MAI - Is it worth it?

[tsiegel]

I have been a CG appraiser for 7 years and have always worked under an MAI. I have recently been considering changing that arrangement. That got me wondering if I should start working on my MAI designation. I have heard a number of MAI's say it isn't worth it and I have heard some say that they most certainly get additional work because of it.

I am 34-years old and figure I have a significant amount of career left in me and why not make the best of it. On the other hand I don't have a college degree and this means that I will have to jump through some additional hoops in the process. I see many appraisers getting along just fine without the designation and I myself have done ok without it. I guess I wonder if there is a return on investment or if it would be simply to satisfy my own desire for prestige. I thought I would put this thought out there to see if you all had any thoughts you wanted to share.

Thanks.

 

[Ken B]

The designation opens doors. It is up to you not to be tossed back out the same door.

 

[The Warrior Monk]

In general, I think it is worth it. It is possible in some areas it may not make a difference due to lack of competition. There are some type of clients that prefer the MAI designation, and expect to pay for it.

 

[tsiegel]

In general, I think it is worth it. It is possible in some areas it may not make a difference due to lack of competition. There are some type of clients that prefer the MAI designation, and expect to pay for it.

What type of clients?

 

[Semi Pro]

What type of clients?

I've been told many banks have internal requirements that any appraisals for loan amounts over a set dollar have to be by an MAI. It varies lender to lender what that amount is. Also, I've seen many leases that call for market-based rent renegotiations or purchase options require the involvement of up to 3 MAI-designated appraisers to establish rent/value (often 1 for each side, and if the values are too far apart a 3rd MAI chosen by the other 2 MAIs).

 

[The Warrior Monk]

What type of clients?

There are more than a few attorneys that prefer to use MAIs; in particular, those situations involving litigation. I see this occur many times over the years. In the last case I testified in, the opposing side used an appraiser because he was an MAI, even though he was from 60-70 miles outside of this specialty market area. Many of the regulars expert witnesses have the MAI designation, or in rare cases are attorneys themselves.

There also seems to be preferential treatment given to MAIs from certain lenders, government agencies, etc. Given a choice between an appraiser with or without the MAI designation, the client often chooses the MAI, all other factors being equal.

 

[The Warrior Monk]

I've been told many banks have internal requirements that any appraisals for loan amounts over a set dollar have to be by an MAI.

Lenders are prohibited from selecting appraisers solely based on their membership in an organization; see FIRREA Section 1122(d). However, it may be one of the considerations.

 

[Semi Pro]

Lenders are prohibited from selecting appraisers solely based on their membership in an organization; see FIRREA Section 1122(d). However, it may be one of the considerations.

MAI does not mean membership in AI. I'm a non-designated member of the Appraisal Institute, so membership in the organization doesn't get me the job over a non-member.

Here is the full paragraph

[FONT=arial, helvetica, sans-serif]PROHIBITION AGAINST DISCRIMINATION.--Criteria established by the Federal financial institutions regulatory agencies, the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, and the Resolution Trust Corporation for appraiser qualifications in addition to State certification or licensing may include education achieved, experience, sample appraisals, and references from prior clients. Membership in a nationally recognized professional appraisal organization may be a criteria considered, though lack of membership therein shall not be the sole bar against consideration for an assignment under these criteria.

If MAI designation is considered an indicator of a level of education achieved and/or experience, it seems like it would be a legal selection base to me. Of course I'm at the tail end of working on my designation, so maybe I'm a little on the hopeful side for my return on the time and money put in.
[/FONT]

 

[Ken B]

In other words, lack of membership can't be the only excluding reason to not engage; however, not having successfully passed a review of a demonstration report for a nationally recognized professional appraisal organization can be the sole bar against consideration.

The lender that paid $1,250 for the appraisal of a 16,000 SF office building, as discussed in a different thread, likely could have not cared less about any qualification other than a license. A REIT or insurance company is likely to care very much about an MAI designation.

 

[incognito]

I became an RM (today known as an SRA) in the AIREA in the mid '80's. I completed ALL of my education requirements for MAI, and completed 4 of the 5 years of experience credits necessary, by the end of the '80's. I did not have a 4 year degree, but at that time they had a college equivalency option, which was to take the GMAT, and score in the top 50% of the test takers in that sitting, nationwide. I'm a good test taker, and nailed that no problem. The residential work took off, and my market became flooded with MAI's, and I was out earning most MAI's at that time. I never did get that last year of experience credit, and never took the comp exam, and eventually dropped my MAI candidacy.

Looking back, I think it was the right decision, FOR ME. One of my good friends was at the same stage as I was, and did get his MAI, did well, but eventually went into Commercial Real Estate Sales, because there was just not enough demand for MAI commercial work.

Today in my area, we are rich with MAI's (many of whom retired to Florida and will take on a job or two for ridiculously low fees, just to keep busy). I have made a very good living doing Residential, and an occasional non-complex commercial job here and there.

You need to assess your market and your likes. Look in the AI directory, and see how many MAI's there are within 50 miles. If you really like doing commercial work, and do not contemplate making a living doing residential, I would very strongly recommend pursuing the MAI. The AI may still have some degree equivalency option available. Good Luck...