Senate discussion of 2452 today.

[lisagruhot]

With a bond an appraiser would be less likely to cheat if he had a bond of his own money he would lose if he got caught cheating. Why are you guys opposed? It would make are licenses more valuable.

I already think that my license is valuable, but someone who is going to commit fraud or cheat is going to try and do it with a bond or not.

I simply cannot afford the bond requirement. I would be out of business from the start. There is less work and this would be the killer for me. We are only a two person shop with me and my husband.

 

[rcsone]

....cost of entry whether it be money, intellect, physical strength, education, experience, etc. limits participation......and it would follow that the greater the demand for entrance, the greater the reward for inclusion......in business over time, the person or entity with the lowest overhead being either personal or professional wins....such is is........the appraisal business has been overpopulated and maneuvered by the lenders and their agents, including MB/LO's, AMC's and other appraisers.......so with the changes demanded by a fleeced international public for restoration of integrity of asset valuation, somethings are going to change in the appraisal profession(?) and with those changes comes opportunity and calamity....it has never been promised that successful decisions of any sort have a perpetual value......so I would suggest, survive and improve and reap the coming rewards whose time will vary by locale and situation....best to all........rs

 

[lisagruhot]

Bonding with not stop fraud. It will put many good appraisers out of business not just bad ones. The area that I live in is not overpopulated with appraisers. There is no way I could have any less overhead than I do. I already work out of my house. The only overhead I have is health insurance, gas, data sources, utilities, license fees, continuing ed, E&O, and software costs. The only thing that could be cut out is health insurance and I am not doing that. My husband had a heart attack a couple of years ago, and I have small children. I am not getting rid of health insurance. Everything else is required for me to work. So, what could I cut out to afford thousands of dollars for a bond based on values of the properties that I appraised? The area that I live in is a resort area. It would only take doing a few appraisals on those places to get it really up there.

 

[rcsone]

....the bond costs could be recovered at closing from the seller/buyer just like the rest of the mortgage fees and forwarded to the insurance/settlement company.....that would be the natural path, if not paid in advance with the appraisal fee.........and remember ALL appraisers would have to have the expense in their program......best to you..................rs

 

[rcsone]

...also would not the bonding cut cost be less than the AMC's......rs

 

[Marcia Langley]

It's true the cost of bonding would be just another add on to the cost of doing business that would be passed on to the consumer, one way or another.

One concern is that the initial outlay which would be based on last year's business would be an up front expense to the appraiser only to be recovered later on an assignment by assignment basis.

That alone will put many appraisers out of business because they would be unable to fund that initial outlay.

Also, some posters have said that bonding is not like insurance that pays a settlement but more like a loan that pays the claimant but has to be repaid to the bonding company. And that the bonding company will require that the appraiser have assets at least as great as the bond in order to even qualify for being bonded. That is, in addition to paying the cost of the bond, the appraiser must have a certain level of assets.

In other words the value of being bonded is that the bonding company has verified in advance that the appraiser has enough assets to make good on claims. That would knock out many more appraisers.

In many cases it would only take one claim against a bond to bankrupt many more appraisers and cause them to become unbondable.

It seems to me that bonding would have the effect of consolidating the appraisal industry into a very few large companies with pooled assets and eliminating virtually every small shop.

It also seems to me that this consolidation is exactly the goal of those who propose the legislation.

If this bonding issue makes it into law, I would expect some of the largest "appraisal companies", for example big box AMCs, to offer individual bonding to their subcontractor appraisers on a job by job basis.

The movement of the financial industry is toward this overall consolidation in all aspects of the mortgage business. That is no secret.

The big clients have always favored the big appraisal shops where they only have to set policy with the boss rather than dozens or hundreds or thousands of appraisers scattered all over the market area or the country.

Every responding comment made to the HVCC by the big mortgage industry participants (regulatory, banks, mortgage brokers, TAVMA, the TAF, appraiser orgs. ...) has furthered the cause of this consolidation despite the detriment it may cause to the individual appraisers' ability to remain unbiased, disinterested third parties.

 

[Mystery man3]

Survival of the fittest

If some appraiser can't afford the bond than good. A bond will kill all the part time appraisers which I think is a good thing. If there are less appraisers there will be more appraisals for the appraisers left. Less appraisers equals rising fees.

Just to make it clear if you are an established licensed appraiser you should want as many detriments to entry as possible. The easier it is to become an appraiser the less valuable your license is. Less appraisers equals more assignment and higher fees. This is the basis of supply and demand.

If you want to raise appraisal fees you need to limit the number of appraisers.

You do this by not training trainees, and lobbying for higher barriers to entry such as extra education, hours and fees (such as a bond) for new appraisers. If people do this fees would increase.

 

[lisagruhot]

If some appraiser can't afford the bond than good. A bond will kill all the part time appraisers which I think is a good thing. If there are less appraisers there will be more appraisals for the appraisers left. Less appraisers equals rising fees.

Just to make it clear if you are an established licensed appraiser you should want as many detriments to entry as possible. The easier it is to become an appraiser the less valuable your license is. Less appraisers equals more assignment and higher fees. This is the basis of supply and demand.

If you want to raise appraisal fees you need to limit the number of appraisers.

You do this by not training trainees, and lobbying for higher barriers to entry such as extra education, hours and fees (such as a bond) for new appraisers. If people do this fees would increase.

Wow. Thats nice. I can't afford the bond so I guess that will make you happy since there is one less appraiser. I am not a part time appraiser. I am fulltime and I have been for six years. Thousands of dollars upfront is a big obstacle for many. I am not a number hitter, I am not unethical, I am not a team player. So, its a good thing that ethical appraisers will be out while some of the ones that were team players and made more than me get to stay in because they have thousands to pay upfront?

 

[Karl]

Has everyone seen the newest thing Dave Biggers of Alamode has sent out?? No easier way to contact those in power with your concerns. IF everyone could get this & not a plug for Alamode!! BUT can't see why others couldn't send out something this easy to use to get your views sent in. For example where is the AI on this.

With this "program ,Web Site" Whatever you want to call it. NOTHING should be an excuse NOT to send your opinion in.

Again another Thank You to Mr Biggers for his assistance.

 

[Marcia Langley]

If some appraiser can't afford the bond than good. A bond will kill all the part time appraisers which I think is a good thing. If there are less appraisers there will be more appraisals for the appraisers left. Less appraisers equals rising fees.

Just to make it clear if you are an established licensed appraiser you should want as many detriments to entry as possible. The easier it is to become an appraiser the less valuable your license is. Less appraisers equals more assignment and higher fees. This is the basis of supply and demand.

If you want to raise appraisal fees you need to limit the number of appraisers.

You do this by not training trainees, and lobbying for higher barriers to entry such as extra education, hours and fees (such as a bond) for new appraisers. If people do this fees would increase.

Survival of the fittest is a good sound bite but that begs the question, "Fit for what?"

A large successful skippy shop could afford the bonding and survive, even flourish, in the move towards consolidation. I guess they would be considered among the "fittest" few to inherit the profession.

I suppose big box AMCs would also be among the "fittest" few.

Being the "fittest" has to depend on something more fine than who has most profitably scammed the system.