The Power of No!
Appraisers always had the power to end the appraisal management pyramid scheme. All we had to do is say no. Low fees, headaches, and idiotic reviewers have reached maximum capacity. The imploding of appraisal management companies is forthcoming.
Over the past few months, appraisers have been simply saying no to low paying, time wasting, headache giving appraisal management companies; problematic portals too. I even read recently an appraisal was unable to be uploaded to a portal because the opinion of value was below the contract price. This type of influence rises to a whole new level, not to mention the illegality of it. Just saying no is so rewarding to your mental state.
Who is overseeing the bad actions of appraisal management companies? Who oversees the portals? Dodd-Frank mandates states license and oversee appraisal management companies. Are they? Some have tried, but for the most part, states are not enforcing customary and reasonable fees, nor are they enforcing their own laws and regulations. Could it be fear of law suits because of the ongoing FTC actions against the Louisiana Real Estate Appraisers Board? Ever notice the uptick in discipline cases against appraisers? Could that be because of appraisal management companies?
Desperation to find anyone to complete an appraisal is clear with every order being a bid request; bid requests from AMCs you have never heard of; and requests to complete an appraisal for residential lending when it is clear the property is not residential.
I no longer work with any appraisal management company. I transitioned my business to working with clients who value my expertise and agree to my terms. I have not updated my credentials with any appraisal management company in over 3 years and still receive about 10 requests per week from appraisal management companies. I no longer utilize any portal that requires me to pay fee. Bid requests get deleted with no response. Many go directly to my spam folder. I am no longer wasting my time. My clients call me to discuss their needs or assign me the appraisal directly if it is not complex. My life is less stressed, my income is up and my wife says I seem to enjoy what I am doing more.
I have often wondered why appraisers accept a lender or appraisal management company engagement letter. According to USPAP, which we all must follow, appraisers must determine the scope of work necessary to produce credible results. Do these 10-20 page “instruction manuals” allow you, the licensed appraiser to determine what is necessary for credible results? Could these be causing appraisers to bypass their obligations under USPAP causing the increase in complaints to the licensing Boards? Appraisers write the engagement letter for private clients, why we would not do it for lender clients. By definition appraisal management companies are not our client. They have no authority what so ever.
Appraisal Management Companies cannot survive without appraisers. Appraisers can and will survive without Appraisal management companies.
We have the power to eliminate this unnecessary layer. Use the power of no and let the appraisal management companies self-implode.
By By Milton P, Certified Residential Appraiser
100% agree. Nothing to add.
Like Nancy used to say “Just Say No”.
Most AMC’s only want the value to be there so their clients are happy and continue to send them work. We used to work with 27 AMC’s and eventually fired every last one of them because they lobby for value. That system was broken from day one. They are like the old brokers of yesterday and the industry knows that. Here’s the things an AMC wants: value to close the loan, fast, and cheap. Nothing more
I always say no to unreasonable compensation, unrealistic turn times, free & unchecked revisions & especially paying a fee to an AMC to complete their work for them (portal, technology, maintenance, upload, etc., fee {& do not suggest add it to my cost, it should not be there}.
ok what about the upload fees with companies like mercury and app port which facilitate for the lenders basically an email portal…mine recently went up to $20! from $13 per file
Yes Ronny, I’ve quoted the press release from a few years back (A la mode / spinning of the Mercury Network) many times before, but it bears repeating. At the time of sale, A la mode indicated they did 20,000 transaction A DAY. Apply any matrix you want ($13 / $20), but long story short, the theft from the appraiser is in the hundreds of millions or more.
Seek the truth.
This was breaking news 11 years ago. Good luck with your pipe dream though.
Although perhaps individual appraisers may be doing less AMC work (?), unfortunately, many coach and thus many follow the volume / business approach where the attitude is “the hell with what’s right and moral, let me get mine & more”.
Meaning, that after you burn through your direct lender clients, civil use work, etc. (C&R pay), there is a conscious decision to build out your business by way of outsourcing the appraisal process (Philippines anybody), and by doing AMC work on a high volume scale to offset the lower pay. In other words, based on this business choice (high AMC volume), these companies are a bigger threat to the industry (do more harm), compared to the individuals who are just trying to survive.
Again, no need to judge others / individuals who in the short term may do AMC work to feed their families, but in my opinion, those who move past AMC”s only to come back to further line their pockets, have done and continue to do harm to the profession.
Seek the truth.
