“Special” Type of Appraiser
It takes a “special” type of appraiser to work with AMCs.
While inspecting a property I received a cell phone call from a lender wanting to add me to their panel. I was unable to discuss the matter at that time and requested that she send the information to my email. I received nine pages of application.
The invitation starts out telling me how their AMC is a LEADER in the field (I never heard of them). They strive to assist all appraisers who are looking to maximize their time and quality. Their website allows them to monitor appraiser’s efficiency of scheduling and turn times (just what I enjoy the most). It is imperative (come on…Imperative?) that all assignments be immediately scheduled, notes updated to the website, blah, blah and much more blah!
This wonderful AMC continues with their standard foolish requirements: copies of license/certification; at least 3 years of experience; E&O of at least $500,000; Are you FHA approved? Ever had an E&O claim? Any discipline by state or professional organization? Provide three professional references with name and contact information (so that they can market to my clients). And do not forget to send two appraisal samples.
They continue for page after page explaining how I must accept this and accept that. How I must quickly do all of these things and a whole lot more. I must provide them with bank account info so that they may direct deposit my fee (which they did not inquire about) and then they tell me their payment schedule (what if I am not happy with their payment schedule?).
Appraisers MUST communicate with AMC only. Non-compliance with this guideline could result in removal for the appraiser’s panel (everything comes with a threat). Do not include the invoice when you upload the appraisal….(we are trying to cheat the borrower and need your assistance in deceiving them). Now the next part explains how I should select the comparable sales (how could I possibly know that without their help!). Next they explain what photos I should enclose in the appraisal (thanks, I always wondered about that too). Then they explain basement sketch, current real estate market, appraiser responsibilities, security, appraiser independence and undue influence (these folks are so knowledgeable; why do they need us?).
The next part is where they explain that I should be polite, professional, and prompt (gee, I never thought about that). I am told that I represent XYZ AMC and the lender and how I should behave (for 35 years as an appraiser I always thought that I was representing my own company. Where are they when I pay the office bills?). Next they tell me how to dress and what is not appropriate (they must have looked in my closet). Next I am told to be prompt for the inspection, to identify myself with the proper type of identification and deliver the completed report on time. Next they tell me what not to say. This crap goes on page after page.
These idiots called me, I DID NOT call them! What makes them think I am willing to extend credit to them? Where is the financial information I need in order to make that decision? YEP it takes a “special” type of appraiser to work with AMCs. “Special” Indeed.
By Wayne Courtney, Certified General Real Estate Appraiser with over 30 years experience, Realty Solutions Company in East Texas. He is a member of the national, state and local associations of Realtors and holds a GRI designation. Wayne has been appointed to The Veterans Affairs Fee Appraisal Panel (VA), is approved by the Federal Housing Administration (FHA), and is approved by the Texas Department of Transportation (TEXDOT). He is also a graduate of ‘SOARS’ presented by TRERC at Texas A&M University.
I now have a list I send THEM. Starting with please provide at least 3 recent references from appraisers you work with so I can see how they rate your quality control and timeliness of pay. I will not provide samples, I have been doing this job a long time I am a professional, redacting takes way too long. YOU do not dictate my turn time, I will provide it after I have seen the property and determined the complexities
You’re singing to the choir Wayne! However, you forgot to mention the backround check so you can do appraisals for the most dishonest people in the business.
We all know that the AMC business model is NOT a friend of the lending appraisers. Its an unfair business practice that has been impose of a powerless group of appraisers. Not a very good situation. The question has to be asked, when will lending appraisers stand up together and just say this is enough , no more?
what is a lending appraiser?
Hi Claire, I took it to mean an appraiser that works primarily in loan related appraisal work. I’ve heard others refer to them as ‘(GSE) Transaction Appraisers’ and a few other localized euphemisms.
You forgot the part about hold harmless and indemnification. I can’t believe that wasn’t in there.
The last time an AMC told me I had to do this and do that I asked them when was I going to get my insurance and vacation package! After a brief pause they were “what do you mean”. I said it appears I’m an employee of your company, not and independent appraiser. I would like my insurance and vacation package. After the few seconds of shock and awe I explained that I don’t work for them and they don’t run my business. I even had one AMC have the audacity to set up a conference call with the buyers of a property because I refused to set up and appt. in their time frame. I politely excused myself from the call, hung up, then called the AMC back. I would most likely be arrested if I typed in this forum what I told this AMC.
I wish I knew how to rally the appraiser profession against AMCs.
Donna, IF you are serious, contact Jan Bellas at the American Guild of Appraisers (AGA) at firstname.lastname@example.org
We ARE fighting this kind of stuff. Next target is the new TRID (pronounced turd).
