMCs.
Wayne, I do appreciate your argument HOWEVER… things have gotten so rotten here in Denmark we need a clean sweep. Most the of local lenders have been FORCED to go with an AMC as their only viable business decision. THEY don’t like it either and they KNOW their clients are getting ripped off and local Appraisers are being beheaded. YOU need to consider that while you may lose some closeness with your “relationships” – you will gain many others with a statewide rotation. WE will be forced to work TOGETHER for the betterment of consistency in reporting and our profession. WHEN order has been restored and AMC’s have been removed from the process we can return to a more professional atmosphere – but we will need a decent Barney Fife in each state to maintain order and professionalism. If you are caught cheating and manipulating data….. Barney WILL bring his bullet out, not for killing a deal, not reporting twice a day status or being late. The VA panel works for the most part, it could work very well with a few tweeks of common sense. But that’s just my opinion, I could be wrong.
I work for the VA, you are not wrong, I am BETTER at appraising (and we all know this) When they leave us alone. The VA has the system right !!! Tidewater is the best system I have ever seen to get the realtors involved and teach them about “picking comps” and showing them how appraisals are done…they don’t like it, but they learn…..
Lets get this shit done and END all this BULL SHIT !!! I am sick of hearing for the past DECADE !!!
Get Virginia to start it all (They seem to have it together) and then let the rest of ALL of us start sending letters to who we need too…endless letters telling those in charge the wrongs that have been committed against appraisers, borrowers and EVEN the poor Americans that have been FORCED to work for AMC’s across this country !!
Mike I will be calling you soon !!!
Hello Honest Appraiser, I am not saying you are wrong. Some appraisers were very happy to submit their application to every AMC on this planet in the hopes that they could make a lot of money. Some of us found out real soon that all AMCs suck and turned away from that method. Some of us have worked real hard earning the trust of local clients and building a reputation that allows us to reap the benefits of our efforts. It is nice to be able to pick and choose which assignments we are willing to take. We set our fees and turn times. We turn down full fee work every week. I am in NO hurry to give that up to be placed on some damn state rotating list. I absolutely refuse to ever work for any AMC and will concentrate on Hwy. department, governmental, or court work if necessary. Many of us are just not going to have some nitwit AMC telling us how to dress, how to complete our report, what we will be paid, etc. Appraisers could change all of this if we just wanted to. If we merged ALL of these numerous appraisal organizations and coalitions into ONE unified group. This group would NOT ask whether you have a license or a general certification as there would be no distinction in membership. Absolutely NO designations. This one group would become the group that all media and government agencies would use to get the input from the appraisal industry. This group could get some attention as we could form alliances with various groups such as NAR and builders association. This could work without having to pay a fortune to belong to an organization that only wants to sell us continuing education. We could make this work and change our influence into our destiny forever. However….YOU and I know that we won’t.
I agree.. we will never be able to pull together as a group with strength.. which is WHY we need the solution I am proposing. It doesn’t have to be forever – but it is our only way forward I’m afraid. I work with the VA in a military area and it is by FAR the best working relationship I have experienced in Appraising. I am respected by the lender and the client and the VA backs me up on my decisions – as long as they are supported of course. Without “help” from the Federal level our Independence will always be taken advantage of. But I understand.. “be careful what you wish for.” Peace
I concur !
See Wayne, No offense but your attitude is what many have…and is what is actually holding us back…I know you mean well and are doing fine…..So am I, I am just sick of this bullshit….many would say, let the markets work it out, and that is what we are see, its happening now with the so called appraiser shortage….ya right, just people like you and I are saying no to the A-holes out there….The younger appraisers can NOT get into the local banks until the older ones retire and die off…so they are stuck and being pushed out or just blowing their brains out.
That is truly what the problem is, and us old timers could CARE less !
The VA system is the way to go…You turn yourself on and off when you want or need too….When you don’t have to jump through hopes with AMC’s every hour, you have the time to spend a little longer on the more complex ones….
The VA system works and is a GOD send !!! And you get paid quickly cause none of these A-holes want to be charged late fees..($25 per month)….Can you imagine getting paid a week or 2 after send in your report ???
What a concept……..the right one !!!
Americans are supposed to be equal and what do veterans serve for if these protections only extend to them? The fact the VA panel is the last safe haven is a damning indictment on the entire lending industry. These financial protection rules are well understood by lenders but immediately ignored once a non veteran steps in. Ethics are long gone from this industry.
