The Appraisal Fee Lawsuit AMCs Can’t Outrun
The class action lawsuit filed against CrossCountry Mortgage and Class Valuation arrives at a moment when many in the appraisal profession have grown tired of watching Appraisal Management Companies (AMCs) drain the industry from the inside. Appraisers have described AMCs as unnecessary middlemen who inflate fees, hide their cuts, interfere with the work, and contribute nothing of substance. This case finally puts those practices into the record with a level of clarity that appraisers have been waiting for.
The complaint describes how borrowers are charged appraisal fees that often exceed one thousand dollars, yet the appraiser receives only a fraction of that amount. One line in the filing captures the problem directly: “Borrowers like Plaintiff pay appraisal fees that range from $450 to over $1,000… the AMCs pay the appraiser only a fraction of this fee, deceptively keeping the remainder for themselves.” The plaintiff paid seven hundred dollars for an appraisal, and according to the allegations, Class Valuation retained a significant portion of that fee while paying the appraiser far less. Borrowers were never told that most of the money was going to an AMC rather than the person who actually performed the appraisal.
The Appraisal Regulation Compliance Council (ARCC) findings released last year confirmed exactly how widespread this practice is. The fee breakdown chart that circulated across the appraisal community showed AMCs routinely keeping more than sixty percent of the borrower’s fee. Many of the entries in that chart were from Class Valuation, and appraisers recognized the pattern immediately. The appraiser’s portion was often the smallest slice, while the AMC’s portion was the largest. The chart made it impossible to ignore what appraisers had been saying for years. The borrower pays a premium, the AMC keeps the bulk of it, and the appraiser is left with whatever remains.
The lawsuit explains that borrowers are led to believe they are paying for an appraisal and nothing more. CrossCountry Mortgage told the plaintiff, “We may order an appraisal to determine the property’s value and charge you for this appraisal.” The filing states that this representation was false because the fee included an undisclosed management charge for Class Valuation. Borrowers are not informed of the AMC’s involvement until after the appraisal is completed, and even then they are not told how much of their money the AMC kept. By the time the closing disclosure appears, the borrower has already paid the fee and has no practical ability to choose another lender or negotiate anything.
The complaint also highlights the fundamental issue appraisers have raised for years. AMCs do not perform the appraisal. They do not inspect the property, research comparable sales, analyze the market, or write the report. The filing states, “It is the appraisers not AMCs or any of their employees who contact borrowers, schedule appraisals, conduct appraisals, and prepare appraisal reports.” The AMC’s role is limited to forwarding the report to the lender, yet it retains more than sixty percent of the fee in many cases. This aligns with the experiences appraisers have shared about Class Valuation’s fee retention, including situations where the AMC kept hundreds of dollars while the appraiser received a fraction of the borrower’s payment.
The suit argues that AMCs provide no benefit to borrowers and only a limited benefit to lenders. Their existence is tied to lender convenience rather than consumer protection. The complaint notes that lenders often create their own AMCs as subsidiaries because the profit margins are so high. Borrowers cannot shop for an AMC, cannot negotiate the fee, and cannot avoid the charge unless they buy the home in cash. The market forces that normally keep prices in check do not exist here, and AMCs take full advantage of that imbalance.
The legal claims include violations of the Florida Deceptive and Unfair Trade Practices Act, unjust enrichment, and breach of contract. The FDUTPA claim focuses on the AMC’s concealment of its fees and its misrepresentation of the nature of the services provided. The unjust enrichment claim argues that Class Valuation accepted and retained money that bore no relationship to the value of its services. The breach of contract claim targets CrossCountry Mortgage for charging a fee that was not permitted under the loan agreement. The plaintiff seeks damages equal to the portion of the fee retained above the actual cost of the appraisal, along with injunctive relief to stop these practices.
This case resonates strongly with appraisers because it validates what they have been saying for more than a decade. AMCs have inserted themselves into the appraisal process without adding value, and they have done so while siphoning off large portions of the fees. Borrowers are misled, appraisers are underpaid, and the industry suffers from a system that rewards the middleman at the expense of everyone else. Class Valuation has been at the center of many of these complaints, from fee skimming to inexperienced staff making demands on seasoned appraisers to automated review systems that generate unnecessary revision requests. The lawsuit places these issues into the public record in a way that is difficult to ignore.
