Appraiserville – Fake Claim of An Appraisal Shortage
Please provide feedback immediately to “two banking institutions have requested that the Appraisal Subcommittee temporarily waive the requirement for use of state licensed or certified appraisers” based on the fake claim of an appraisal shortage. I wrote about Tristar Bank in Appraiserville a few weeks ago. It is worth re-visiting since I translate the Tristar request into my interpretation of what they are really saying.
It is recommended to send your responses ASAP to firstname.lastname@example.org rather than to Jim Park directly although either way is fine.
The Appraisal Foundation will be responding to this issue. Here is an email I just received on this issue:
Dear Council Members:
We wanted you to be aware that two banking institutions have requested that the Appraisal Subcommittee temporarily waive the requirement for use of state licensed or certified appraisers as authorized under Title XI. For background information and copies of the letters, please visit: https://www.asc.gov/Temporary-Waiver-Requests/TWAP.aspx
The ASC is encouraging input from the appraiser community as they consider these requests. As the first request came from a bank in the metropolitan Nashville area, an area with a large number of appraisers, an approval would certainly create a ripple effect across the country. Please submit your comments to:
1401 H Street, Suite 760
Washington, DC 20005
The Appraisal Foundation intends to provide comment and will provide you with a copy of our letter. Thank you for your attention to this critical matter.
David S. Bunton
The Appraisal Foundation
direct phone 202.624.3040
Please take a few minutes and respond to this critical issue. Read more »
- What Does Seat Time Serve? - December 5, 2022
- AI Showed this Video and Anger Ensued - November 7, 2022
- Lowballed… It Is Open Season On Appraisers - October 24, 2022
The most recent Fannie Mae Appraiser Newsletter indicates that there was/is no shortage.
The ASC must request data from FNMA’s CU system, to know for certain. This should be part of the standard process if considering waivers. FNMA after all, did create the biggest data system to date regarding mortgage lending origination appraisals and appraisers. If ASC can not access the CU, they’re not adequately informed.
The most recent (ie: 2nd Appraiser specific newsletter) from Fannie Mae
There is NO shortage of appraisers where I work in Central California (Fresno to Merced) and the Central California Coast (Monterey County). Most appraisers I know refuse to work for AMC’s. AMC’s continue to try and pay the appraisers less, add more fee’s (portal fee’s, transaction fee’s, etc) and send our work back with ridiculous and unwarranted revision requests.
Also in central California. I agree Scott, we will not accept below market fees. These AMC’s just play a numbers game, lowest fee, fastest turn time wins…. Good luck with finding quality work.
There are now some areas that no appraisers exist anymore as mentors and there are no apprentices standing in line. There needs to be coverage of some kind of valuation product to be used where that are no appraisers in that geographic region.
Kevin, specifically what areas do you speak of my friend? What counties and in what states? Are the numbers on your map the number of appraisers in those specific countys ? If so, looks like quite a few appraisers are available. I’m sure they would cross county lines for work that is if they were compensated fairly.
Kevin, when lenders have adapted both short and long term policies where professional appraisers are treated unprofessionally, why should the American tax payer be the financial backstop to even higher risk loans (no appraisal / waiver issued)? Why should lenders be rewarded for bad behavior? Go back and read the court documents relating to Washington Mutual / eAppraiseIT, LLC, where good appraisers were blacklisted for being independent thinkers. Go back and read the 10,000+ signature strong appraiser petition around the time of HVCC, and tell me if any of those concerns have been seriously addressed? And last but not least, how can a 5, 10, or 30 day appraisal assignment hold up a loan process that statistically takes 40+ days to complete?
Seek the truth.
If there ‘needs’ to be some labor service, it is up to the requester of that labor service to provide sufficient and compelling compensation to bring in the help. This particular area seems to have driven out the appraiser staff. Time for lenders to pay up and incentivize the problem. I’m ready to move there, all I need is relocation compensation above and beyond what I get here. Those lenders will have to do the unthinkable, they’ll have to finally start treating appraisers fairly and promote their businesses rather than driving them out of business.