‘The Market’ IS working it all out. Nine years after HVCC destroyed our profession we now have things like hybrids in India; and evaluations performed wit the assistance of less than minimum wage picture takers.
When “the market” is incapable of sensible or semi rational self correction in nearly ten years then it is time to give it an assist. Particularly when the same mentality that caused the last crash is being considered ‘forward thinking’.
Yes Chris, I see your point. My attitude is not all that different than many fellow appraisers. My next birthday I will be 67. In 17 days I will be leaving on my 14th cruise. I feel like I have paid my dues. I have been on the VA panel for many years. It only took me 12 (TWELVE) years to get on the VA panel and that was with an honorable discharge from army service. You will find that a large percentage of appraisers are nearing retirement. I have said for many years that AMCs cannot manage appraisers if they do not have any. I do not work for any AMC and encourage others to do the same. Other than that I do not know what I could do to make any difference. i do wish all of the younger appraiser the best!
Get over it. It is selfish and short sighted to continue that stale argument 10 years later, having watched obviously unethical companies operate a successful ponzi and extortion scheme at the expense of so many licensed appraisers and grow to completely dominate the regulatory landscape. Stuck in time lately? FNMA needs another bail out suddenly. The fed has buried QE in real estate, inflation is picking up pace. Fractional reserve lending and fdic insurance continues to insulate lenders from taking any real risk. Guess what comes next. Now whom wants to refinance again 2 years later, save you fifty dollars bro.
IVPI Proposal
Eric, No piecemeal solutions anymore. I think we need full federal regulatory control of ALL GSE appraisals but that is not the same as saying a federal requirement to eliminate free enterprise such as it may still exist.
Make FIRREA mandated licenses federal responsibility and enforcement. At same time make THAT agency the single contact point for all appraiser complaints about AMCs or lenders or their loan officers violating DF. Similarly make license investigations performed by qualified volunteer panels in states we are located in. Require payment in full at time AMC accepts our job bid and assigns order to us.
Non fed appraisals would either remain at states or become unregulated (I suspect most states will drop state licensing without federal subsidies and grants since they are rarely self sustaining anymore and would cease to be completely, without fines.
I agree Mike – for GSE work at least. Credit Unions and others can still order direct but could also benefit from the rotations where there are limited Appraisers.
When there are no rules for the big players, the little guys have no choice but to follow or fall. Distributor oversight is a myth, individual states can not afford to stand against billion dollar national companies.
Eric too much opposition to rotations from appraisers and other players such as those you mentioned. We/they all like to think we have some degree of control (an illusion at best) that prevents us from implementing common sense solutions.
In many respects we are still our own worst enemy.
The more regulation that is applied, the more taxpayer backing the lenders have access to, the further away from free markets we get. We’re dealing with parity pricing now, right here in appraisal. Our primary use to appraisal distributors is to build their assets, not to protect the liquidity of lending. Rotational distribution would provide a little window of market correction that is vitally needed to sustain the industry while we continue to wait for a return to sound money.
NORM Economics
The only ones who oppose the VA panel are the one that are not on it. True Dat. It ain’t perfect but beats the HELL out of working with ANY AMC in existence.
Truer words have never been spoken!
Agreed !!!!
These lenders hand out refinances like candy, purposefully hiring poorly qualified people and using third party services to make sure higher volumes of loans go through with less scrutiny. They do anything and everything to circumvent checks and balances. Every single person in the process advocates for the seller, except rarely, the appraiser does not. As nobody ever goes to jail for crimes in real estate, and the commission based people never personally get fined, they operate with virtual immunity full time. Dude, care to refinance, the rate is like down a quarter point from last year.
Back on topic of AMC abuse…. Inflated numbers: Are builders, lenders and appraisers working together?
The fact the guy was still willing to pay, in fact, set the market. Builder raises the base pricing and domino effect where many locals refinance away from builders terms comes next. Job creation. Consumers whom prioritize the buy over the value are an integral part of the problem. If buyers had to contribute cash with 80/20 max restrictions, upward movement would be more legitimate. Now, lets talk about the difference in appraisers fees, the sourcing of both appraisers distribution companies, and kickbacks from the amc to the originator.
