Deceitful Little Lies

The Appraisal Management Company Business Model, Deceitful Little LiesAt some point, appraisers need to take a stand against the appraisal management company business model. There are simply no benefits to appraisal management companies and there is no accountability for their actions. Haven’t we all been abused enough? Do the lenders really understand they are responsible for every action of the appraisal management company? Do the lenders really know the questionable ethics of the appraisal management companies? Are the appraisal management companies lying to the lenders?

Deceitful, liars, bait and switch, trickery, fee shoppers, bottom feeders, empty promises and illegal activity are some of the nicer terms used to describe the actions of appraisal management companies. It does not matter which appraisal management company you are referring to, they all pretty much operate the same; with questionable ethics.

How many times, have appraisers received a bid request asking for your best fee and turn time? What about a phone call asking for the same? What about those laughable statements “so we can assign you the order right away” attached to the request? How many emails are addressed to “undisclosed recipients” or to the sender? How many times have you verbally accepted an order over the phone after getting your fee approved and then the email comes over stating the assignment is no longer available? We all know they kept calling around till someone agreed to complete it cheaper.

How many appraisal management companies follow 129E of TILA and assign appraisals based on the competency and experience of the appraiser? How many appraisal management companies continue to shop the appraisers to obtain the one who will do for the least amount of money? If speed is so important, wouldn’t it be best to go with the first appraiser to accept?

Has the amc provided any appraiser information on the property? Don’t we need to know this basic information to determine the appropriate scope of work in order to quote a fee and turn time? How many times has the appraisal management company’s employee quoted what Zillow says? How many appraisers just accept “the form” the appraisal management company orders as being appropriate?

What about those bid requests that come through a portal? Is the appraisal management company sending that request properly authorized (licensed) to operate in your state? Are appraisal management companies using the portals to circumvent state licensing? There is strong evidence to suggest they are doing just that! How many appraisers are doing their due diligence to determine if an amc is properly licensed in the state they are conducting business? Just because they use a portal, they still have to be properly licensed to operate in that state.

What about those reviews done by the appraisal management company. No disrespect to any reviewer, but can we all say clueless check boxers? Is the lack of a “.” after Inc really a reason to reject an appraisal report?

What about all those automated scheduling apps the amcs want appraisers to use? Is it not best practice for appraisers to actually talk with the owner to determine conditions, renovations, incomplete repairs etc. prior to the appointment? Having surprises at the property is not going to save anyone time.

What will it take for lenders to realize they are responsible for every action of their agent, the appraisal management company? Does the lender really know what goes on at appraisal management companies?

If appraisal management companies are supposed to be independent third parties, how are they allowed to have staff appraisers completing appraisal reports in the field? Could it be said the entity responsible for assigning business to you is also your competitor? Is this the bi-product of behind closed door meetings?

When assigning appraisals to independent fee appraisers, how many appraisal management companies take into consideration the C&R fee requirements of Dodd Frank which state they must consider the complexity of the assignment/property, the appraiser’s experience, the time frame in which the appraisal is to be completed, location, etc.? If state Boards were asking these questions during complaint investigations, would appraisal management companies act differently?

Now ask yourself this one final question:

Are you, the appraiser, enabling the appraisal management company by agreeing / tolerating their abusive practices?

By Advocate. The author is a Certified Residential Appraiser and has chosen to use the pen name Advocate to protect their identity. Many famous people including Benjamin Franklin, Agatha Christie, and Steven King have written under a pen name for various reasons. Just Google pen names used by famous authors, there are only 45,700,000 results to choose from.

opinion piece disclaimer
Image credit wikimedia - Michael Coghlan

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29 Responses

  1. Avatar Pen Name says:

    I’d rather have a bid request than an AMC automatically assigning me a job at half of my fee. Most of my work is bid request since I don’t really have a standard fee. I have a base fee but most jobs don’t qualify.

    5
    • Avatar Advocate says:

      How many of those bids do you actually win? If your fee is double what they are assigning, why waste your time even bidding if you are not getting the assignment? It is your business and you can run it as you see fit, but time is valuable to most and I personally choose not to waste my time with bottom feeder clients. I know my self worth. Do you know yours? Please stop be an enabler!