Mr. Klosterman is not a licensed appraiser in Ohio currently. Expired in 2008, so the question is whose interests is he promoting?
Very interesting information. yes, what exactly is he pushing for? His reply. if he does, should also be interesting.
I sure would like to know how many appraisers in the areas were these banks are located ask to be placed on the appraisal panels of these banks. I’d like to get an unbiased response regarding this directly from the presidents of the coalition’s in those states and / or the appraisal Institute. Hello …… ? Any body out there ? My sources say that many appraisers reached out to these banks to ” lend a helping hand ” and help these poor banks out of this “situation.” Once received, these numbers should be forwarded to Mr. Parks. I heard that the AMC that one of these banks use on a regular basis had no clue that this was going on. Weird to be on the same side as an AMC !
Look at the Ohio map I attached and then look at Holmes County. Their one 85 year old hand written appraiser, just retired.
So none of the 78 appraisers in Stark County would go to Holmes county ?
Kevin’s AMC appraiser pool is too limited. Kevin should fight for the elimination of the AMC model. The AMCs are the true reason why there is an appearance of an appraiser shortage. His map is misleading also. I live in Delaware county but appraise in 8 counties.
That was all the licensed appraisers and came directly from the State of Ohio not me and was given out to help fix the problem the banks are having finding appraisers not instigate a conversation on the misuse of AMCs. My role is to fix their valuation needs and currently no appraisers are willing to drive that far or they would already be using them.
Hello Kevin, From my point of view it is the AMCs that ARE the banks problem. If a bank wants to hire me I am available. If that same bank wants their AMC to hire me I am not available. It does not matter if the property is located across the street from me. I am not the only appraiser that feels this way. To HELL with any AMC. Maybe this will help explain the perceived appraiser shortage.
Here Kevin. Here are 11 appraisers for Holmes county.
Good job Seneca. Considering the county of Holmes Ohio only has a population of just over 40,000, the 11 noted appraisers serving that county represents a 1 to 3,636 resident to appraiser ratio. My county of coverage (San Diego) has 3.3 million people and 954 appraisers or a ratio of 1 to 3,459 (not including outside county coverage). Based on your logic, and with a similar ratio, is the county of San Diego underserved? With 954 appraisers in a single county, with your logic does this reflect an appraiser shortage?
Seek the truth.
That is old data. The State DoC gave out those maps to those who attended the Appraisal Institute Economic Conference last month based on who lives in that county. The point is, there are no mentors and there are no more appraisers getting into the field or moving to certain rural areas. Whether it is the perceived fees, volume, HVCC or AMCs there is a problem as the banks will still need their valuations and although I agree there may not be a shortage of appraisers, they are not all in the right places and that is a problem that still needs addressed.
Kevin, even if you have a problem today in Holmes County, what efforts were specifically done years ago to prevent the current situation? Did you know there was as you say, one 85 year old appraiser living in the county? Did you put ads in the paper / radio, and recruit with incentives to attract outside candidates? Did you start at the time a local, regional, or national discussion relating to the topic (appraisal related)? Were you aware that Holmes County Ohio has the worlds largest Amish community, and perhaps has special circumstances surrounding its housing market? If the local bank needed a new qualified manager, they would keep raising the incentives (moving expenses, bonuses, housing assistance, etc.), to find a candidate, but when it comes to appraisers, very little is done to recruit and obtain their panel.
Seek the truth.
I work with many of Ohio’s banks and not one specifically. I also work with the regulators and educators on how to fix some of these and other banking problems. I used Holmes as it one of the several epicenters these groups are watching closely to see what happens. If fixing these coverage problems is merely suggesting that appraisers are going to quickly pour in and fix these low density low volume areas where there are no appraisers now or in the near future, we should be concerned and looking at more realistic solutions. I’m sorry I piped up here looking for some ideas or suggestions on these matters.