Even better, let’s hypothesize about how many similar events happen without any appraisal check and balance in the under demin 250k ranges and how with the proposed upward demin 400k proposal, the home owner would have been none the wiser under proposed new rule sets and would have never even dealt with any supposedly independent appraisers in the first place. If both appraisers and both lenders could have simply sourced avm’s from corelogic or clearval, this discrepancy would never have occurred. Fixed it for ya.
He wasn’t really willing – he was strong armed due to his circumstances and then tried to fight back. I’m betting he is “unemployed” as of today and the house went into foreclosure. Hope not but I never saw a follow up story on this case.
His decision to follow through effected many more people than just his circle. It happens ten thousand times a day, consumers are pressured and reach for credit. Credit itself is very dangerous. Easy access to credit and lack of cash contribution requirements perpetuates unchecked market acceleration. This is what I mean when I say they’re burying QE in real estate. The fact that appraisal order distributors make obscene profits and rake as much if not more than the actual licensed appraiser serves as a financial incentive to promote acceleration of more credit and more lending availability. They’re lobbying for such every single day. There is no ‘safe access’ for consumers. A citizen does not own a property until the final payment is made and the title is in their vault, not the lenders. Enter clouded title and the MERS debacle, the rabbit hole goes deeper. If consumers are not lined up to at least swap down to a 15, they’re doing it wrong. The policies which drive economic uncertainty in housing are mainly on the origination side and have nothing to do with appraisal regulation. There is no regulation that can be applied to the valuation industry which can provide balance or correction to an out of control oversized lending system backed by taxpayer dollars. Guess what happens next.
I was attacked by an AMC for pushing back on wasting my time and not paying for it. A local lender had chosen to take the AMC route when pushed by the FDIC. I tried working with them in the efforts to keep my relationships with the lender which the President is located across the street from my office. I challenged the AMC on asking for multiple revisions and that I might have to start charging them for extra reviews. 2 days later they sent my former client an email stating “Mr Appraiser has chosen to remove himself from the rotation”. I was given a copy of the email by an officer of the bank and waited for the AMC to notify me in writing per NC Appraisers Act. I waited for 3 months with no notification and then filed a complaint with my State Board. They investigated and allowed the AMC off with a “Warning” without even being named in the public file. I lost a full year of fees from my client but I am back on the panel… except last fall I did not get a single order from Sept thru Dec so I called… “Oh, your email has been altered by mistake!!! We will correct this right away”… Do I feel the AMC $ and attorneys have influence over my State board?? YES.
It is also disconcerting to me that at last falls AARO.net conference in DC (Association of Appraiser Regulatory Officials) THERE WERE MORE AMC REPS THAN ACTUAL REGULATORS AT THIS CONFERENCE!!!!! This system has been nothing but a money grab for AMC’s and they are taking full advantage of maximizing their profit by driving up the cost to the borrower.. and then beating up the Independent Appraiser for the lowest fee possible. They are getting paid $Millions from both sides while Appraisers Resources have been strangled into petty cash. I used to keep 2 staff people and trainees – now it’s just me hoping the car doesn’t break down. More AMC stories to come if needed – I have dozens.
RE AARO It is a behind the scenes lobbying activity for state officials that are not otherwise allowed to lobby for changes themselves. At BEST, they get boondoggle junkets paid for by others and a break in their office routine. I used to love such trips when I worked for IRS. Like paid mini vacations.
In practice, my belief is that they are a place where misinformation is shared, and direction on how states can side step USPAP themselves for enforcement activities is promoted. AARO was never envisioned by Congress when FIRREA created the framework for ASC & TAF. It’s an invention of bureaucrats for no legitimate purpose.
Killer story. Amc’s are above the law. These are literally billion dollar companies. Every single dollar they earn is siphoned from the appraisal industry and not paid separately. You lost staff and the ability to train, they hired twice the staff for a lower rate, and even fit in a few high paying tech jobs in there and might also now offer stocks. Job creation. You’ll be the next to go if you keep working with them, they will return the favor. With no individual licensing requirement for distribution companies or their workers, there is no ethical restriction or effective oversight to slow them down.
Another point in fact of letting the market take care of its self.
I am turning 52 and one of the younger appraisers left….some are younger but not many…been certified for 25 years.