Just for fun, maybe just as a test…let’s send a letter to our stock broker, insurance agent, lawyer, doctor, dentist, postman, surveyor, pest inspector, home inspector, CPA, Financial Advisor, lawn people, house cleaner, pizza guy, barber, etc. Let’s tell them that we will explain to them how they will do their job, WE WILL MONITOR THEIR INTEGRITY and to sign and return the letter asap! Any appraiser who would put up with that must be drawing food stamps and late on their rent. That is the type of crap that an AMC requires appraisers to put up with! No real man can put up with that, sorry if I offend some pitiful folks!
I just received an e-mail from a large AMC, I did some work for in 2012, but now refuse, due to their low fees, they asked for my updated info and if I would be willing to be added to their panel. I e-mailed back, sure if you provide me with your standard fees for 1004/1073 and 1025 and expected turn times. Needless to say, I’m still waiting for that e-mail. Thank God I no longer do any AMC work!
dont forget to ask them to submit a recent background check to you too. LOL.
the bleeding continues . . . . .
Do you remember the old school term “Special Education” now known as mentally handicapped?
Now you know precisely what type of appraiser AMCs are forced to rely on to keep their sweat shop running.
The above article implies AMCs can be trusted to calculate a ‘high C&R fee nationally’ to account for those properties that turn out to be more complex.
HOW is it ok for lenders and AMCs under the auspices of the CFPB to completely circumvent the Sherman Anti Trust Act and DECIDE IN ADVANCE what OUR fees are going to be?
Not only are AMC appraisers former passengers of the short school buses, but they also have a habit of bending over and grabbing their ankles everytime an AMC has a new idea or policy.
I think it is wrong to classify all appraisers who work for AMCs as special. Having been a certified residential, FHA approved appraiser with much experience in complex properties, I cherry pick the non-complex orders and turn down assignments when I can’t meet turn around times. I have about 6 AMCs I work for; some big and some small lenders, but I do estate work for attorneys too. Like any client, if you do enough appraisals for them and follow up on their ridiculous revision requests you can gain their trust. At a certain point you’ll start to remember all the comments you have to add, the aerial maps, basement sketches, etc to every report completed for them, and it will become a habit. Then you’ll start to put some of those comments into all your reports and eventually you’ll figure out how to simplify the whole process so that you can reduce your turn around times to meet their 48 hour deadlines and have one appraisal template which works for all your clients. Then you’ll be able to do two inspections a day, and work less than 50 hours per week. I’m not thrilled about the fees some of them pay, or the timeliness of payment, but I have turned down more assignments than I’ve taken and most of the time it’s because of the turnaround time. I’ve quoted fees on complex assignments for all of them and sometimes get the assignment; sometimes not, but it is typically due to the turnaround time. For some reason that is most important to these guys. I hate working for some AMCs, particularly Street Links because the underwriting process is mostly automated and they send revision requests on things that are already explained in the report, it’s just that I keep taking assignments from them because I believe eventually the AMC model will have to change, and my lenders who I have built trust with will keep me on their panel and will remember that I stood by them when others left when the AMC eventually goes away ( I hope). Whereas the appraisers who don’t work for AMCs will lose clients when the AMCs eventually go away. All it took was government action to make the AMC necessary for most lenders. We just need the government to make it unnecessary once again. Deregulation is key to our success. Maybe I’m too optimistic, so if that makes me “special” than I guess I am the type of appraiser you all criticize.
Although I’m sure I won’t find much support, I agree Clint that not all AMC’s are special just as all non AMC work is easy street. Most of my work comes from AMCs who have spun off internal divisions within the company that primarily offer a software firewall service (similar to Appraisalport) to their lender clients. In most cases I find the lender was unhappy with a once tried full service AMC set up and decided to take the process back themselves. Its a little old school as the lenders maintain a preferred panel (fair fees, treated with respect, etc.) but have firewalls in place to have the AMC assign orders via their systems (rotational, closest in proximity, skillset, etc.), maintain appraiser documents, etc. I have many issues with AMC’s, this profession, the leadership, government regulations, and so on, but ultimately each appraiser must make their own choices.
Retarded aka Special Appraisers aka Special Needs aka Exceptional Appraisers aka Mentally Disabled Appraisers. It’s all the same really if you accept AMC orders. Some names are simply considered to be more politically correct today than others.
Real men and real women refuse to accept AMC orders under any circumstances because they understand that paying out kickbacks is unethical.
Your statement omits an important alternative engagement; To drive the fee higher for amc’s than for lender direct, to accommodate the additional time hassles… I’m a special appraiser. I’m especially expensive if the amc does not engage in direct assignment practices. But I’ll still work with anyone, regardless. Most amc’s get a $550 fee, but direct assignment ones whom are friendly can still get a $450 if they play it straight. If all I get is left over work and the amc thinks that fee is for complex, that’s a whole different story. Complex only assignment usually starts $600, up to $800+. It’s not my job to play pickup sticks so the discounters can cherry pick. If I miss out on those normal routine orders for a normal routine $450, that’s when the price goes up. Lol.