Kevin, your bank clients have absolutely no problem that money will not solve. I bet there are a whole bunch of appraisers that will come to Ohio and prepare appraisals for your banks for the right fee. I also bet that there are none that will travel there to work for an AMC for chump change. Money talks and BS walks. Put some incentives and some decent pay into your effort and I think you will solve your problem quickly. Example: A local mining company has to stop their truck if the window glass gets chipped. This company has a contract with a local glass company to have someone there within two hours to repair the glass. These glass folks will have someone there within 2 hours no matter what day or time of the day throughout the year. Guess what? the price of that service is not cheap! However, problem solved!
Kevin appraisers from out of area are not going to ‘pour in ‘ anywhere, Use of that term, suggests you may already have some biases.
Appraisers aren’t going to rush to serve areas that will take them much longer, for current low fees. It takes me much longer to achieve market competency in Pennsylvania than it does in Los Angeles. My fees reflect that.
Long term solution? Easy. Get TAF the hell out of the process! You have non real estate appraisers currently voting on standards and qualification requirements. THAT is wrong! Let appraisers decide who, what, where and and when trainees are qualified. Banks want to use BPOS where agent’s teenage kids can inspect property but I cannot send a qualified trainee that I have determinded can be trusted enough for me to sign behind?
Like I said, get TAF completely the hell out of the process unless and until they segregate real estate issues 100% from ALL other issues. Quit trying to make USPAP fit all disciplines.
As far as Im concerned TAF MET their FIRREA mandate long ago. Everything since then is just ‘making busy work’ to justify their existence; and to accommodate special interests.
Kevin by ‘working with many banks and regulators’ do you mean as an AMC employee?
You haven’t been a licensed appraiser since 2008 so I question whether you are qualified to opine about anything from an appraisers perspective anymore.
First Name :
Middle Initial :
Last Name :
Name Suffix (Jr, Sr, etc.) :
Company Name :
Street Address :
5885 Dublin Rd
Zip Code :
Telephone Number :
State Credential Number :
Credential Certificate Type :
Effective Date of Credential :
Expiration Date of Credential :
I will give Kevin at least one benefit of the doubt, Holmes county has a very heavy Amish population. Amish don’t list with MLS and most sell between each other. The Amish value of the organic soil they developed is a different value than to the general public’s idea of value. But at the end of the day the Amish still need financing. In these busy times most appraisers will turn this work down because it’s boot work. It is a niche.
Its called R e c i p r o c i t y. Im told Oklahoma is resistant and difficult…as are local brokers trying to protect local turf. Oklahomans don’t need PIWs. They need existing laws intent followed. Encourage reciprocal arrangements with appraisers willing to go to the area once or twice a year when needed..
That’s untrue. The banks own letter indicated they have Texas and Kansas appraisers that ARE willing to drive that far.
Maybe appraisers would be willing to drive, if the fee was fair compensation for the time, travel and research involved and they didn’t get nickel and dimed to death with stupid questions and stips.
Correction, no appraisers are willing to drive that far, for the inadequate compensation offered. Pay me, I’ll drive there.
Kevin you are perpetuating a false narrative. Several in fact.
1. There is no shortage per your own map. My understandings is appraiser licenses in Ohio are valid statewide and those counties are not particularly large inland area.
2. Trainees just waiting in line for mentors? Fine. Then let the states AND TAF change the rules concerning both the number of appraisers that can be mentored; and the certification requirement for training others for work credit. Micro management and overall disrespect for the skill and experience of licensed level appraisers is what has lead to a decline in mentors for trainees.
3. Your statement “My role is to fix their valuation needs and currently no appraisers are willing to drive that far or they would already be using them” is simply dishonest. Pay a fair fee and offer attractive working conditions (absent all the usual AMC BS) for appraisers and you will be inundated with people willing to work for your mysterious “they”…Unless of course ‘they’ don’t pay their bills on time.
AGA has already written ASC on the alleged Tennessee and Oklahoma shortage issues..
