Can I charge more for high price homes?

[normando]

What does USPAP say about charging higher appraisal fee for higher priced homes. I thought we shouldn't consider the price but the complexity. However, I notice lenders charge more for higher priced homes so I'll charge higher even if it's not complex. I feel the borrower can afford it.

 

[CANative]

Your fee can't be contingent on the opinion of value. That doesn't say you can't take advantage of client expectations that higher priced homes will have higher priced appraisal fees.

 

[ctapraser]

What does USPAP say about charging higher appraisal fee for higher priced homes. I thought we shouldn't consider the price but the complexity. However, I notice lenders charge more for higher priced homes so I'll charge higher even if it's not complex. I feel the borrower can afford it.

Your fee can NOT be based on the value of a house (higher priced homes), thats a no no.

You can say, this larger house will take longer to inspect, longer to measure and require expanding the area of research for data, therefore I am going to increase my fee to $zzz.XX:icon_mrgreen:

 

[Lee Lansford]

Your fee can NOT be based on the value of a house (higher priced homes), thats a no no.

...icon_mrgreen:

That's not 100% correct.

See USPAP FAQ #42.

The key is that the "value" or "price" upon which the fee is based has to be outside of the control of the appraiser.

 

[normando]

Can I use general guideline like homes over $2,000,000, I charge so much. Homes over $3,000,000, I charge so much. I know the AMC is charging higher for higher priced homes. I raise my fee trying to get a bigger portion of their fee in which I sometimes don't get the order.

 

[ctapraser]

Can I use general guideline like homes over $2,000,000, I charge so much. Homes over $3,000,000, I charge so much. I know the AMC is charging higher for higher priced homes. I raise my fee trying to get a bigger portion of their fee in which I sometimes don't get the order.

I would not do this, regardless of how you word it, as noted by others on this site, I would not go anywhere near that.

If I come across a +$1,000,000 property, sometimes the appraisal is actually quite simple and my fee is the same. CT has a ton of areas with ++$1,000,000. If its atypical for the area I charge more, not because of the value but the complexity of the appraisal.

 

[Riick]

Higher priced homes, 99% of the time, have more GLA & more complex floor plan, more twists, turns and angles to the structure.
More work = More pay - it's all that simple.

 

[normando]

May be that's why when I raised my fees for higher priced homes, AMC seem to find someone cheaper to do it. I just can't stand the thought of AMC profitting so much out of my labor so I want to take a bigger portion from their collected fee.

 

[CANative]

Make a price list like this (for example) - 1004 report, non-complex $350. 1004 complex - Quote.

 

[normando]

But the thing is not that complex. The house is larger and the lot is larger but lenders and AMCs charge base on price. Why is it they can get away with it but appraisers can't? USPAP is keeping our fees low.