Here is how I look at it…..I have trained 2 appraisers, my office considered one of the best in the country…didn’t take anyone’s bullshit and sent them packing, built my business with Real clients….Every one happy except the ones who wanted, demanded or just expected fraud from my office……….I have lots of stories..
I also know many many appraisers who had to jump to review because they were refusing to play the “game”…
So here it goes, In 7-15 years when most of you old timers don’t even know your names anymore…he I will be and guess what…..I will have the assistants and I will be making the calls….and I promise you, Any AMC who does not sign MY agreements, wont get an appraisal done for entire states !!
That is when i start to teach again, under MY rules and My fees with proper compensation to MY people who work in the rain, snow, ice and blister heat to supply credible reports to the lenders. AND who work nights weekends and holidays because they know it is important to get these reports in.
I will say it again Old timers…hurry up and retire so I can personally FIX these issues.
AVM’s are fine with equity in the houses and in cookie cutter market areas, but not here on the east coast of America…West coast guys, that is your issues…sorry !
All we need are 3-5 reputable appraisal companies in each state to take care of business….
LIKE IT USED TO BE !!! before state certification put all of us in own own little houses to be abused by the big boys !!!
Their day of reckoning is almost upon them !!!
And They f-in know it !!!
Amen to that Chris. I have told some of the biggest AMC’s to take a hike. And they call me more and more as the old timers are retiring. Too bad for them because they are the problem and I have identified that. Any AMC that requests my services is under scrutiny. I will choose either to further our relationship or not. I control who I work for not them.
I told Wells Fargo, so they would NEVER call me again…to change my name to Chris GO FCK Yourself …..Last name withheld for obvious reasons…lol
Why you ask….cause they lowered their staff appraisers pay to $10.00 / hour with over time my guy was paid $11.40 to some expenses….
When I went in to close all my accounts the little girl behind the desk asked why ???
After I got done telling her, she says this….”ya, I am sorry about that, I heard about that….BUT WE are MAKING a lot of money….!!!”
I told her, her company created financial hardship to over what… a 1000 appraiser family across the country !!! She just looked at me like a dim wit $10.00 an hour worker drone, she had to be only 20 years old !!
Can you imagine saying that to someone who just told her to cancel 6 accounts???
Interesting, I just read in AMC Buzz that Wells Fargo is training the next generation of appraisers. Author is Karin Trost. Really ? Should Wells Fargo be in the valuation space at all much less train appraisers? Talk about the fox guarding the Henhouse!
They completely forget the biggest thing…… if the trainee does not want to move to an area that actually needs an appraiser, all they are going to do is over supply…….. which is probably what they want. in some areas.. but is that not wasting their time or money ????
I think the name “Wells Fargo” is sufficient to never work for them. I suspect they only keep the name because trademark office wont let them use ‘Fraud Incorporated’
Yep. They are on my blacklist too
I am new to the appraisal world, I love the appraisal process but have the hardest time actually getting the “experience” to elevate my license due to the lack of support from the AMC module. Most appraiser will not take on the “trainee” because it’s too much of a liability for them if something goes wrong. The Georgia state board requires logged experience hours under a supervisor but there are no supervisors willing to take the liability, i.e. it’s the whole “entry level position but most have 2 years experience” hurdle. I did work with an appraiser mentor who worked with an AMC, I assisted with an appraisal that came under scrutiny by the homeowner, he was told he had purchased a new construction home however tax records showed the bones of the home were much, much older, classic case of gut and remodel. The valuation came in low as the market was littered with gutted remodels selling around the final appraised value and the customer was pulling comps that were brand new construction and comps that were much further out from the subject neighborhood. My mentor was ultimately blacklisted from the AMC for having a trainee assist with the process. Still no word as to what was wrong with the original. I recently read the AQB requirements have been improved however, it’s hard to say whether Georgia will adopt the new requirements. Any advise to someone looking to gain experience in the field but is running into dead ends?
Take one or two recognized credible courses such as AI principles and whatever they recommend as the next step. (Im not their biggest fan but they do offer good courses AND having passed those courses tells other appraisers you are serious about your career.) Good luck… also sign up for facebook group 100%RealEstateAprpaisers group and seek out Mark. He’s a Georgia appraiser. He’s also the one that has to approve you for membership in that group so he won’t be hard to find.