Mr, Ford, I’m surprised at your rather tacky comments and how you continue try to attack someone who is or at least was actually in your corner. I am not an appraiser anymore, I am not an AMC and I don’t order appraisals for any of our banks. I have concerns over geographic competency sending an appraiser across the state for any amount of fee not matter how big or small it may be as I don’t see that as a solution bank examiners would like to see either. We did find an appraiser that helped cover the one bank that needed help and I’ve moved on so I would hope you can too.
Kevin, you’ll have to be more specific. Which ‘tacky’ comments are you referring to?
Are you are unfamiliar with traditional, sound, generally accepted appraiser practices dealing with competency? Before the era of Big Data we all used to visit and consult with local area agents to assure we were aware of specific sub market area nuances. Some of us still do.
I don’t know of any state in the USA where appraisers only work in their home counties. Not even Texas or Alaska. Generally there is simply not enough work at any one given time to keep all appraisers busy in only the county they reside in. Not even San Bernardino County, CA (check size).
Then again, most appraisers already know this.
Lastly, Kevin we all like people to agree with us or to be ‘in our corner’. It’s human nature. My preference is to build bridges rather than destroy them. Having said that, when people are being deliberately deceptive in their efforts to push a false narrative, then I am much less concerned with whether they are ‘in my corner’ or not.
Kevin, I accepted long ago that not everyone is going to like me. For a lot of reasons. That’s okay. I’m an appraiser. I’m also a Republican that happens to be a union organizer. It comes with the territory.
Damn! Just accused you of not being an appraiser in another post. My mistake. I apologize… though what you were posting sure made ya sound like an AMC rep. If I can remember the thread I’ll self correct there too.
Kevin, you do realize that appraisers are state licensed, and not county licensed right? Considering Holmes County Ohio only has 423 square miles of land area, what do think Southern California appraisers would tell you when many cover the county of San Bernardino which has 20,105 square miles of land area? Also, what recruitment efforts were done 15, 10, or even 5 years ago to get ahead of the curve? Hiring a discount AMC to send out blast e-mails to have appraisers sign up on a panel, should not be considered active recruitment.
Seek the truth.
Any excuse not to use licensed or certified appraiser. Bah humbug
My county of practice (San Diego County), contains nearly 900 appraisers per my last count, where in essence, one in ten of ALL APPRAISERS reside. Regardless of population (top 5 county), I/we compete against more appraisers (+/- 30 miles) than what many entire states reflect for appraiser licenses. If your looking for a shoulder to cry on, stay away from Southern California.
BREA shows 954 active appraisers in San Diego County. Fresno County shows 200. Definitely no shortage that I can see! We just won’t work for 1985 wages and accept the ridiculous revision requests from AMC’s.
Not to get off subject but I believe AMC’s are the cause of any real or perceived appraiser shortage. The original concept of the AMC was not a bad idea. I have been an appraiser since 2006. Prior to that I was a VP in the banking world. One of my jobs was to hire appraisers. Instead of me (the lender) having to qualify 10 or 20 (or more) appraisers and keep their records up to date year after year, if I…… as the representative of the bank could make one request and hire a qualified, impartial appraiser, that sounds good. But of course the AMC has to be paid. Then…year after year the AMC’s keep increasing their fee and inventing new ones. Portal / maintenance / transaction / technology fee (they all have their own special name for their a la carte fee’s). There seems to be a “push back” around $350 to $500 where most AMC’s refuse to pay most appraiser’s more (even though the AMC might be receiving $350 to $500 or more for just connecting the appraiser to the lender). Then AMC’s started telling the appraisers how to do their job, how to complete the actual appraisal report. The AMC sends the appraisal report back to the appraiser for (free) revisions. Far more often than not the revisions are nothing more than fantasy. It is the AMC flexing its muscle and trying to show the lender some unqualified worth. I sincerely believe there is no shortage of appraisers in the USA. The AMC’s are the problem. They have become too powerful and too controlling over appraisers. Try to imagine attorney’s or accountant’s being selected through an AMC.
AMCs AND banks are the problem. Both have ‘fixed’ the appraisers fee at the time the loan disclosure (GFE and TRID) are signed. Well before the appraisal is ordered.
