Flagstar Bank Eliminating AMCs
Flagstar Bank’s Direct Vendor Appraisers
Appraisers,
I have just learned from reading a forum that Flagstar Bank is doing away with the AMCs they use, and bringing appraisal ordering back in-house.
However, you must agree to this:
PLEASE NOTE: We only pay via ACH (automatic deposit twice a month on the 1st and 15th) so your bank information is also mandatory. There are no other payment methods available at this time so if you prefer not to use automatic deposit we unfortunately cannot add you to the panel. Also effective July 24th, 2017 there will be a click fee charge of $10 per appraisal and $6 per updated appraisal type (not revised revision request). You will have to maintain a Credit Card on file to upload each appraisal.
The red info is something you’d better pay attention to, because a USPAP reporting requirement is to reveal in the report when you ‘pay a fee’ to accept an appraisal assignment. Both the fees noted above meet that criteria.
Some appraisers don’t realize that when you MUST pay an upload report transmittal fee in order to get the assignment, that also means you have had to ‘pay a fee’ to RECEIVE the assignment, and the fact you have had to pay a fee MUST be disclosed.
Per USPAP:
Management:
An appraiser must disclose that he or she paid a fee or commission, or gave a thing of value in connection with the procurement of an assignment.Comment: The disclosure must appear in the certification and in any transmittal letter in which conclusions are stated; however, disclosure of the amount paid is not required. In groups or organizations engaged in appraisal practice, intra-company payments to employees for business development do not require disclosure.
Rather than argue about this, just do it! Put a statement into your addendum about the procedure. When you have not paid any kind of fee, just remove that statement.
Dave Towne on e-AppraisersDirectory.com
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I wonder how that fee compares to the amount an AMC takes for an assignment. Of course that would all depend on the fee Flagstar is paying their panel appraisers.
They pay full fee and there is no hassle; I love working with Flagstar
Dave,
I think your overthinking this and making a mountain out of a mole hill. Upload fees are are not commissions, but the cost of doing business with today’s technology . USPAP was written pre-internet and any appraiser doing origination work, other than VA is likely paying upload fees, why not focus on the positive that FlagStar Bank is getting rid of their AMC which paid horrible fees to appraiser’s? Just my 2 cents. Overall, I enjoy your posts.
Ralph that’s like saying payment of baksheesh or mordida (bribes) is simply a cost of doing business in certain countries. U.S. law prohibits U.S. Corporation and companies from doing it.
Any ‘new cost of doing business’ mandated on me by law or monopolies is not ‘simply anything’…except extortion.
I have to agree with Mr. Ford on this one.
I just took a USPAP class and was under the impression that you do in fact have to disclose this fee. We actually spoke with regards to the upload fees that AMCs are charging.
I’m on their panel and they pay full fee. They are the best to work with.
I will say that I still do Flagstar orders for an AMC; so they are not totally rid of AMC’s yet
That fee gets reimbursed to you on your check…per my experience with them
HEY EVERYBODY, FLAGSTAR REIMBURSES THE UPLOAD FEE WHEN YOU GET PAID..SO JUST STOP
Ralph, ASB has a different opinion:
“Inquiries have been made to the ASB regarding whether this includes referral fees or fees associated with a delivery system required by the client or agent of the client. The use of these delivery systems, often called portals, has become increasingly common in the appraisal profession. Some systems are provided without a fee to the appraiser, while some providers charge an added fee. The question arose to whether this type of fee is a fee paid to procure an assignment. The response depends on whether the procurement of the assignment is conditioned on the appraiser agreeing to pay the portal delivery fee. Some have countered with examples where monies were paid to carriers such as FedEx, the US Postal Service, or UPS, for transporting the documents. However, the key issue in these instances is whether the appraiser was required to use a prescribed delivery method and was the appraiser required to pay these costs as a condition of procuring the assignment.
The payment of such fees raises a concern about an appraiser’s independence, impartiality, or objectivity; and therefore, a mandatory disclosure is appropriate. Typically, any agreement that the appraiser will pay a fee to use a portal specified by the client (or agent of the client) is a condition specified as part of the appraiser’s engagement. This agreement to pay is something of value given by the appraiser in connection with the procurement of the assignment.”
In the days of hard copy reports I told the client in advance that I would increase the fee depending on the number of copies they required and the method of delivery. NO charge for regular 1st class or pick up by their messenger (title companies used to do that for free); FedEx or UPS fees were added.
The primary difference between then and now is that (1) the client KNEW and agreed in advance to the additional fees; and (2) I wasn’t required to take delivery fees from my own pocket hence there was no payment of fees to ‘secure’ an assignment.
Why don’t they just lower their appraisal fees by $10 and be done with it. Idiots.
Why not raise your fee by $10 and be done with it.? Why do I have to lower my fee to upload the report.