I’ve heard mostly unpleasant things about AI with the exception of a local appraiser telling me to take their courses. Also, I can’t find the FB group you’re referring to.
100% Real Estate Appraisers on Facebook. It’s a “secret” group so you may need to search for Mark Sapinetz also for permission to get in.
Skapinetz – sorry
Soon the only access point will be at assessors, management companies, or commercial side appraisal. Avoid facebook. Your data is on the permanent record, routinely sold, and there is no actual privacy.
Go to hell Core Logic & Rels Valuation. GTH Wells Fargo and GTH THE SELL OUTS @ ALAMODE AND MERCURY!! They are ALL P.O.S.
gosh….what can I say judging by the 70+ responses? Of course the AMCs doing the business for their PIMPS the lenders are the devil. we all have a multitude of stories to tell as do I. but the issue then should be…..why the hell isn’t anything being done to stop the lenders from their still predatory actions? I’m so tired of complaining I can’t complain no more. I do my job……burn bridge after bridge…I’m 64 and don’t really give a damn anymore about doing the right thing. I mean I do the right thing and if an AMC or lender questions it………..f*** you is all I now say.
Fred we have been trying to get many people to do more than complain futilely. Join us at http://www.appraisersguild.org
They are all money grabbing mother F*** who are allowed to actually own the AMC that they are doing business with how f up is that.
https://www.housingwire.com/articles/42556-monday-morning-cup-of-coffee-countrywide-landsafe-accused-of-fraudulent-appraisals-during-housing-boom
I agree with the above comments re TSI (Quicken Loans) aka “Rocket Mortgage”. Get them in and out as quick as possible! When Quicken first started in the mortgage business, they were a pleasure to work with and they were willing to be educated re the appraisal process until they created TSI. TSI wants to educate the appraiser; maybe they don’t think we have taken enough classes or have enough experience! They even spend a lot of money on a glossy “A Year in Review” magazine that is all about micro-managing the appraiser.
I must be off their preferred list because I always point out that what they are asking is not part of the appraisal process. For example, TSI wants the report to include a “farm list”. I had never heard of that before but they want a list of possible comparable sales in the neighborhood to be included as a one line print out for each property. Never mind that I explained that a property was either a comparable or it was not. In any case, if you return a report that includes a value that they question, you will also get a list of sales (maybe up to 5 or more) and a request to comment on why you did not use the sales that they have cited. Standards Rule 1-4(a) requires “When a sales comparison approach is necessary for credible results, an appraiser must analyze such comparable sales data as are available to indicate a value conclusion.” So, the appraiser must determine what data is relevant. It is not up to the “client” to hint at what sales should be used in a report and it is way beyond the scope of the appraisal to explain why a list of sales were not used. It is not the appraiser’s obligation to explain why each sale was not used. It seems to me that the “client” is cherry picking sales to influence a value. I explained my reasoning and cited several conflicts with USPAP when they ask for other sales to be either used or explained why they were not. Needless to say, I have not been receiving requests for appraisals from TSI in the past 3 years.
Based on the details included for this past experience, it appears that the appraiser is about 95% in the right–that said, I do agree with the AMC agent regarding the lack of an explanation for the difference between the purchase price and appraised value…I wouldn’t say it was “reckless behavior” but more so ignorant since USPAP SR 1-5 states that all agreements of sale must be analyzed…if there is a difference between the appraised value and the contract price, it is only logical for an explanation to be provided. The explanation doesn’t even have to be correct but it is necessary that the appraiser makes an attempt on explaining the difference.
Daniel, real estate agent not the “AMC agent” as you describe it. The AMC made no comment and did not act as a firewall in this instance but simply collected their fee and moved on to the next deal. The conversation was between a Bank of America employee (the AMC’s client who lied by the way) and the buyer’s real estate agent only. The appraisal clearly stated that the contract was analyzed and that the appraiser was unable to justify the contract price utilizing the best sales available. It’s kind of hard not to do that given the layout of the 1004 form. Don’t you think that if there was a USPAP issue, the board would have pointed that out and acted accordingly and not dismissed the complaint? I’m not sure I follow what you mean that the explanation does not have to be correct?