It appears AMC’s are trying to solve the problem/Flex the muscle as you say and trying to become too powerful. Just look on any internet job search engine. It appears a lot of the larger AMC’s are starting to hire their own staff appraisers as well as trainee appraisers across the country. So they are now becoming large nationwide appraisal shops.
Johnathon, the American Guild of Appraisers responded to this already opposing the Tennessee waiver.
The Oklahoma waiver is also opposed – though for different reasons. Guymon, OK is a community of about 28,000 people. The area is largely rural / agricultural. I’ve also spoken with Mr. Park on the issue.
The bank involved simply doesn’t like one of the (2 to 3 depending on who you believe) ‘local’ appraisers and is making a big deal about having to get appraisers from Kansas of Texas to drive up or down to the Panhandle; OR their borrowers have to wait more than 4 weeks for their appraisals. THIS is why we have reciprocity!
Due to the shape of the area, both the Kansas and Texas appraisers are closer than any from central state would be. IF they are having a temporary local shortage then the solution is not a waiver that puts taxpayers at risk yet again.
The solution is for the Oklahoma Board to adopt reasonable, less cumbersome reciprocal agreements.
A town of 28,000 residents should not set national appraisal policies. As fellow Americans, Im concerned about them being fairly treated, but not when the whole incident is a chimera for something else.
Does a town with a 28K population really have so much commercial appraisal work that 2 or 3 local appraisers cant keep up with it? Really? These waivers don’t just apply to C&I work. Once granted, they cover all C&I AND residential 1-4 units as well. Its just usually easier for the liars advocating the waivers to show fewer general appraisers in a given area than it would be to show a residential appraiser shortage.
What they are trying to do is eliminate ALL appraisals in the entire Oklahoma Panhandle… and beyond.
If that’s the case, then let them make portfolio loans and only risk their own investors money – not taxpayers.
Mike, Just like the old Paul Harvey broadcasts “Now for the rest of the story”! I know small towns as I work in that type of area. I will bet my extra clipboard that at some point in the past there were officers at this particular Oklahoma bank that insulted, cheated, mistreated, etc. these two or three local appraisers. These appraisers being human told the bank employees to take a hike and that is why the bank has no appraisers willing to work with them!
In a town with a population of 28,000+/- you will typically find only 2 -3 appraisers and that is normally enough. I have witnessed the situation where the small, local bank puts a secretary “over” the appraisal department. I remember one of these ladies having called me. It took me a couple of hours to return her call as I was out in the field. She informed me that when SHE calls she expects me to return her call immediately!
Reminds me of the story of the round tuit.
I only return calls immediately if I have round tuits. If I don’t have any round tuits, they will simply have to wait until I get around to it.
In any case, I question whether a community of only 28,000 to 30,000+- can support two or three appraisers. You’d have to tell us – I’m only guessing. If it can, then perhaps the bank should hire some full time appraisers so they can avoid such delays or periodic shortages.
To ALL… When exactly did FIRREA or any other protective regulators promise that service is expected to be provided within a week or two? For whatever reason, these folks CHOSE to live in the boonies. There is always trade off.
I’ve broken down in or around Winslow, Arizona several times over the past 50 years. Nice people there, but they don’t always have the car parts I need because the local demand doesn’t support stocking them. I have to WAIT until they get them by UPS – sometimes a couple day delay. Rural America enjoys a quality of life many of us can only envy. Part of that desirable isolation means things take longer. That’s not necessarily a bad thing.
Maybe he’s right, there is a shortage of GOOD appraisers. because of all the BS that GOOD appraisers are unwilling to put up with after years of experience. Only the bottom feeders are left who will work for the scraps thrown out to them by most AMC’s. Very sad.
How can this occupation continue to work for scraps? I took my 4 yr. old grandson to the movie yesterday. I purchased admission with the senior citizen discount and he got the child price. I could still have gotten a ribeye at Outback for less! What really got my attention was that I bought him the very smallest fountain coke and a 7oz package of Lifesaver gummies for a total of $11.13.