If the plaintiffs succeed, the outcome could force lenders to disclose AMC fees separately, reduce fee skimming, and restore transparency to appraisal billing. It may also encourage similar suits in other states and prompt regulators to revisit AMC rules. For appraisers who have watched AMCs erode the profession, this case represents a long overdue challenge to a system that has operated without accountability for far too long. Many appraisers will see this lawsuit as the first meaningful step toward exposing the practices that have damaged the profession and burdened borrowers, and they will be watching closely as the case moves forward.
- The Appraisal Fee Lawsuit AMCs Can’t Outrun - July 24, 2026
- The Board Has Spoken, and AMCs Should Pay Attention - July 6, 2026
- Suspended: The AMC That Turned “Review” Into a Value Demand - March 19, 2026
The high costs of cheap appraisals.
https://appraisersblogs.com/systemic-failures-in-fha-appraisal-n-loan-review/
Ohh, and one MUST NOT forget that these AMC’s are also hiring STAFF APPRAISERS to do appriasals now and keeping ALL of the borrowers fee. They have circumvented laws that were not crafted stiff enough to take advantage of loopholes that allow them to hire so called “staff appraisers” up to a certain amount in each state in order to suck of all the fee the borrowers pay. Its high time for an overhaul of the AMC system or complete elimination of the whole SCAM! AMC’s were not created to work in the capacity that they are operating in.
Too much to hope for
Hey Lawyers!!! $12Billion in reparations out there since 2012… just sayin 👊😇
In NYC it’s already a law. I see amcs charging 200-700 over the appraisers fee. It’s on the invoice and it does nothing.
Richard Hahn It should be a law everywhere. There is no reason AMC’s should be allowed to keep their fees hidden from the consumer and appraisers. It should be cost plus if banks insist on using AMC’s they should pay them separately and not out of the appraiser’s fee.
Richard Hahn and are you sending the excessive AMC fees to ARCC and the state? Same with lowball appraiser fees.
Donna Halfpenny is arcc or any of the states doing anything to the appraisal management companies that charge the excessive fees
Chris Jackson they are working on it. If they do not have the data, they cannot do anything-see the problem? Problem that most appraiser are NOT filing state complaints, and ARCC can only do so much without all of the data. Did you see that ARCC is quoted in all of the AMC lawsuits? So yes, they are helping.
Donna Halfpenny Good. I have always thought it was shady that the AMCs tell us not to discuss fees with anyone. I think we should know the total fee the borrower was charged. Because they likely think that we get $800 to do the appraisal when we don’t get anywhere near that.
Donna Halfpenny this is the problem … ARCC doesn’t represent Appraisers and they have no teeth. Collective Bargaining defines everything for an appraiser, everyone stays on the agreement and appraisers don’t worry about AMC fees because the bank and borrower have to pay them. Please push for the organization of Appraisers. They deserve to be in control of their own future!
David Riedel, as an academic research our job isn’t to advocate. It’s to gather data and inform which is why three lawsuits now exist. There is another project in process though that will be able to advocate, DM for more info.
David Riedel clearly you have no idea what ARCC is or does. Josh explained. Organize appraisers? Herding squirrels on crack is easier. The mere fact that others are recognizing and are utilizing their work and data is important in in turn does help the profession. Their work is helping to support these lawsuits. So your claim of “no teeth” is void.
Time for Appraisers to get serious about their profession. The unions protect the janitors because they are vulnerable … appraisers have NO REPRESENTATION. I have encouraged unionization for more than a decade … now you get what the AMC gives you for the only paid work contributing to the transaction and still have to answer to the secondary market’s 12-page report. Unionize or continue being compromised! They say to live better, live union! Anything is better than letting Realtors, Lenders, Regulators, and AMC’s dictate your life! Who knows, maybe they give you good health insurance and a pension! It would be long overdue!
David Riedel, there is another way which is better. Cooperative
Josh Tucker Appraiser NEED to organize … either way needs to happen in 2027 or it will go from being under NAR’s finger to be back in the fist of finance/AMC’s.
Collective Bargaining would probably push the AMC to the bank, open up AMC’s to ONE Approval process for licensed, certified, and general appraisers and open bidding process – no more “you take the Pennie’s from the fee we established”. Somebody has to stand up for appraisers …
David Riedel, such a thing is being worked on
David Riedel appraisers are not, in any way, under NAR’s finger.
It’s about time. AMC’s have been stealing from borrowers and appraisers for far too long.
That’s all I have to say about this.
I had an amc offer an appraisal pay of $500 for me to travel 126 miles on way and they wanted to charge $150 for me accepting. No thanks
Lara Baker did you send the info to ARCC and your state?
Donna Halfpenny naw I just declined and kept moving I did give a little laugh
AMC’s put me out of business after 25 years.