There is some merit in what you say, and in other area potential concerns.
We all have to eat, and if that means taking AMC orders, so be it. (Ya gotta remember RA is RETIRED, and a bit of a curmudgeon to boot-but his heart seems to be in the right place).
Im a huge critic of one size fits all boilerplate, and if you are doing two assignments a day (start to finish, in an eight hour day) Trust me, you would NOT want me to do a technical review on them. We ALL boilerplate to some extent; and some forms are more pliable to specific property than others, but usually BP just sidesteps the appraisal issue being raised.
Example: frequently seen: “The subject is located in an area in which SFRs are primarily owner occupied therefore the income approach was not deemed applicable.”
Perhaps they MEANT “…owner occupied area. There is an absence of reliable and credible data sufficient for application of the income approach, therefore it was deemed inapplicable to this assignment.” I like it even MORE when they are ALSO providing an sfr rent survey for the subject.
Anyway-enough nit picking. Clint, the point is that you should be earning the SAME daily amount for ONE appraisal assignments as you currently do for TWO AMC assignments. No one is saying stop eating.
But answer this question to yourself only. When is the last time you did a REAL H&BU analysis on a routine SFR? I mean looked up the zoning map and development standards? LOOKED for vacant land sales for an SFR instead of extraction? Or are those boilerplate?
I rarely do two appraisals from beginning to end in one day. That’s almost impossible with all the stuff they require nowadays. I have office staff who set up the files, get tax info, zoning, legal descriptions, site maps, aerial maps, deeds and csms, check for prior sales, enter the sketch and comps into the appraisal software (my MLS does not support data master yet). I take all the necessary steps to form the appraisal, my staff does the data entry. So I suppose if I had to do all that other stuff it would take more than a day per report. I make a percentage of the appraisal fee, like 150 per report, so it’s not like I’m making much money. I hate how AMCs cut my income too, but it’s nice to have work. So yeah, living in the Midwest as an appraiser is the worst because almost every lender uses the dreaded AMC model and if you do a search for appraisal fees you’ll see the Midwest region has the lowest fees in the nation. If you research further you’ll see where the most AMC activity is and coincidentally the midwest is where the AMCs are most predominant. The same lenders that I was doing work for who switched to the AMC model, now pay 100 less per appraisal fee through the AMC and get a better product complete with aerial maps, charts, site maps, flood maps, extra comps, listings. My average appraisal report is now 26 pages long. AMCs are taking over, we’ve seen this when all of our lenders began to use AMCs one after the next. It’s just a matter of time before all lenders switch to the AMC model. I’d probably be better off as a Realtor and need a fraction of the education requirements. You can only whine and say it isn’t fair for so long and eventually you just give it up. Who knows, maybe another year I’ll be a home inspector or Realtor instead.
Highest and best use is mostly about the zoning. 99% of the properties appraised for a single family residence are zoned single family. Some are zoned two family and some are zoned commercial. Usually the ones that are zoned two family allow either a two flat or single family residence. The ones that require additional analysis to see what use is more feasible and maximally productive, are those which zoning allows multiple uses or zoning doesn’t allow current use. In my area the zoning is very well thought out and planned. Most zoning allows a specific use. Most homes conform to zoning requirements. Highest and best use is “as is” most the time. The times that require a more in depth analysis are typically more complex properties that require more time to analyze. Those special cases require a phone call to the lender and usually result in a cancelled appraisal, or a revised scope of work.
On all of my appraisals I do a search for vacant land sales when arriving at my opinion of site value, but some markets are entirely built up with no vacant land sales or listings, and no other markets like it. For example, lakefront properties are often built up with no vacant land sales or listings and more often than not other lakes with similarities are in the same boat. Lakefront sites are often sold as improved parcels with the buyer razing the existing homes. Those are considered to be similar to land sales in my opinion as the highest and best use was to raze the existing structure to maximimize the value of the site. Therefore the razed improvements are considered to contribute little to no value. You can use the extraction method, but it is more difficult to support. In Dane County land to improvement ratio varies significantly, and assessments often do not reflect current market value.
I’m guessing the majority of appraisers who have had experience with AMCs think they are all the same. Having worked for several, I can tell you that the majority of them are terrible, with respect to stupid revision requests, unrealistic timeframes, and scope creep. Some offer low appraisal fees, or your best quote. Most use software for the reviewing process, so stay away from them unless you have a cookie cutter home, or if you like writing addenda addressing everything that the 4 pages of questions on their engagement letters covers. Most of them pay you once a month. Most of them have uneducated reviewers who don’t know what they’re doing. In general, they all want the fastest turnaround time they can get, so they will shop for appraisers based upon the due date. Fees are set by the AMC but appraisers can quote a higher fee if they can convince the AMC why. There are some who are not like the others, however, and those are the ones to work for. Not all AMCs are bad, but the majority are.