      18
  2. Avatar Kimberly DeFilippis says:

    You don’t have to accept any assignment that is automatically assigned by an AMC. Just say no. Take your business back.

    17
  3. Mark Joel on Facebook Mark Joel on Facebook says:

    Simple, don’t do work for them. They need us.

    15
  4. Avatar SB says:

    https://portal.ldwholesale.com/portaldocs/yoda/wholesale/Appraisal_Fee_Schedule.pdf

    This above is the most up to date LoanDepot Appraiser Fee Schedule.

    These are the amounts LoanDepot pays AMCs who then proceed to skim 30-50% for themselves Notice the add on fees. Has anyone been paid an extra $400 for a complex-rush assignment lately?

    Now notice how Coester AMC at bottom right of page is STILL considered an approved AMC. IT’S PURE BULLSH*T

    Is anyone besides SKIPPY paying $749 to be RIPPED OFF at the upcoming VALUATION EXPO?

    Here’s their Bottom Feeding Sponsor list:

    Anow, Accurity, Appraisal Buzz, Appraisal Institute, Axis, Bradford Technologies, Clearbox, Computershare, CoreLogic, DataMaster, Fannie Mae, Freddie Mac, GeoData Plus, HUD, Intercorp, ISBA, LIA, McKissock, Norman-Spencer, PropMix, Sekady Capital, ServiceLink, SFREP, VA, Validox, and ValueLink

    13
    • Avatar SC says:

      Troll Alert: This comment/commenter was flagged as suspicious!

      There are some pretty reputable firms in that list of “Bottom Feeders” that you identify. Perhaps you should look in the mirror. I’d fathom to say that you’re the bottom feeder.

      0
      • Baggins Baggins says:

        How many numbers do I have to block before datamaster stops soliciting me? I hope we’re not flagging people resisting the corporate model as trolls now. Those are names of companies whom have turned this system sideways.

        2
  5. Chad Blackley on Facebook Chad Blackley on Facebook says:

    I do, I ignore them

    9
  6. Avatar Raymond says:

    I repeat, the AMC business model is NO friend of the appraiser. The AMC business model was created for and by lenders and lender interest groups. The AMCs are and have been carrying out the dirty work for the lenders, to obtain “cheap and fast” appraisals. Let’s all get real, the appraisal profession has lost all control of the lending appraisal process to lenders, via the AMC business model. Just wondering when, if ever, the appraisal profession will regain some control, to say nothing about some “professional respect”.

    12
  7. Avatar E J says:

    I received one recently that said to research the property before quoting my fee. I told them I would be happy to research the property but if I did not receive the request I would be sending them an invoice for my $50 research fee. 1 min later they cancelled the thing. Imagine that.

    14
  8. Avatar Bill Johnson says:

    The scam I’m starting to see is that after the full appraisal is ordered, and within a few days after assignment, its mysteriously cancelled. Actually, its no mystery as the appraisal is perhaps ordered via purchase contract requirements “appraisal to be ordered within 3 days”, but later cancelled after the borrower elects to take the appraisal waiver option (confirmed by agents during cancellation of inspection conversations). Most, but not all lenders could care less that 20, 40, 60 or 80% of the total time to complete an appraisal might just take place prior to the actual inspection being performed, but instead want to reward you with a big fat zero $0 for your efforts since taking the assignment.

    Although the VA just put in place some standards relating to capping fees when an assignment is cancelled (there to low!), at least they see the value of ones work prior to and post inspection.

    Seek the truth.

    10
  9. Avatar SB says:

    Look out below Bill

    Seeing “double top” patterns all over the West Coast.

    A double top is an extremely bearish technical reversal pattern that forms after an asset reaches a high price two consecutive times with a moderate decline between the two highs.

    8
    • Avatar Bill Johnson says:

      Good, I need a break. I’ve turned down 5 orders today, and have no time to respond to 5 other requests. Volume could go down by 75% and I would most likely still be at my individual daily capacity.