Our appraisal fees for a conventional 1004 with silly MC form begins at $450.00. A final inspection fee is $150.00 except for VA where it is only $100.00. However VA fee starts at $475.00. We have plenty of work and turn down a couple each week. Would someone explain to me how these appraisers survive doing assignments for AMCs at $350.00 and below. Also, why in the world would they want to?
Go ask the head appraisal cheerleader in Idaho. Its easy to be in the office one time a week, review and signs 4 to 9 appraisals a day, thus inspect 4 to 9 properties per day, drive by and photograph say 25 to 50 properties a day, work your state and others, go to expos, pedal coaching material, and the latest to provide appraisal bids primarily on gut feeling. Apparently with an Uber driver, a pocket watch, a Texas Instruments TI-84, a couple of matches, survival gear in your trunk, and your trusty Disto D2, anyone can do it.
Bill, is that the same gentleman that posted a video saying that for an AMC he reduced his fee from $350 to $325. for volume? I suppose based on this market strategy you could eventually get all the assignments and be doing them all for free?
That Expo you mentioned…Is that where you pay a bunch of money to go somewhere like Las Vegas to hear AMC folks and others that have never done an appraisal explain to you how you should do appraisals? Is that where appraisers are taught how to work harder for less money? I think I have heard about it!
Because there are no restrictions regarding providing assignment companies a thing of value to be the preferred selectee, amc or direct, it does not matter, it’s easy to move to the front of the pack. The appraiser simply discounts, the distributor of the order request does not return cost savings to consumers, simply pocketing the difference instead, a wink is exchanged, the distributor staff is funded for another day, and that appraiser gets the lions share of work. That’s such a popular approach, appraisers have whole seminars on how to do it and amc’s so much as advertise this is one of their core operational methods. It’s how most lenders fund their ‘direct’ assignment programs, and outsourced direct where they still outsource but bypass amc requirements. One ponders how many appraisers such monopolistic approach methods drove out of business but the number is likely to be over 130,000 people in around 10 years. Those who claim the main focus of appraisers should be strictly profit focused in a highly competitive setting are dangers to the professional goals of maintaining the public trust and cause more harm to more people than their nifty profit first approaches ever have helped. Hey, gamblers and loan sharks are often drawn to vegas, it’s been that way for a long time. If the expo people gave a hoot, they would move the venu yearly to support smaller local communities who actually need help and revitalization of the real estate community.
That’s the easy way. The hard way is to refuse engagements unless the client confirms there is a consistent minimum fee standard, not allowing appraisers to undercut each other in such a manner. If someone needs a raise, or the operational budget gets slim, even the direct companies simply chop the standard fee down a little to cover the difference. The old timers warned us pre hvcc this would happen, that once it was allowable to dip into the appraisers fee by non appraisers, there would be no end to it. Forcing appraiser license requirements on ALL distribution workers should help clean up this ethical quagmire, such activity would not be ethical for a licensed appraiser to engage in. The lower your fee the higher my commission but I promise, that’s not a ‘contingency arrangement’. Seneca, you may be ethics deaf, your income is not justification for engaging in such egregious ethical violations during the order distribution process. 5 a week, by yourself? see addenda and outsourcing I suppose, weak.
“engaging in such egregious ethical violations during the order distribution process.” Really? You have no idea what you are talking about. So you’re saying you can’t complete an appraisal a day? Especially now you don’t have to go to the county courthouse, Then drive to the zoning office, then to the engineers office. Then to the realtor’s office. Your assuming is egregious.
It’s called providing a thing of value to be the preferred selectee. The management rule. If cost savings are not returned to consumers, appraisers who discount to get ahead of others have provided a thing of value to the distributor (arguably being party to help them defraud consumers). The differences between working with companies with set fees, vs companies who shop.
I can complete a weak appraisal a day, but the more you know, the better you get, the longer it takes. Quality first. High quality detail and using no short cuts maxes me out at 3 a week in around 50 hours. Price is not value and speed does not equal quality. Do I know what I’m talking about yet?