Clint, outstanding response! Thank you. I mean it
You helped make my point about the number of ‘man hours’ needed to properly complete a report. It sounds like YOU do all that is required, but have help. My contention is that The AMC model does not compensate either YOU OR your staff for all the work that is done.
By the way, I am only estimating 25% for office / staff overhead in my efforts to formulate a minimum. If you are only getting about $150 for yourself, it suggests my estimate is very low. Id seriously be interested in hearing what you think should be a more accurate percentage. It has a significant impact on my estimates. Since I only have myself in the ‘at home office’, and my other office is as close to ‘free’ as is possible my own opinions of typical multi person staffed office expense are not real accurate. I do NOT want to be wrong as to reasonable costs for this. It could undermine the entire proposal.
I’m specifically trying to calculate a truly “Reasonable” fee nationally for the one size fits all model that we KNOW AMCS and lenders will insist on. Doesn’t mean anyone will be bound by it. Its merely an effort to get it from the current UNreasonable $300 to $350 range to something that is reasonable for the easiest of assignments.
Attorneys I contacted, contend the appraisers THEY talk to claim six hours is all the normal report takes. I content it is eight to 10+ and that not less than one working day a week (or its overtime evening equivalent) is spent reading, reviewing, researching and responding to AMC revision / rebuttal /addendum requests.
The total number of ‘man” hours it takes for one appraiser or his / her staff to complete an appraisal in the detail you described (plus 1004MC and its analysis) is critical.
So far I was falling in a range of from $420 to about $650 for ‘licensed’ though “certified required” (has a higher, low end for all FHA and condos).
I really suspect that IF a benefits package equivalent to the Fed & State Appraiser employees is calculated at 25% vs 20% (very low) and office expenses are 25%”+” that the most probable “reasonable” range is going to start around $500. Possibly ranging to as high as $650 for conventional and $750 for FHA (how much are YOU charging to crawl under a house; into an attic AND to use a volt meter on every single socket in the house? They’ve changed a one half hour to an hour inspection into a four hour commercial equivalent inspection.
That conventional base fee would be for a non complex, conforming loan limit, FNMA, NON Certified appraiser doing an SFR.
FHA will necessarily be higher now. So will condos & PUDs (MUST READ THOSE ASSOCIATION DOCUMENTS, or you CANNOT KNOW the ownership interests involved!).
I am revising my projections because I included holidays, sick days and vacation days as income building days and they are not.
Clint, again outstanding response. I hope you are willing to offer an opinion on the office support costs (not necessarily dollars, but as a percentage of fees).
NEVER let anyone cite base federal pay rates per hour as those do NOT include location premiums; benefits OR costs of self employment & office overhead.
I would estimate that I get about 40% of the fee, staff gets around 20% and the rest goes towards business expenses…taxes, office supplies, software fees, MLS dues, continued education. I need a full time employee to answer phone calls and emails and do data entry. I couldn’t possibly do that on my own, while being out in the field half of the day. I work on the appraisals after inspections and at night after my daughter goes to bed. I usually put in a 10 hour day. To put this into perspective, I make roughly $25 to $30 per hour on basic single family and condo appraisals (300 to 400), and closer to $25 per hour on 2-4 unit (450) complex and FHA appraisals (500) and around $35 per hour on farms (2,000), estates (500) and other non-Fannie Mae assignments (400 to 500). I should probably increase my complex and FHA fees by another 50 bucks to make that up, but I’ve been told the lenders won’t pay more than 500. I think 550 is reasonable for an FHA assignment, considering the inspection takes about 2 hours, and any work that needs to be completed needs a cost to cure estimate. So I would say the average is closer to $25 per hour.
To summarize, it takes a morally corrupt appraiser to participate in a kickback arrangement (AMC work). If you accept AMC orders I suspect that you would also raid your child’s piggy bank when the going truly gets tough. Show me an appraiser that accepts AMC work and I will show you an appraiser with extremely weak character.
RA my friendly nemesis, once again we disagree strongly. Until very recently, I never “had” to care for anyone other than myself. That I ‘chose’ to do so is not the same thing.
Nearly all of my peer appraisers have spouses and or children or both that depend on them. “Weak character” would be one that fails to provide food, shelter and clothing for them, just because it meant swallowing their pride and working for less.
My former partner just finished putting his son through medical school. He was ALWAYS the voice of reason in our professional relationship…because in the end, he had children and a wife (as well as elderly parents) dependent on him. You have no idea how many “S-Sandwiches” he had to eat in all that time. Now we call his son “Doctor”.