      Appraising is a funny thing SB, in that today I can only complete 1 in say 8 assignments that come my way, but yet with strict local 5 day expected turn times, I’m thus only 5 days from being unemployed (insert twisted face when explained to the general public).

      On a side note, as the local government seems to be the last to know relating to falling values and thus property tax assessments, perhaps it will soon be time to jump back into property tax appeal business (1,000 + completed 2006 / 2010). The good old days where I would walk a condo conversion development with say two plans (1 & 2 bedrooms), develop two value files and use the same market data dozens if not hundreds of times during the appeal process. At times our knowledge can be easy money.

      Seek the truth.

      7
    • Retired Appraiser Retired Appraiser says:

      No worries (yet). King Crazy’s billionaire pals will continue to prop up the markets until the summer of 2020 when it becomes apparent that he cannot win again. At that point they will go short in a very big way to make up for their losses. When that happens those 401Ks will become 100.5Ks.

      1
  10. So much truth to this article. The fact is that lenders & MISMO Members do not want either FIRREA or USPAP compliance…let alone Dodd-Frank.

    What they want is plausible deniability and continued certainty that there is not now nor will there ever be effective regulatory oversight of their actions. Not at least until the next crash

    As for us verifying AMC licenses, go ahead. Try it for your state. I was trying to verify one in an eastern seaboard state last week and after 20 minutes of trying to find a link to AMC licenses in that state, I had to give up. Appraisers are easy to find. AMCs? Not so much.

    While the FTC prosecutes Louisiana for spurious alleged Sherman Anti Trust violation, LD Wholesale publishes their price-fixing evidence for all to see. (linked in SB post above).

    Appraisers, even more serious than all the items Advocate accurately pointed out, is the elimination of USPAP compliance requirements for state regulator enforcing OUR USPAP compliance. The traditionally accepted metric of compliance contained in the Scope of Work Rule acceptability comments is now gone.

    No one outside of TAF and their phony premise, seretive Investigator I, II & III classes has a clue as to what metrics are now used. States like California now deny even doing review appraisals or appraisals. Though all their Real Property Appraiser/Investigators are required to be licensed or certified appraisers…and are paid accordingly under the state civil service pay scale. According to former Texas regulators I’ve spoken with, they are adopting a similar TAF/AARO approach.

    Some years ago California published reports that fully 50% of their overall revenue went for overhead and salaries from license fees and fines. Now that license fees have been reduced due to declining numbers of licensed appraisers, they are actively seeking ways to increase revenue through fines.

    Since the amount of a fine (guideline-based) depends on the specific number of alleged instances of non-compliance, it is to the states benefit to find as many instances of violation as their imaginations can conjure up.

    I wonder if they could realize any savings by firing all the Sr. Real Property Appraisers /Investigators? Seems like they have overqualified people performing investigations that don’t require appraisers for either appraisal review or alternative appraisals.

    Are these people getting paid more than the cosmetology or barber license investigators? If so, why? If they no longer do appraisals or appraisal reviews, then clearly they need no more background other than California Laws Enforcement training.

    8
  11. Avatar E J says:

    Why am I researching the property? If they want an appraisal just send it along & I’ll give them a report. If there is a problem with the property I’ll let them know within the report. Don’t waste my time.

    8
    • Avatar Advocate says:

      I can’t speak for others, but I want to know what I am walking into before I accept any assignment. I always do some due diligence before accepting. For the few times I didn’t, I regretted it … always an issue.

      11
  12. David Samnick on Facebook David Samnick on Facebook says:

    I will say the dirty word. APPRAISERS NEED TO UNIONIZE.

    9
  13. Sue VanLeeuwen on Facebook Sue VanLeeuwen on Facebook says:

    Yes, I just finished a night mare assignment. Again done with these amc, lies and bait n switch. One hand does not know what the other is doing

    5
  14. Avatar Cotton Cornell says:

    I have have had so many bad experiences with clear capital. I question why I even considered doing business with them.