Fee negotiations are slightly different with the volume guys, the top 20 and other small scale guys with limited panels whom effectively push similar strong volume to a smaller panel. It’s a lot tougher to get that 10 or 20 spiff. But then again there is fair balance with direct as opposed to shopping. 550 minimums were essential in CO for us to keep up the pace and answer the demand. It’s important for appraisers to understand the regional relationships, and the way fee shoppers like amc’s and such know very well they’re paying one appraiser half rate vs the other appraiser in a different locale, despite the parent lender having a static nationally applied consumer fee. If you’re in a location where companies errantly apply the idea you’re worth less by proxy, being closer to other available appraisers, you’re getting a double whammy. Not only are you getting less and the amc profiting more, you’re also getting additional downward fee pressure as the company rakes more from your fee to compensate against appraisers in locales like CO, TX, OR, where we have successfully driven fees up. This is a primary reason I find it ethically difficult to pursue amc’s as primary clients, it’s heart breaking to think that because I make fee headway, an appraiser elsewhere takes shorts as a direct result of my actions. Direct is all around a superior approach and appraisers should immediately prioritize direct above all else. What’s wrong with symbiotic business relationships? Amc’s had their chance for a full decade and despite their self centered investments in tech and efficiency on their end, better this better that, they still fail to provide fair balance across the board.
Appraisersblogs rocks!
Mailing a paper check is not that difficult. We deal in paper and I only accept orders which result in a check in the mail. They’ll come around, I’ll sign up, once they figure out how to sign and mail a check.
The ONLY fees that should be paid, are to the appraiser. AMCs will be dropping off the grid soon. Hang in there and don’t bend over for these BS fees.
I prefer the direct deposit. However, I set up a business saving account for it. As soon as it comes in I transfer to business checking. What they put in they can take out and this prevents that.
With all the inexperienced underwriters out there, paying by the CLICK can get very expensive. They’ll take it from your credit card thus reducing your already reduced fee.
Yes. That’s one reason why I’m active Mercury vs AP and others, the singular charge which means no risk of fee reduction for complex orders. Think about the per re upload charge and what that means. Every complex assignment will likely result in reduced fee via underwriting clarification rounds. The exact reason why I bounced away from AP. Upload fees are so silly, because absent of CU XML, regular email would be perfectly satisfactory. It’s just a write off which I could have spent on more productive business building efforts. Although minimal that cuts into my business growth by redirecting money to portal organizations. Middle men for the middle men.
I just saw someone post the following in another forum so I’m going to share it here. Be careful about giving your bank account info to AMCs or others for ACH payment. They can as easily withdraw money from your account.
“The secured creditors take everything. I had a payment clawed back by the courts in a bankruptcy for an AMC years ago and it was made two months prior to the bankruptcy proceedings. Looked at my bank account one day and over $1500 had been withdrawn. I got a certified letter two days later from the court stating it had been taken to satisfy secured creditor debt. They can go back several months if they choose.”
The good part is the borrowers are now used to paying a “Customary” appraisal fee of $700.00 (including AMC fee that was never seperated) so our fees should be $700.00.
Click fee charge and update charges?
Flagstar, If I’m ever desperate enough to do business with you don’t forget to add my own 15% “KMA Fee”
YOU figure out what its for!
Re; Mikes comments on knowing about up front fees. Oh yes, now it’s important to remember the Reikin or gratuity fee in order to get those assignments. Now I suppose we’ll have to follow the money and check how much stake the amc’s have in the distribution portals. Still though, I’d rather pay to play a static amount and get static fees rather than try and build a business around a question mark, navigating an infinite stream of pointlessly micromanaged fee shop orders. From the lenders site of it, it’s quite complicated so any major lender who at least transitions some regions away from amc’s is appreciated. The unfortunate caveat to any number of supposed leads regarding who’s going truly direct in-house and who is not, is that companies may still utilize amc’s to distribute a variable portion and might be only testing transitions in one major region of distribution and not the other. Keep fishing, you’ll catch one eventually.
Be careful, I HAD 1 client that send electronic, and didn’t bother reporting what the file was, just put the money in and never sent a statement….got rid of them right on the spot. I figured so the apprasiers wouldnt notie a payment wasnt made. I hate all AMC’s.
I used to have one that was like that when I was doing transaction appraisal work. Fortunately volume was low and I cold figure it out but Chris point is valid. All should consider the following (assuming amounts are all the same).
Create an “Appraisers AMC / AMS” section on your webpage and list all YOUR policies.
1. The appraisers stated policies on this page supersede any and all lender boilerplate ‘standards’ and or requirements. Placement of orders constitutes conformation that client has read and agrees to all terms and conditions on this page unless otherwise specifically noted and consented to by the appraiser in his or her order acceptance.
2. Unlabeled payments are applied on a first in -first paid basis. All payments are applied to oldest invoices first
Any other necessary limitations you deem to be warranted AND reference the URL as a condition of the appraisal.
OK, admittedly too many exceptions might be over reaching. Just ‘thinking out loud’ so to speak.
All reports are subject to professional inspection for roof, foundation, plumbing, and electric…….
I’m going to side with Ralph on this. And equating bribery to a tech fee is quite a stretch. One procures inclusion in the AMC’s roster not in one particular assignment. The $10 is not a commission for the AMC sending you biz but a rip off processing fee by the tech provider. Presumably the AMC does not pocket the money.
More lenders are going back to individual fee panels. I for one, am happy to see this.
Just spoke with flagstar about signing up on their panel in NY. The fee for Rockland county which is close to NYC is $300!!! They can keep it!!!