My AGA Peer Review Committee Vice Chairman is both an appraiser AND an AMC owner. He’s the opne that provides me with AMC “insider” information. He too did what he had to do to feed his family; and that of his business partner. He has to operate within the very world and environment he seeks to change. They hire me for cursory, QUICK very down and dirty QC work. I do it because I too now have a family that has grown accustomed to eating daily; and to help a friend. On a very modest basis, I also think we have, or have at least tried to modestly improve the quality of work that passes before us. At least I am now seeing fewer adjustments that aren’t rounded; or that cannot remotely be supported. Fewer people claiming paired sales where none are apparent; fewer claiming M&S as a data source-with no MS access, and those claiming land value by extraction have at least been taught how to do & explain extraction.
No, RA. Those WORKING honestly at ANY legal job demonstrate the strongest moral fiber and character, not less.
PIZZO: The basis of HVCC/Dudd Frank has existed in Sicily for ages and is alive and well today. HVCC’s Chief Architect (Andrew Cuomo) happens to come from a family that hails from Sicily as well. Is it a coincidence that appraisers today are forced to kickback nearly half of their fees each month in order to keep their shops open? I’ll let you be the judge.
PIZZO = EXTORTION It is only classified as legalized extortion because banks are recipients of the extortion bonanza rather than the MOB.
You can justify participating in an extortion based business model all day long (my family is hungry) but it boils down to how ethical you are as a person. Some us would rather cut an arm off than participate in an illegal scheme; others would run around the world in search of an excuse to justify their reasoning for taking those jobs. Like I said…if you’re willing to bend your ethics to justify accepting AMC work…you would likely rob your kids piggy bank if your back was ever to the wall.
HVCC = PIZZO = EXTORTION
It’s really a simple concept folks and and straight forward as 2+2.
Bank robbers quite often use the excuse that “I had a family to feed”. Unfortunately, their defense rarely holds water in a court of law.
I’m simply asking appraisers to take a long hard look in the mirror. Appraisers who accept AMC orders ARE THE PROBLEM. They can whine about AMCs and low fees until they are blue in the face but these same people REFUSE to acknowledge that AMCs could not exist if they were not accepting the orders.
Mirrors Mirrors On Their Walls
When Will Appraisers Grow Some Balls?
Appraisers that seek to divide rather than to unite are the problem. Appraisers that offer not one shred of constructive, practical advice on how to save the profession, rather than to abandon it, are the problem.
Appraisers that would rather quit than to fight for what is right are the problem. Appraisers that are content to blog and complain without DOING SOMETHING, are the problem.
Don’t much care what those kind of EX appraisers have to say anymore.
On the other side of the coin…how is that “United Appraisers” movement working out for you guys? You’ve had 6+ years to unite so far and you’re about as close to pulling it off as I am to building a stairway to Mars.
Uniting appraisers is a pipe dream. Take it from someone who wasted 2 years of his life and several thousand dollars on that dream.
When I speak about getting the L out of the business I am speaking to appraisers who are strictly residential appraisers. That train wreck took place years ago but we are still seeing the ongoing destruction of the business. Every time a survivor of the impact pokes his head out of the wreckage something new is thrown at them. 1004MC, UAD, CU, the latest HUD cluster puck.
Mike Ford is a general certified appraiser who sits on a 3-4 legged stool rather than a 1 legged stool like most residential appraisers. I assure you that life on a 1 legged stool is far more dramatic than the cushy life that you lead. You don’t have termites (AMCs) trying to eat on your 1 wooden leg and you don’t have idiots with chainsaws swinging wildly at your stool like HUD is currently doing.
It’s a matter of perspective. Quit doing commercial work, legal work, and stick to residential only for a year. That should give you a better glimpse of the odds the residential appraiser faces today.
Yes I was a strictly a residential appraiser and by 2009. By mid 2009 it was obvious that this was no longer a sustainable business model or a business that one could engage in with dignity. I gave it odds of 500 to 1 at the time. Quixall Crossett odds, for those of you who are fans of horse racing.
*Quixall Crossett – The worst race horse in history.
For the record Mike I spent two years of my life AFTER I quit the business attempting to unite appraisers in a boycott against AMCs. A boycott IS the only means available for ending AMC abuse of appraisers. For the record I did this at my expense..creating websites, circulating petitions, etc. For the record I am certain that I am the ONLY APPRAISER IN THE US that bothered to write to every member of Congress prior to HVCC being implemented in hopes of putting an end to it.
I’ve watched at least 20 different small groups attempt to unite appraisers so they could write beautiful letters to one department or another discussing the injustice or HVCC, the injustice of a lack of fee transparency, etc. I’ve also watched those groups fade into dust as the years rolled by just as my small group did of several hundred appraisers. To say that uniting appraisers for anything is an impossibility is the understatement of the century.
Here is your residential appraiser in a nutshell Mike:
Rob them of 50% of their fees? No problem
Block their ability to collect at the door? No problem…consider it a loan.
Slap on the 1004MC for no additional fee? I thought you’d never ask.
UAD Crap? Thank God…I needed something else to fill my spare time.
The Collateral Undertaker BS? How did you know that I had a time machine and access to 36 hour days?
