AMC Fined for Appraisal Order Blast Violation

Baggins says:

These have been issues for a very long time. I wrote this to the fed in 2011. You know, it’s like, why bother with single 3k fines when these companies have clearly deserved 10k & 20k DAILY fines for EVERY SINGLE INSTANCE of this behavior, since Dodd Frank passed. They paid off someone at the CFPB to circumvent the LAW, and the ‘safe harbor rule’ is still to this day, purely fictitious. These amc companies should not exist in the first place, not in their current form at least. They should be fined out of existence. / I can’t call up the quick images I had of the 10k/20k fines language. Anyone happen to have that for a quick post? If we’re talking regulatory actions and fines, it’s important to always call up the most important one which was nearly enforced, but was never really enforced. The C&R rule with it’s subsequent 10k/20k fine demands, pointed specifically at amc companies. So many of the appraisers who worked so diligently to get that through simply quit the industry when the safe harbor rule came forward. Lack of enforcement on this one point has devastated the industry. None of the ensuing lessor rules would have even been necessary, if this one rule had been enforced. There would be no shotgun bidding in the first place if amc’s were held to the C&R rule. Think about it.
_____________________________ (2011 letter)

Any revision to, or replacement of the follow criteria stated clearly in Dodd-Frank, a federal law, would require Congressional Amendment – not arbitrary gross misinterpretation of the actual LAW:

Dodd-Frank ‘‘(i) CUSTOMARY AND REASONABLE FEE ‘‘ Fee studies shall EXCLUDE assignments ordered by known appraisal management companies.”

Kindly advise when the fictional “Option 1” now in the published Interim Final Rule will be removed.
Thank you

Predatory lending practices and subsequent preferential appraiser selection choices is an ongoing event which the implementation of HVCC, and related policies have not successfully managed. Amc’s have walked right over the appropriate intention of their business position to quell predatory lending, & real estate valuation flipping & flopping, the same way they have walked right over C&R appraiser fee laws. Lack of round robin rotating fee panels allows for a multitude of advocacy related problems in real estate appraisal distribution.
What works is the tried and true traditional approach, similar to the VA panel, as well as many existing in house distribution rotating panel credit union methods.

Having a biased middle man who seeks to appease the wishes of lending client commission based brokers is not much different than an appraiser being pressured directly by a biased lenders agent who utilized preferential assignment practices at the expense of fair consumer protection to maximize their profits. In fact, they are markedly similar.

The amc will preferentially choose appraisers that show advocacy in favor of the lenders more often than not. Lack of rotating panels means one single appraiser can cause a systemic problem with valuation security and that can go on indefinitely because the amc will not risk losing their lender clients any more than that one bad appraiser will risk losing his preferentially assigned appraisal work. Independent valuation opinions essentially cannot co exist within a climate of preferential appraisal assignment.

These are advocacy related issues which drive the entire structure of appraisal ethics. An appraiser must not be an advocate. However, feeding consumer appraisal charges back to the lender, their subsidiary amcs, or even making deals work so an appraiser can keep up their automated amc grading to receive more work, are points in fact which are at odds with proper ethical appraiser rules.

Is it too late for someone who knows how this works to examine this? The current implementation and interpretation of these rules is clearly erroneous. “The fox guarding the hen house” rings so true.

The appraiser is many times the only person on the front end of loan to be a truly unbiased party, they are supposed to be uniquely qualified to assure the collateral worth is adequate. Preferential assignment practices have and will continue to cause these basic checks and balances involving appraisers, salesman, and brokers to be meaningless.

Baggins says:

Bill you need a call blocker. I have an analog one which holds 10,000 number capacity. One press of the button and anyone calling from a specific number will get auto hung up on after a single ring, forever into the future. Because it’s analog I and I alone have strict total control of what numbers are blocked, and what numbers are allowed through. I’ve spent more time getting off of amc lists then I ever spent getting on them. These days the amc’s don’t even ask appraisers for permission, the amc’s just blast the orders outward indiscriminately to whomever will receive them. All many of these amc’s need is verification the appraiser is still alive and they have a valid email or phone number contact, and they’ll send the appraisers bid and quote requests without any other validation or verification, forever to infinity.

As for as dealing with them, try this standardized response… attached.

First one to say a number loses. Classical negotiation techniques never grow old, they just change slightly with time and the situation. The concept is still true.

JFK: “You can not negotiate with people who say what’s mine is mine, and what is yours is negotiable.”