Oh, Just stop it. No one on the planet needs 15 hours per appraisal. If you do then you are not an expert in your market. You are slowly losing creditability with every post. Or you’ve had too much Scotch.
Don’t take it personally please. Liability risk keeps climbing and I just went 10 years without a single complaint. They call me first because I’m better, not because I’m quicker.
Where to begin…
Seneca overhead in any appraisal office is usually closer to 25% to as high as 50%. Up until a month or two ago I had Alamode; ACI; Bradford, Narrative1, & BizPricer platform software (iit averrages around $200 month).
E&O is usually around $800 ($67 avg) when I carry it. Paper and ink run about $100 a month (staples, pins, etc.); gas-minimum of $100 month if Im NOT busy and up to around $400 if I am.
My home office is 15% of my house. My mortgage is $2,200×0.15 =$330 PLUS pro rata share of utilities. I cut back phone and internet service bundles but still pay over $100 a month.
License renewals; CE every 2 years and optional coursework simply because I WANT to learn? At least another $100 a month. MLS Service? About $30 a month. NAR / CAR fees? $75 (includes designations),
CoStar Comps 5 zone (OK I learned how to side step this but have to be prepared at any moment to restart it) at $1,000 a month on average (assuming they are still at $2,500 per zone x 5 for L.A.);
land line? Car payment and insurance? (All five clunkers are paid for but repairs on average are another $250 a month…when I can afford them-which is why I wound up having to get 5 cars to begin with); OK so you think its a 6 figure income? (450 x 5 x 52 =$117,000 right? MINUS 15% self employment social security ($17,550),
Overhead is so far at over $20K per year-Shall we add in vacation & sick time? At my experience level if I were still civil service it would be 4 weeks a year but lets say only 3. (117,000/52 x 3 = $6,750) so now we have brought that 6 figures down to around 90K (I know, I should figure SSI on adjusted gross but you get the idea). Income taxes?
Lets pretend I can still legitimately drop myself to a 15% federal level – that takes me down to about $75k net so far. Oops! Governor MoonBeam wants his cut! Down to $68,500 now. Legal fees? Hmmm. Last year WAS a bit unusual at $172,000 but EVERY appraiser needs to build up a contingency fund. So say $10K set away each year that you PRAY wont be needed, but just in case? Down to $58,000 now.
Now out of the ‘salary’ I pay myself I still have the other 85% of my mortgage payment that the business doesn’t pay. Thats $2,200 x 12 x 0.85 = ($22,440)
Down to $35,560 now. Anyone out there ever get sick? We are only three in my household, but lets agree that HC is going to run $1,200 to $1,800 a month. (Up to $21,600)- leaves around $14,000 left (roughly). Birthdays, other holidays, gifts? Family emergencies? How about spouses or significant others and children? Anyone here get by giving spouse LESS than $500 discretionary $ per month? How about food? We gave up eating because I don’t DO 5 appraisals a week but for most families eating is pretty much a habit. $400 a month? $500? Y’all run around naked in your house? We have a young daughter so that’s probably not appropriate for my house. $150 a month?
$200 left! Rolling in the dough now! Cats wont get to eat each month but as long as they stay healthy I can feed them every other day, right?
By the way, getting orders in a nice convenient steady stream so you can do one each and every day, with NONE of them being complex (about 1/3 are as a rule) is also not happening.
So lastly, you think no one takes 15 hours for an appraisal? I’ve spent that long on desk reviews. MOST of what I do takes more than 15 hours. This last post of yours about 15 hours along with “who only does 5 a week’ tells me you are either not an appraiser or you are a superficial minimalist who has been lucky so far in reviews.
My guess is you are a staff reviewer for an AMC
You’re just being silly. Your home office & utilities are a write off not an expense. Even if you weren’t an appraiser you would have a phone, car and internet. You also get to write off your mileage in most other jobs you don’t, and that’s a really big deduction. Mike, you’re another guy that loses creditability with every post.