The lastest HUD rule changes? I always wanted to be a home inspector…especially one that works for free.
No Mike…I quit after seeing that trying to unite appraisers for ANYTHING is insane idea. Why? You may want to sit down for this answer. I came to the conclusion that appraisers would readily submit genuine rape if necessary to keep those orders coming in. I came to the conclusion that appraisers as a group have an intelligence quotient below that of a single cell organism.
What “profession” endures any of the above mandatory rape requirements without fighting back? Name one profession that has come close to enduring such abuse and was ready to have more manure shoveled onto their heads at a moments notice?
There was a time to attempt to unite appraisers (2009, 2010) and there is a time to attempt in vain to talk sense into the heads of appraisers who insist upon eating shi* for a living because they are forced to.
I can’t say I disagree with retired appraisers opinion. sorry RA that you invested those $s and time on trying to unite residential appraisers. I could have advised you, to not waste your time and $s. Many have tried to achieve that unifying goal and none, to date, have achieve it. This lack of unity is just one reason why lenders/amc and non-appraisal entities keep pouring on the demands and requirements. They can pour it on, without an significant push back from lending appraisers. Lenders have always know that there is a segment of lending appraisers that will always “jump through their hoops” regardless of how unreasonable their demands. Its been that way for decades. However. it been worse during the past 10-15 years.
Brand new appraisal opportunities have arisen, due to these variety changes. Some amc’s have burnt so many bridges, they really don’t have the ability to place orders efficiently. So sign up with all of them, and then bid everything standard very high. If the game is substitutability in assignment process, appraisers can play that game too, only much better than regular process clerks can.
RA thanks for the reasoned response.
Re: three legged stool; to some extent that is true, BUT companies like PCV Murcor ALSO do commercial AMC work and have done the same thing to commercial rates that all the AMCs have done for SFR rates.
What I used to get $4,500 for is at best $3,500 today because I have to compete with their fees. What I used to easily get $7,500 to $10K for is extremely rare. Three quotes of from $25,000 to $50,000 this year never turned into anything-as is USUALLY the case. They (PCV) typically charge $1,500 to $3,500 with the usual cap around $2,500. Appraiser only gets half, but they DO pull CoStar Comps and give them to the appraiser. Those comps have varying degrees of relevance. Their review Department (one man that Im aware of) is outstanding. They DO press for under two week turn times and it gets “dicey” asking for more no matter how justified. There are other issues as well, but that gets into potentially litigious territory that I don’t want to go into now.
In ’08 90% of my work was SFR and review of SFR (including 2-4s). Its necessary in a one person business to even out cash flow. I do NOT do one week turn around for commercial jobs. Interim SFR to 2-4 unit work is and always has been critical.
RA- We’ve joked about herding cats before. Its true. MOST appraisers are not joiners outside of their own professional associations. Frankly MOST don’t even join those. MOST appraisers in my experience would rather let someone else do the fighting. THAT is WHY we are where we are today!
MANY have tried to organize us, and just like regular businesses; most have failed. There are 19 to 21 Professional Coalitions in the Country. Louisiana; North Carolina and Virginia appear to be accomplishing modest but significant objectives. I’m not convinced Texas and Illinois are independent appraiser groups so much as extensions of the AI, but I could CERTAINLY be wrong about them. Arizona is a mystery of complicated inter-organizational intrigue and may or may not be imploding. Certainly there does not appear to be a single organization speaking for all appraisers there.
My own state’s coalition recently did yeomen’s work on AB624, but I believe if something ever happened to Its President or its original co founder; it could collapse. THAT is shameful in such a populated state! That’s why I continue to promote CCAP (or CaCap as its now referring to itself) almost as much as I do AGA.
I have NO IDEA how effective the remaining 13 to 15 coalitions are.
States NEED effective state groups, but ALL appraisers need an effective NATIONAL Group.
Look up my UNPAID VOLUNTEER Guild President’s background on LinkedIn and other sources (Peter Vidi). Particularly his legislative experiences. He is an appraiser; a broker, a title company AND our Guild leader. He KNOWS how to move in Washington; and the Guild knows how to move around in the States (like it did with the California Labor Federation). I’m not a complete stranger on local level politics either. I’m also an unpaid volunteer.
So, for the same reasons YOU outlined RA, I sought out a union. It does not have to reinvent the wheel and learn how to ‘fight city hall’. They already know HOW to do that AND they have the infrastructure in place.
What they DO require is for appraisers to join and demonstrate that it is in the unions interest to adopt the ‘Professional Guild’ of independents as their future business model. A “new” union model. One that works WITH business when possible, and makes no asinine, unreasonable demands just to look like they are ‘doing something’ for the members; but that is unafraid to fight when business is operating in the shadows and unfairly.