I’ve never accepted work from AMC’s. Never have, never will. I don’t understand why others do. Deeply flawed business model, in essence letting the tail wag the dog. Woof!!
In part, you have appraisers who long ago decided to join with AMC’s and fight against the profession from the inside. Hell, for only a few thousand dollars (payable to them) these people would make you an all-star and give you insight on how to form your business around working with the enemy. Not sure if he’s still selling VHS tapes on how to appraise, snake oil on the corner, or focusing on rental properties, but does Smustin Smarris ring a bell.
For those interested in the CA case see below for the link and enter CV-24-008809 in the case number search. To read the filings, click on Events and double click on a document.
https://stanportal.stanct.org/search
Seek the truth.
Simple solution is have the homeowner/borrower pay the appraiser directly like it use to be!!!!
I have never done work for any AMC and never will. I will also never join a union. Not a fan. As long as you accept this work from AMCs, they will keep doing what they do. Don’t take it, don’t do it… If nobody accepts it, where will that leave the AMCs? In the trash heap of history. Wake up people.
If AMC’s are found guilty and forced to pay restitution, they will be bankrupt overnight. One by one AMC’s will cave. I’ve also been told that not dislosing their fees in settlement statements can be a $10,000 fine per incident/closing. That’s a lot of doll hairs.
Why This AMC Lawsuit Matters
This lawsuit against CrossCountry Mortgage and Class Valuation puts a long-standing appraisal-industry problem into the public record: Borrowers may pay $700 to more than $1,000 for an “appraisal fee,” while the appraiser performing the inspection, analysis, and report receives only a fraction of it. The borrower is rarely told how much the AMC keeps.
That is the heart of this case. If the borrower is paying for both an appraisal and appraisal-management services, the two charges should be disclosed separately. Calling the entire amount an appraisal fee gives borrowers the impression that the money is going to the appraiser.
AMCs perform certain administrative functions, but they do not inspect the property, select and analyze comparable sales, develop the value opinion, sign the report, or accept the appraiser’s professional liability. When an AMC retains the largest portion of the fee, borrowers deserve to know it.
This is especially relevant today as appraisers prepare for UAD 3.6, invest in new software and training, collect more property data, and face greater reporting demands. Appraisers are being required to do more while many AMCs continue searching for the lowest fee and fastest turnaround time.
The lawsuit is still in its early stages, and its allegations have not been proven. However, it could finally force lenders and AMCs to disclose how the borrower’s appraisal payment is divided.
The solution is simple: Show the appraiser’s professional fee and the AMC’s management fee as two separate charges. Appraisers deserve reasonable compensation, and borrowers deserve to know where their money is going.
Although I was told to not disclose my fees, I did anyway after a couple of years of not doing so. So many borrowers were so angry having to pay that $700 to $1,000 appraisal fee and typically took it out on me. So, I finally said F’ it and started telling the borrowers that I typically only got 1/3 to 1/2 of what they paid. Borrowers thought I was getting rich, some mouthing off that I must have been making $2,000 a day. Appraisers brought some of this on themselves, always bragging about how many appraisals they did a day to the lenders, AMC’s, brokers, borrowers, etc. People, DON’T EVER tell other people how much money you make or how many appraisals you do a day, especially those involved in the transaction. You’re lying anyway.
This Lawsuit Could Finally Force Transparency on AMC Fees
The article about the proposed class action against CrossCountry Mortgage and Class Valuation should get the attention of every residential appraiser in the country.
For years, appraisers have watched borrowers pay $700, $800, or even more for an “appraisal fee,” only to learn that the appraiser who performed the inspection, researched the market, selected and analyzed the comparable sales, wrote the report, and accepted the liability received only a fraction of that amount.
The rest was retained by the Appraisal Management Company.
That is the real importance of this lawsuit. It takes an issue appraisers have complained about for years and presents it as a consumer-transparency problem.
Borrowers Deserve to Know Where Their Money Goes
Most borrowers reasonably believe the appraisal fee shown on their loan documents is being paid to the appraiser. They are rarely told how much the appraiser actually receives or how much the AMC retains.
The plaintiff in this case reportedly paid $700. The lawsuit alleges that Class Valuation kept a significant portion of that payment while paying the appraiser substantially less. The borrower was not told in advance how the money would be divided.
If the borrower is paying for both an appraisal and appraisal-management services, those charges should be disclosed separately.
There is nothing complicated about that. The borrower should see:
The fee paid to the appraiser.
The fee paid to the AMC.