So says the anonymous guy touting the AMC low pay mantra. Obviously not an appraiser.
Seneca in order to write something off, I must first PAY it. Now my home office is discretionary and many of us work at home to either save money or time. My office in Beverly Hills is NOT part of my home office expense. $100 a week for parking; same for gas and 3 hours aa day out of my life commuting. Note I dont list rent there since the office space is given to me for free. Do you use your same phone for home and personal use as for business? Some do. Some dont.
Fact is office & overhead for self employed nationally usually runs from 25% to 50% of gross receipts.
Jesus Wayne? Are tone deaf? Have you done the math? $450 just one appraisal a day 5 days a week and you make 6 figures a year. How can you complain? Overhead in appraising is less that $800/mo. Even at $350 you make 85k/yr only doing 5 a week. But who only does 5 appraisals a week? While I agree that I don’t like the external forces in this industry, it has paid me very well over the 26 years including a record setting 2017. $11.00 for a movie snack is one decision I am glad don’t have a hard time making when there are many who don’t even think of going to the movies because they only make 48k. BTW Outback sucks.
One presumes cost savings are returned to consumers and the consumers have benefited from your ability to provide equivalent service for a lower cost? That’s how it’s supposed to work. That’s called pricing in the free market, benefit of scale. If you’re discounting to get ahead of the competition and assignment decisions are based on fee instead of quality, that’s called undercutting. When the distributor profits while concealing these windfalls created from deceptive pay to play practices from interested parties, that’s called fraud. When they share those profits back with lenders, that’s called a kickback. The legality of the various described practices have nothing to do with income amount, but rather have everything to do with ethical compliance of the process and approach itself. The junk fee, the unearned fee, the truth in lending disclosure rules, fdic rules on assignment practices regarding qualification, none of those dictate any standard fee or volume, rather they dictate what is acceptable process, and what is not. Concealing variable fee rakes and pocketing the difference is just dirty business. If a distributor engages in a contingency based process which would otherwise be illegal for an appraiser to engage in, the approach can not be justified with sound ethics. Individual appraisers licensing for all distribution works should clean that up in a hurry. No offense, but this has been the broken record repeat argument of the decade. To date nobody can justify this approach and now new events show us how desperate assignment companies really are to conceal this process from investigative and rule making authorities.
I believe so. In addition, this guy serves one part of his state one day, a second part on another, and on a 3rd and final inspection day the last part of the state. Apparently nobody in his area has a job, as he says only one or two people a year happen to not be available the one time a week he serves their area under a two hour window. I guess now he has some all star appraisal or some Star Trek Academy where all of the mind tricks are taught.
Now thats funny!
I like Dustin…and even know ONE appraiser in Los Angeles that follows SOME of his strategies and they work for him (SRA). They wouldn’t work for me, but for my friend they do.
My friend is also exceptionally organized; very efficient, extremely computer literate (as only a former IT guy can be) has a dedicated spouse that is very experienced in appraisal issues helping him and still uses a second assistant. Apparently he uploads most of the data and report is almost filled out by time he goes back to office for it.
In fairness my friend also USED to run a paperless office. I think I’ve cured him of that.
That’s the $64,000 question Wayne. Long ago (1993) I told all my former associate staff appraisers that they were crazy to keep working for LSI because it amounted to serfdom.
The fees had gotten so low that these guys had to work 14-18 hours a day in order to do two appraisals per day on average. Working 7 days a week just to maintain an average of +-14 pr week so they could earn $4,000 to $5,000 a month. Most were family men. Many were also first generation immigrants with an extreme idea of normal work ethic.Some stayed with that client because they accepted all caps typing; and didn’t nit pick about grammatical ‘errors’ typical of ESL practitioners. But, as time progressed and these guys become better in all aspects they were still trapped.
They just didn’t have the time to go out and look for new jobs or to develop new business. They truly owed their souls to the Company Store.
…and don’t think for a minute that AMCs don’t know this and rely on it.
I hope all the AMCs get arse cancer and rot away!