This will surprise some, but I have been critical of my parent unions national ‘message’ and blind ‘obedience’ to the DNC. You think its hard to herd appraisers? Try convincing a powerful union that ‘Labors’ BEST chance for the future lies with Centrists; Independents and even Republicans since these folks PROMOTE business rather than suppress it.
Think it can’t be done? Read about SCIG at http://www.mfford.blogspot.com or BNSF. BIG Business AND LABOR joined together to fight pseudo-environmentalists, and self serving professional NIMBYs. (Note: Im not anti environment-I’m just anti racist LIARS and I’ve said THAT in public too). If I were anti environment, I would not be listed in the AIs Green registry (non member section).
So far the unions have not thrown me under the bus. Just the opposite. When I called for help in California, THEY (OPEIU/AFL-CIO) responded. They did it quickly, effectively and unconditionally.
RA- WE are DOING things. We are routinely defending appraisers already. We are standing behind OUR other supporters. Not a week goes by that either I or one of the other Chapter Leaders don’t have to get involved in some new appraisers problems.
So, once again, I urge ALL to contact Jan Bellas at Janbellas@aprpaisersguild.org and join us. We certainly need YOUR help! ALL of you. Republicans, Democrats, Libertarians, Independents, TEA Party, Conservative, Liberal and Progressive, Greens-everyone. All I care about is whether you are appraisers and interested in bettering OUR lot.
PS- While a boycott WOULD have worked, they also require ORGANIZED participation. A boycott with no organized follow up plan would have been undone fairly easily. Besides to many of the cats either opposed a boycott or saw it as THEIR opportunity to make money.
Have you ever considered a class action lawsuit against AMCs’ for the difference in fees reported to the consumer and what appraisers actually receive? The banks and AMCs’ have misrepresented themselves for years now. The amount of the accumulated difference enjoyed by the AMC’s to date by reporting it as an appraisal fee could be a huge settlement. Seems logical. .
After reading all these comments I can’t understand how any of you have enough time to get any work done.
There are several problems with the AMC model and the reason they still exist is that the appraisers will not stand together and change the system. I conduct meeting of appraisers in this area each month and we discuss many of these issues. Most appraisers have no choice except to work with AMCs if they want to survive. AMCs control over 70% of all the appraisal assignment. All appraisers need to analyze their cost and charge fees that are appropriate for their experience, knowledge , training and the time, this includes all expenses. If you are making $35 to $45 /hr you need to get out of the business and go work for someone else. My average fee for a “Cookie Cutter” track home in a subdivision is $ 550 and it should be higher. Some of my fees for reports for SFR have been as high as $800 and custom homes can be over $1,000.
Appraisers need to learn to manage the AMCs not let the AMCs manage them. I have a “Black List” of AMC which I do not work for. You should never let an AMC tell you what you can or can’t put into your appraisal report. They are not an “Intended User” of the report. You should never put an AIR statement in your report. AIR statements are HUD & Fannie requirements on the Lenders dealings with the appraiser, not on the Appraiser. If you put an AIR statement in your report, you the appraiser are certifying that the Lender has not violated their requirements to fannie or HUD, do you really want to do that? Read the complete AIR, would you swear in court that the lender/AMC has not violated any of those requirement?
If the AMC reviews the appraisal report they should forward their review along with your completed report to the Lender, not send it back to the appraiser for changes. Only the Lender should be able to make revision requests to the appraiser. Several times I have told the AMC to send my completed report to the Lender and very few times have I received anything back from the lender. Make appraisal reports that meet the Lenders requirements not the AMC’s.
TRID is going to be a nightmare for the appraisers fees, the AMCs are going to use this as a lever to keep the appraisal fee low. The appraisers need to stand up not let this happen.
All appraisers should go vacation as of 10-1-15 for 3 week or a month and when they come back to work the minimum fee should be $750.
There are dozens of other issues I could discuss but I have to do an appraisal to cover my golf fees.
John, lots of good suggestions.
MY list of AMCs I work for is far shorter and easier to maintain. It has ONE on it. I liked your suggestion about managing AMCs.
Twenty years ago I paid trainees including newly licensed appraisers a minimum of $25 an hour. That assumed eight hours per report. No highly experienced appraiser (say ten years or more) should (in my opinion) be working for less than $65 to $75 an hour today-even for production loan work.
Frankly my daily goal is $125 an hour for a full eight hour day. I don’t always (or even usually) hit it with residential work-but it is the goal. By shooting for this goal, sometimes I DO hit it. IF I were to shoot for $35 an hour I would never hit any higher.
Now I cannot afford to pay a trainee $25 an hour. Why? Because I cannot charge enough to warrant taking out four hours of MY day to hold their hands during inspections; plus the time it takes to review and recommend revisions to their when done in the next day or so. Anyway, I digressed.
If you are holding monthly meetings with other appraisers, then I’d encourage you to share your views about fees with them. I agree with your personal current fee structure. I think when TURD becomes effective; or FHA new guidelines, then the minimum will have to be in the $650 to $750 range for non complex work.
