The LAW says we are to be compensated at a "customary & reasonable" rate.
Yes it does, but the law doesn't specify what C & R is. Why is that? The writers of DF don't give two poops about appraisers. They wanted to create a massive new bureaucratic agency that had no oversight to regulate the banks and that's exactly what happened. They left thousands of pages of regulation to be written at a later date, including what C & R is. Why did they do that? Because, even the writers of DF knew they couldn't possibly determine what a C & R fee is for all the different real estate markets, all the different types of appraisals, all the different types of businesses that provide appraisal services...etc.
One self serving side has zeroed in on the customary part and tried to manipulate that to the point that the second part is completely ignored.
When you go to a car dealership, do you pay full sticker price or do you price shop and try to get the best deal possible? AMC's are basically doing the same thing. The difference between most car dealers and appraisers's is that the car dealer knows how much they need to charge for their product to be profitable; most appraisers have no idea what they are worth. While I am not a fan of AMC's, I understand they are trying to run a business and would like to make as much profit as possible. If there are appraisers out there willing to accept "low fees", then that is the C & R fee to that appraiser, otherwise they would reject/counter the AMC's offer.
Here's the thing about C & R; it's different for everyone. If someone can thrive in a "low fee" environment, then good for them. They are free to accept those "low fees" just as other appraisers are free to reject those same "low fees". As long as enough appraisers are accepting "low fees" to meet demand, then those are C & R fees for that market. Appraisers set C & R, based on the fees they are willing to accept. Any business would be foolish to pay more for a product or service than market rates.
Now it is necessary to take actions that move the pendulum of balance back toward the middle; or even the other side, if greater services are now required than when C&R was postulated and adopted into law...
As appraisers leave the profession, supply of appraisal services is beginning to tighten a bit in some markets. The more business savvy appraisers are beginning to challenge the AMC's and ask for higher fees and longer turn times. The pendulum is beginning to swing. However, a price floor (minimum fee) is not the answer. The price floor will become the price ceiling. $600 for that cookie cutter in a subdivision will be equivalent to $600 for a super complex high-end home in the mountains. The AMC's and regulators won't see a difference, because appraisals are all the same to them. They don't understand what goes into developing an appraisal. They will say, "The law says I have to pay you $600, so take it or leave it." Those same appraisers accepting "low fees" today, will be the one accepting that assignment. The appraisers that felt that $600 was below C & R, will be upset...just like we have today.
If the door to a price floor is opened just for GSE appraisal services, how long before it creeps into other area's of appraisal services? I certainly don't want a government bureaucrat determining how much my time is worth. That has not worked out well for doctors in regards to Medicare and Medicaid with many doctors no long accepting those patients because the government regulated reimbursement rates are often below the doctors cost.
When price goes up, so does supply, but demand goes down. By setting a price floor for appraisals, we would be causing the supply of appraisal services to increase and demand of appraisal services to decrease (this hurts appraisers). We would also be causing prices to consumers to increase (that hurts consumers). A price floor will do more harm than good.
If you truly want to help appraisers, then focus your time and energy on getting government out of the way. I understand that we must have some regulation to maintain order in an economy, but we currently have too much regulation. We certainly don't need a federal minimum fee mandate. Let the states handle appraisal regulation; they are better equipped to regulate on a more local level. And instead of having the government force people to pay us more, focus that time and energy on educating appraisers. Many have no idea that they can ask for a fee and TAT increase and will get it in many instances.
). I'm not trying to play "gotcha". If that is the case (Washington has set a minimum) that would be huge news. My specific interest would be to see how they set the rates. You've laid out your rationale in your first post; I was wondering how they came up with a figure if they've set a minimum.