Let's Talk About What C&R Really Means And How It's Determined

[SutnNC]

I'll agree to some degree that "fees are regional" and call BS on the remainder. I'm surrounded by ready and willing appraisers that accept well under $400 in "this region": ALL DAY.

As somebody that is "in the field", you should already know that "standard fee" was a relative statement, not bible. The discussion is about appraisal fees. Before you jump the gun, don't assume that others don't possess the "vast knowledge" surrounding appraisal fees that you do.

I've provided some insight as to how I handle fees in my coverage area, you got offended.

I can't imagine why ?:/

 

[TRESinc]

never claimed or stated "vast knowledge" but i can tell you that if you are holding out for $400+ fees in my area of the state you will starve and lose your house first.

 

[Peter LeQuire]

I go to those conventions for the dark wood paneled walls and cigars.

Dancing girls: paneled walls, and cigars and dancing girls. And brandy - don't forget the brandy.

C&R is a joke, a chimera (an illusion or fabrication of the mind; especially : an unrealizable dream <a fancy, a chimera in my brain, troubles me in my prayer: John Donne> - Merriam Webster). While an appraiser waits for C&R, the biggest users of GSE appraisers continue to bid on the basis of fee and turn time. They believe theirs are C&R.

 

[SpartanAG]

Why are some appraisers willing to allow someone else determine what is a "Customary & Reasonable" fee for their business? It is your business. "Customary & Reasonable" is what you determine it is. You know your cost of doing business so charge accordingly. If an appraiser is allowing someone else to dictate their fees, then they have nothing to whine about. Take some personal responsibility, act like a business owner and set your own fees, otherwise "What you allow is what will continue."

 

[Meandering]

The appraiser has said: "Lenders are required by law (and are subject to severe penalties) to charge the same fee for the same service, unless they can show the service provided to a particular customer had additional costs (tract home vs. custom home estate in rural area)."

Cite the law and section number. Otherwise, it's BS. VA has a fee, and FHA has a fee, USDA has a fee, REO has a fee, refi has a fee, and sales have a fee. It's not the same scope of work, even though they are all appraisal reports, so I'm calling BS, else all appraisers would be paid the highest fee in line with VA and USDA fees.

The appraiser provided a case study where two separate appraisals were done on two different properties across the street from one another - but the appraisal fees paid were different. In the appraiser's opinion, that was wrong.

Does your friend have Alzheimer's"s? Does his many years of experience warrant the same fee as the newly licensed appraiser? Is a 1004 one price without regard to scope of work, intended users, or features of a property?

The D-F law, and the subsequent recent FDIC AMC Registration Rule (not yet published in the Federal Register, so no Effective Date established) says that 1) C&R can be established by applying published third party 'surveys' to a geographic area, and 2) C&R cannot be established by using fees paid by AMC's to appraisers..

3) use of government fee schedules.

It's is my contention that for decades, lenders have conspired together to keep appraisal fees as low as possible - because they DO discuss appraisal fees amongst themselves when at conventions, seminars, etc..

Because they use our fees to attract new borrowers. You'll never see lending advertisement that says, "Our appraisal fees are $600 because we use the best, most highly trained appraisers." Nope, "No closing costs" is what you see.

But then we appraisers are told we CANNOT discuss our fees amongst ourselves when we gather at various functions. That's a monstrous double-standard...

No one ever told me that, but I do remember the forum days of coyote and beaver pelts. But, in most states you can publish your fee in your report, and the AMC can't stop you.

So how then can C&R be established in an area where there has been no 'third party survey' done, and where appraisers don't know a range of fees in their area for a particular type of appraisal service because they don't talk with one another?

Nothing survives in a vacuum. Not even appraisers.

.

 

[hastalavista]

The appraiser has said: "Lenders are required by law (and are subject to severe penalties) to charge the same fee for the same service, unless they can show the service provided to a particular customer had additional costs (tract home vs. custom home estate in rural area)."
The appraiser provided a case study where two separate appraisals were done on two different properties across the street from one another - but the appraisal fees paid were different. In the appraiser's opinion, that was wrong.

The lender is required to charge the same fee if they are providing the service (with the exceptions/provisions you noted).
However, I do not believe they are under that requirement when engaging independent 3rd party contractors for such services. I see no violation here.

 

[Peter LeQuire]

I don't pretend to know lenders' requirements beyond what a lender/client has told me. That was that lenders have a very limited time between when an applicant is given a GFE and the time the estimated fees charged to an applicant/borrower can be changed, even if those fees are charged by third party providers. So much information available, it seems that the difficulty of an assignment can be determined with not a great deal of research, and an acceptable fee be negotiated during the process of accepting assignments.

 

[Meandering]

Yeah but Pete, sometimes it takes several days to find the cheapest appraiser. They just can't quote a fee without knowing what their take is going to be.

 

[Peter LeQuire]

Yeah but Pete, sometimes it takes several days to find the cheapest appraiser. They just can't quote a fee without knowing what their take is going to be.

Back in the day, most originators were attuned to transactions that were out of the ordinary, and those who survived were pretty adept at knowing where the opportunities for calamity were. A loan app falling apart because the loan originator doesn't have wherewithal to avoid pitfalls that should be anticipated from the time of the initial loan app probably deserves to fail.

 

[Meandering]

True,
But they cut the commissions of the LOs, so why would the "good" ones stay in those positions? But it's not an issue because the LO can't choose the appraiser, therefore all fees are up in the air until the AMC says what they are.
.