Those that work 10 to 12 hours a day and claim to do two appraisals a day need to stop that kind of “bragging”. Its unsustainable and more importantly, not a realistic indicator for top quality appraisal work performed by ONE individual. Those using staff to achieve the same goal (or more) need to estimate TOTAL man hours involved and staff overhead in any discussions of fees.
A normal or reasonable work week is 40 hours. IF one charges $500 for an SFR, then that same SFR on a weekend to accommodate a client or owner is $750.
As for time…some people golf. Others post to blogs. More realistically, refusing most AMC work DOES result in more free time if one wants it. So does Appraisal Union work. I cheerfully accept the trade off.
Clint thank you! Longer reply got lost in Ethernet somewhere. Sorry.
Hey there Wayne, great article. Nice one. Thank you.
Personal post-not affiliated with any group but myself despite avatar
“[sent by MFord 9/28/15 n response to below]
My previous remarks still stand. Ask each of these “so sure of themselves advocates” whether they wish me to send copies of your sales pitch; comments attributed to them, and my responses to the Texas Appraiser Licensing and Certification Board (TALCB) so they can explain their techniques to them; and / or to The Appraisal Foundation so they are aware of the kinds of marketing and representations that are ostensibly being made by their sponsors.
I listened to the ZAIO hustle of a few years ago; see or hear new software hucksters promoting magical fairy dust driven software that if believed all but eliminates the need for me on a near daily basis, and stopped believing in unicorns And magic lamps long ago.
I’m not interested Mark, but I’ll pass your kind offers on to the appraisal world that I can, on your behalf.
“From: Mark Sammis email@example.com
Sent: Monday, September 28, 2015 10:17 AM
To: Mike Ford; firstname.lastname@example.org
Subject: Mike, meet the experts. Mark.
If you would like to learn our Houston office’s system please call Mark Verrett: Accurity Acorn Appraisals 832-326-9149
Here is what our Chief Appraiser, Tom Munizzo said about Mark’s system: (Tom is a former NAIFA President and a current member on the Appraisal Foundation Board of Trustees. He just wrote the course on NEW FHA Requirements for NAIFA)
I just spoke with Tom, and I quote:
Technology is changing the industry.
Data Analytics, Cloud based Development.
600 decisions are needed for one appraisal, they don’t all have to be made by the appraiser.
The Commercial Model: Any MAI doesn’t do it all.
6 hour do it yourself appraisals and people that do them are a dying breed, 10 years tops.
Our 1 hour appraisals are more credible and significantly better.
If you would like to go through our process and meet Tom please let me know.
National Sales Manager
8777 E Via De Ventura Dr.
Scottsdale, AZ 85258
From: Mike Ford email@example.com
Sent: Friday, September 25, 2015 12:19 PM
Cc: Mark Sammis
Subject: FW: Mike, Webinar Efficiency Workflow. Mark.
We spoke about Accurity the other day. I was unsure before, but all doubt has been eliminated now.
See claims. Top producer is doing 74 a month without overtime. That’s 3.7 a day!
I think I’d prefer to keep my license instead.
From: Mike Ford firstname.lastname@example.org
Sent: Friday, September 25, 2015 12:13 PM
To: ‘Accurity Valuation’
Subject: RE: Mike, Webinar Efficiency Workflow. Mark.
I am not interested in any firm that thinks or claims or pretends to be able to “complete” a USPAP compliant real estate appraisal in one hour.
Think about his or your claim for a minute. An office may do 74 appraisals in a month, but unless you are talking about appraiser assisted AVMs, NO ONE (single appraiser) can do 74 USPAP compliant appraisals in a single month. Tell them for me that I personally am calling them liars if they make that claim. I don’t waste my time listening to liars.
From: Accurity Valuation email@example.com
Sent: Friday, September 25, 2015 8:49 AM
Subject: MIke, Webinar Efficiency Workflow. Mark.
If you would like to watch the Accurity Webinar you missed this morning on Efficiency Workflow please let me know.
The host was the owner of our Houston office: Accurity Acorn Appraisal
1. He illustrated how to do an appraisal in 1 hour that usually takes 4 hours.
2. His top appraiser completed 74 appraisals last month without working overtime.
3. Members were asking great questions on how to implement his system, you should hear the answers.
Enjoy a 3 minute video from our CEO on our website to learn how Accurity can benefit your business:
http://www.accurityvalution.com. Click on “Why Accurity”
To Your Success with our Support, Mark.
National Sales Manager
8777 E Via De Ventura Dr.
Scottsdale, AZ 85258
If you no longer wish to receive communications from Accurity simply email unsubscribe@AccurityValuation.com
Now THERE’s your ‘special’ appraisers!
Colorado-absolutely agree re prices.
My new basis for all quotes:
http://mfford.com/html/c___r_fees.htm PS-sorry about spacing above.