I think Daniel’s issue is the degree of analysis or reporting of it. USPAP has no set rule on how far one has to explain after an analysis. The fact he said he knew the sale price; analyzed the contract and that market data did not support it meets the analysis requirement (in this sentence). I’m not exactly known for brevity of explanation but even I stopped trying to fully explain or justify appraising a property below a sale price anymore. It’s not necessary. Its not my job to explain why a buyer offers more than a property is worth. I’m not a mind reader.. The original intent of the requirement is to determine if non market incentives or undisclosed conditions appear to be a part of the deal.
Like so much out of TAF these days, original intention and purpose takes a back seat to some one size fits all presumed rule.
ANALYZE VERSUS MAKE A COMMENT ON ARE 2 DIFFERENT THINGS. sorry. so let’s say I want to say the buyers were not represented by a “true” buyers agent and made an offer outside the ordinary value range. how much grief would this cause me? when have we ever been able to state our true thoughts? like yea…ahhhh…I was in the ghetto and a drug deal went down right next to the house I’m appraising. that won’t go well either will it? as others have written: the truth can’t be told. so take your comments on a lower value versus the actual sale price and stuff it.
It would have caused plenty of grief if the appraisal was later reviewed by a competent review appraiser and comps in the immediate subdivision were omitted by the OA (especially the recent sale of the house next door) and included by the RA. Is it appropriate to ignore recent sales and listings inside the subjects subdivision and go outside it just to make the deal work? I don’t think so. That’s called “rubber stamping” and that’s inappropriate any way you slice it! Looks to me like the appraiser was 100% in the right. I’ll have to agree with Fred the buyers agent DID NOT have his clients best interest at heart and was only after the commission. I wonder if the buyer even knew that two appraisals were done on this house?
Reverse mortgage (death of father) due after death w/ distressed home severely underwater.
Why would a mortgage servicer hide, deny, lie about whom their Appraisal Management Company is? I am a buyer who had the same appraiser hired by the unknow AMC three (3) times in a row within eleven (11) months at the same residential home. A drive by appraisal, walk thru appraisal, and Last & Final Appraisal. There were problems w/all three appraisals with overvaluing by substantial margins & ignoring all necessary repair & restoration. Mold, Lead Paint, FEMA 50% rule & depreciation ignored as well as elevation certificate & re-valuation by the local county appraiser. Even after filing complaint thru the Consumer Financial Protection Bureau the Mortgage Servicer responded by directly lying in writing as to who the AMC was. Champion Mortgage (Nationstar; aka Mr. Cooper) replied back stating the AMC was a company called ResNet. I called ResNet directly and was informed they were a Software Platform handling various different duties, but they do select a list of Appraisers to give to the Mortgage companies but they Never select the appraiser.
It is my belief that the Mortgage Lenders even after the banking collapse in 2009 with all the Overvaluations are still setting and or controlling the valuations of the residential homes. I would like to learn how the AMC’s are brow beating and strong arming the appraisers into raising and or lowering their valuations to meet thresholds of the AMC for the Lender. I’m in way over my head, but learning constantly after pursuing this for almost three (3) years. I have filed multiple complaints w/ the FED & State agencies but other than documenting the facts these agencies give the consumer little to no support.
Jim, you covered many diverse topics in your post. You obviously learned a little about the process but still don’t understand that there are cases where no AMC was (is) involved. AMS or appraisal managed services (semi-automated) may have been used. You are also going after the wrong target (imho) from what was posted.
1. If the appraisal(s) are defective file a state complaint against the appraiser’s license. Most (or at least many) states have a fund where users can be reimbursed for fraud losses.
2. If CFPB has no interest or ability to resolve your case contact the Financial Crimes Enforcement Network of the U.S. Treasury Department (FinCEN).
It should be next to impossible for a reverse mortgage to be underwater. They start out at a 50% limit and beyond that the historic practice has been for lenders to further ‘cut’ the appraised value on reverse mortgages rather than to inflate them. It enhances the yield indirectly by delivering a reduced risk mortgage that instead of being an ostensible 50% LTV, may in practice only be a 30% to 40% LTV.
PAY someone (competent) to review the most recent appraisal used to finance the property for a (cash out) reverse mortgage as of it’s the effective date. Then send that review along with the original report to the state. LET THE REVIEW APPRAISER KNOW it is your intent to send it to the state!
Good luck. None of us support or condone fraudulent loans, appraisals or policies that defraud consumers. Call me if any questions. (714) 366-9404 (AFTER 10 AM California time please). Any day.