As I’ve stated many times before on this site, AMC’s are getting away with this because they have created a new culture of appraisers who are taught to do what they are told. USPAP is an after, afterthought. ALL of an AMC’s procedures are based on making their job more efficient and profitable which usually requires more work and risk for the appraiser. As long as banks and AMC’s can keep the oversupply of appraisers up, they can treat appraisers like employees without employee benefits. As appraisal work continues to climb, think long and hard about taking on trainees to make yourself more profit in the short-run. It is imperative that we be mindful of the balance between appraiser supply and demand, this is the main factor that affects our pay and job security.
https://www.ocbj.com/news/2020/jun/26/corelogic-soars-25-after-takeover-offer/
Big changes coming. The Appraisal Plantation is about to get new owners.
Must know more details regarding not allowing to upload due to below contract. Excellent, popcorn.
The above story…
RESO: Open up the American real estate markets to the entire world, and force Americans to change their own traditional definitions of real estate in the process. What could go wrong? How convenient, Black Knight taking over Corelogic right as that happens.
https://dsnews.com/news/01-08-2018/global-dms-integrates-platform-black-knights-technology
https://www.globaldms.com/etrac
https://web.archive.org/web/20210306011500/https://www.globaldms.com/blog/etrac-proxypics-allows-lenders-amcs-to-complete-inspections-remotely-provides-free-access-for-all-appraisers
https://nationalmortgageprofessional.com/news/74822/global-integration-allows-remote-real-estate-appraisals
The American appraiser is going to be replaced with cheap foreign labor who won’t even need to be in this country. The ‘crisis’ will one day be over. The allowances will be permanent.
I’ve been AMC free for years, it’s great but now getting tons of requests for rush desk and field reviews, from AMC’s I’ve never heard of, which I just ignore, but shows you the quality of the reports in their race to the bottom!
Sounds like a dream to have clients that forego AMCs.
Around here, AMCs were highly successful getting lenders to sign-up for their “free” order system. We either work for or appraising provides part-time income. Matter-of-fact in research & peer communication, there is not one appraisal company “around here” that I am aware of that doesn’t “have-to” have AMC business.
The AMCs I DO service pay almost what & at times “above” what otherwise a FAIR FEE would be.
If ever, rarely & never accept complex assignments as the set-Fee doesn’t change for time-related complexities.
So, I try to work smarter not harder = Fee/time related.
Clients that I have had for decades went to the AMC ordering system & I have retained quite a few. I will not allow an AMC to influence USPAP compliance = BYE or NO.
So Congrats’ to YOU & the area you reside in !!!
No that’s a false perception. The borrower base is national in potential. They have open options throughout the internet. Many lenders do not use amc’s, and some borrowers do land with them throughout the country. Sometimes it’s just random.
Cherry picking is nothing to be proud of. Sorry charlie, the amc does influence appraisal results. You know as well as I do, if you upset them, you lose all the lenders they work with, not just one. Independence; denied.
Ralph, Appraising is not just about lender work. Divorce, estates, insurance, pre-sale, cash buyers, family divisions, timber, agricultural values, etc., are all good avenues for this profession. There is also consulting and personal property opportunities. Lender work is the least profitable and the least satisfying in my opinion.
What can I do about an appraisal management company that really does not check my reports? I will be the one eventually responsible for a bad report going out. Any suggestions?
If I am understanding your post correctly, you are assuming the AMC is YOUR quality control. That is a very dangerous assumption and simply inaccurate. The person or people signing the report are 100% responsible for every word in that report. No one else can or will ever be responsible for the content and quality of an appraisal report. Even when the amc or lender asks for a revision, the signing appraisers are responsible for that revision.
It is always good practice to run the software E&0 check, spell check, and then actually read the report yourself. There are always things that need correcting or changed. I personally like to let the report sit overnight before reading it. I find I actually catch more errors that way. When that is not possible, let it sit a while then read/ proof it.
I agree, and that’s why I’m astonished that some appraisers say they can churn out reviews on other appraisers work in as little at 30 minutes. Heck with that kind of speed, one could probably complete 4 to 9 appraisals a day. One is always liable for THEIR work, even if virtual assistants assist them from around the world.
Seek the truth.
I run all my checks UAD Check, spell check and finally a my own check with my glasses on this time., but I will miss something here or there. I am not assuming that the AMC’s are my QC. I will tend to go back through a few appraisals, and notice, how the heck did this get past our AMC, and underwriting??? I read through some of these AMC”s guidelines and it states they review the reports, I don’t buy it at all, I’ve noticed my worst report if it hits the value goes through, but my best report if it doesn’t hit the sales price, is all of the sudden the worst report they have ever seen.
Thank you for your input. Greatly appreciated.