When Customary Fees Become Unreasonable

[Pilgrum]

I am totally against ANY governmental interference in my business. It is bad enough with what there is now. Setting fees, minimum or maximum, is too much.
Socialism is a FAILED experiment.

 

[Terrel L. Shields]

Regulating appraisals is a failed experiment but you and I are hip deep in it...

 

[Michigan CG]

This thread is exactly why I have no support for unions/guilds. Everyone thinks they are entitled to something.$550 for a simple 1004 that can be written in five hours? $100/hour for simple 1004's? Very few professionals make $100. I like how the proposal talks about plumbers making $130/hour. That $130/hour does not go to the plumber on the job. That $130 also pays for the storefront/office/warehouse, the plumber's van, all the tools, the inventory they carry, the secretary who schedules the appointments.

This idea is almost as ludicrous as the fast food workers wanting $15/hour.

 

[sandpiperapp]

Most appraisers with an established business model that does not depend on AMC work, are reluctant to establish fixed fees. Good for them. I applaud their hard work and good business sense that got them there.

I am lucky that I am also no longer dependent on AMC work. I gotta tell you though, the fixed fee for VA work has worked out quite nicely for me. I am once again able to pay my bills by providing quality appraisals with good service.

For those with established business plans not dependent on lending work from AMCs, they can afford to talk about supply and demand, and independent business models. The truth is that for the bulk of appraisers that DO depend on lending work from AMCs, they have not been able to compete fairly because the AMCs have controlled and manipulated the market. Their control does not let the market for appraisal services work freely as a true market should. Most boots on the ground appraisers that are dependent on lending work and as a result, forced to work with AMCs, need a hand(voice) in helping them negotiate fairly with the lenders and their pet AMCs.

I think a national voice would be helpful to many hard working appraisers that were not able to establish a business model away from lending work and AMCs. I also do not think that a national voice would harm the established appraisers and their businesses.

Lets face it, many good people (appraisers) need something to help them. Just saying no to AMC work is not realistic for many.

 

[hastalavista]

Lets face it, many good people (appraisers) need something to help them. Just saying no to AMC work is not realistic for many.

We should face this because it is, unfortunately, true.
The question always is, what is the best way to effect positive change in regard to fees and turn-times. A national (or regional) fee is one way with regard to "fees", I just don't think it is the best way or a practical way.

We are not minimum wage employees. A minimum hourly rate for employees (while I don't even like that) has some reasonable basis behind it.
We are trained professionals. Current requirements include a college degree along with basic technical training and continuing education requirements. This is not a segment of the employment market that needs a "minimum" wage-like standard.

If appraisers want to join a union and try to organize themselves to obtain a higher fee, that is their prerogative. There are other ways to obtain higher fees and many on this board (yourself included, congrats BTW) have achieved that objective.
But a law to set fees for appraisers? I cannot endorse that without endorsing a law to set wages for a lot of other sub-classes of the employment market. And since I don't endorse it for those other professions, I cannot endorse it for ours.

 

[sandpiperapp]

I do not know the best way to accomplish the goal of a fair fee for a good report.

I do know that working with the fixed fee established by the VA works for me. Let me say that emphatically, IT Works For Me.

My fixed fee with the VA has not harmed any other appraiser's business model

I am sure many, many appraisers, good hard working non skippy appraisers, that depend on lending work would likewise benefit.

Denis, you do not need to endorse it, you have your own business, as I have mine and Mich CG has his. You don't need to stand in its way, either.

 

[hastalavista]

Denis, you do not need to endorse it, you have your own business, as I have mine and Mich CG has his. You don't need to stand in its way, either.

I appreciate your sentiment. If I were neutral on the issue, I wouldn't oppose it. I'm not neutral; I don't think it is a good idea and I don't think, in the long run, it is beneficial.
So, count me in the opposition camp!

 

[Michigan CG]

A good friend has a daughter who works at Great Clips and gets paid a low hourly wage plus tips. Another gal I know works in a shop where she gets the whole fee and pays rent to the salon owner. I think that my friend's daughter deserves to be paid $40 per haircut instead of $8 hour, it is only fair. We need a new law.

My wife is a nurse practitioner and on a daily basis prescribes medications, discharges people from the hospital and does other things that doctors sometimes do. It is not fair that she does not get more pay for the doctor things she does; it isn't fair. We need a new law.

The people running the amusement park rides at Disney World are operating heavy machinery, they should get wages like heavy machinery operators at construction sites. We need a new law.

Regulating wages is manipulation of the system. Regulating supply and demand is manipulation of the sytsem.

 

[sandpiperapp]

Mich CG, I would agree with you given a level playing field, it's not. You me and a bunch of other appraisers were good enough, smart enough, or in my case, lucky enough to do well given the current state of the valuation industry

I think this idea of a fixed fee is in response to the lenders and AMCs manipulating the system. Now it needs to be manipulated back to restore some sort of market equilibrium.

 

[Mike Kennedy]

The fee charged by a Lender to it's borrowers to obtain an appraisal IS the appraisal fee/C & R.

Whether a Lender chooses to discount, or entirely waive, it's usual fee during a special discounted promotion or not - the lender's "usual" fee charged IS " C & R".

100% of the "usual", non-discounted appraisal fee charged to a borrower is earned by an Appraiser (if not a direct employee) who completes and delivers the appraisal report contracted for by the Lender.

Anything less is theft of services.