Bundling both charges under the label “appraisal fee” prevents the borrower from understanding what is actually being purchased. It also hides the financial relationship between the lender, the AMC, and the appraiser.
The Person Doing the Work Often Receives the Smallest Share
The appraiser performs the professional valuation assignment. The appraiser inspects the property, verifies the data, analyzes the market, develops the value opinion, signs the certification, and remains responsible for the report.
The AMC does perform administrative and compliance functions, but that does not justify keeping an unlimited or undisclosed percentage of the borrower’s payment.
Research submitted by the Appraisal Regulation Compliance Council to the CFPB included examples in which AMCs allegedly retained more than 60% of the total fee. Those examples were not a formal CFPB finding covering every AMC, but they showed why this issue deserves investigation.
When the middleman receives more than the licensed professional doing the work, something is wrong—especially when the borrower is never shown the fee breakdown.
The Timing Could Not Be More Important
This case arrives while appraisers are being required to adapt to UAD 3.6 and the redesigned appraisal-reporting system.
Appraisers must invest in new software, training, expanded data collection, revised inspection procedures, and more detailed reporting. They must also satisfy automated review systems and respond to increasing numbers of revision requests.
Meanwhile, many AMCs continue broadcasting assignments to multiple appraisers and awarding the work based largely on the lowest fee and fastest turnaround time.
That system does not reward experience, competency, or geographic knowledge. It rewards whoever is willing to accept the least money and complete the assignment the fastest.
This is not good for the appraisal profession, but it is also not good for borrowers or lenders. A credible appraisal should be completed by the most qualified appraiser—not simply the cheapest available appraiser.
What This Lawsuit Could Accomplish
This lawsuit will not automatically eliminate AMCs or guarantee higher appraiser fees. It is also still at an early stage, and none of its allegations has been proven.
However, it could force lenders and AMCs to disclose their fees separately. That alone would be a major improvement.
Once borrowers can see that the appraiser received only part of the amount listed as the appraisal fee, they may begin asking why the AMC retained the rest. Lenders may then have to negotiate AMC charges instead of simply passing them on to borrowers.
Transparency would also make it harder for an AMC to increase its earnings by reducing the amount paid to the appraiser while leaving the borrower’s fee unchanged.
The Bottom Line
Appraisers have been warning about AMC fee practices for more than a decade. Until now, those warnings have largely been treated as complaints from appraisers who simply wanted to be paid more.
This lawsuit changes the argument.
The issue is no longer just what the appraiser was paid. The issue is whether the borrower was misled about where the appraisal fee went.
AMCs are entitled to be paid for legitimate services. Appraisers are entitled to customary and reasonable compensation for their professional work. Most importantly, borrowers are entitled to know how their money is being divided.
If the industry has nothing to hide, there should be no objection to separately disclosing the appraiser’s fee and the AMC’s fee.
That simple change would bring long-overdue accountability to a system that has operated in the dark for far too long.
And let us not forget barney frank and another dumb ass came up with the law to PROTECT borrowers from high fee’s etc, So that the lender did not deal directly with the appraiser, again, to protect the borrower. Of course, those of us in the appraisal business saw immediately that if they put another layer in, somebody else had to get paid for their part. So, of course, as usual guvco interference immediately caused a problem for all involved along with a higher price for “appraisal fee’s.”Guvcco “fixed it” by causing prices to go higher and the appraisal process took longer. Yep, guvco at its best.
Half that fee should be going to the appraiser and they other half back to the borrower. They’ve been stealing our fees all these years. Borrowers have been paying more and we could have a wage increase on par with cost of living and inflation …. But the AMC has stolen that… and charged a tech fee to use their platform.
Refunds to borrowers? What about refunds to appraisers? It was our fee they took
Tammy Whaley no it wasn’t..
Tammy Whaley it should have been our fee, however, Appraisers who accept the garbage fees, get what they deserve.
Tammy Whaley lol nope. You took their low fee of your own free will.
Owners of AMC’s living in mansions and we fight over the scraps ! Pathetic!!! Hope something happens asap
Just wait until they utilize all these new “pathways” to licensure along with the “modernization”. Their long game through REVAA is taking shape. Low wage staff “appraisers” to rubber stamp glorified AVMs on forms. Instead of “managing” and assigning appraisals to third parties, they will just hoard in house and pay employees $22/hr. Once they capture the lending arena, they’ll market to CPAs, attorneys, etc.
Eventually there will be a handful of extremely wealthy CEOs and a bunch of low wage “appraisers”.
The beginning of the end already happened lol. Dying profession.