    In one situation I performed a very easy appraisal assignment where the subject and all comparable sales were located in the same subdivision. All comparable sales closed within 90 days. All features were bracketed. I received a QC request asking for an explanation as to why I didn’t utilize 5 sales which the client provide. All of the clients sales were located in a completely different township/school district. All were significantly superior to the subject and all had a sale price based on a predetermined value. I called undue influence and clear capital demanded I research the sales and remove any comments regarding undue influence. I quoted the exact verbiage from the Dodd Frank bill which required the AMC to review all alternate sale data to determine wether it should be sent to the appraiser. They clearly failed! I ended up sending that to the state as a complaint however to date I have never heard anything. I refused to review the data as it had not been reviewed prior to sending.

    A second time clear capital sent me a quote request. I quoted $400 which is my typical rate. They assigned the order. I scheduled the inspection and a 4 hrs prior to the inspection they canceled the order. I found out from a fellow appraiser that he had been offered the order the day after I accepted the order. He had offered a quote of $350. Once he found out the games they were playing he declined the order. Clear capital then comes back to me with the lie that the client has decided to continue with the appraiser. I tell them I am fully aware that you reassigned the appraisal to a friend of mine who offered a lower fee. I alert the borrower to this who then filed a complaint with the client. Clear capital then lies and say it was a system error. In the end I declined that assignment.

    Another issue I had with clear capital was they like to try to schedule the appointment for you by sending the contact an email requesting access. In this situation the contact replied to clear capital however my email was not on the email chain. When I called the borrower to schedule the borrower says they already have an appraiser coming out to the property. I add a note to the system indicating what the borrower said. The day clear capital scheduled the appointment with the borrower I obviously did not show as I was not aware that clear capital had made the appointment for me. The borrower files a complaint with the client indicating I never showed and never called. I get an email from clear capital saying they have to investigate. In the end I never knew what they told the client however this was clearly all clear capitals fault. They should never be trying to scheduled the appointment for me as it clearly causes confusion.

    Other worthless AMCs are valuenet, streetlinks, xome and proteck. All are completely worthless and need to be investigated by the goverment for fraud, racketeering, price fixing and market manipulation.

    This is only a fraction of the useless behavior of the AMCs they are self serving and do not care about the consumer or the appraiser. I could easily go on and on about AMCs however it is the borrower and public trust that ultimately suffers.

    12
    • Avatar Raymond says:

      I completely deleted clearcapital almost 8-9 years ago. As you stated, they are bottom feeders and pound appraisers who take their cheap $ assignments. Streetlinks, I never did work for them because they are bottom feeders too.

      11
    • Bobby Jones on Facebook Bobby Jones on Facebook says:

      it will not happen which is not good… they have bigger pockets and will get all the hybrid work which puts the final nail in the appraisers coffin in my opinion.

      1
  15. Avatar Jack Of All Trades says:

    I remember when clear capital removed me from there panel several years ago cause I did not submit my new updated license to them with 2 more months to go till renewal… never did work for them anyways

    8
  16. It’s really hard for me to gin up any empathy for clear capital. http://appraisersblogs.com/clearval-value-hybrid-appraisal

    Impossible for me to generate any respect for them after seeing the above.

    6
  17. Baggins Baggins says:

    Look here. They sold it, you bought it. Appraisers whom continue to buy it should not be surprised that because of continued financial support, the companies maintain a static operational position and do not change. When it comes to amc’s, the appraiser is the primary customer, the point of profit or loss. You’re the customer now.

    Three out of four appraisers nationally refuse to work for amc’s. Think of it, the 25% whom take 80%+ of all the available mortgage lending workload, complaining they don’t get enough from middle management they volunteer to willingly work for. Nobody makes appraisers take those fees or stay on those approval lists. Amc appraisers continue to erode the stability of this industry, one accepted order at a time.

    2
    • Avatar Jerry says:

      Spot on!!!! Appraisers are their worst enemy!!!

      I don’t work for any AMCs, and have a back door if work dries up. All appraisers should develop one if they don’t have one. No one is going to help appraisers but appraisers. When things do drop (it will), most of the appraisals that I have seen from other appraisers are not USPAP compliant, and it will be the low quality appraisers that will be getting reviewed!! It will be the appraisers that worked for AMCs!!

      1

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Deceitful Little Lies

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