The Appraiser Shortage Myth Part 43

[Eli]

Most, will collect the Appraisal fee from the Borrower after the Lender sends the order over. Usually, the collection is done via Credit card. AMCs as a general rule do not wait for payment from the Lender/Client - they have the fee in hand before placing the order with the Appraiser.

I didn't know that. Thanks.

 

[gregb]

The one AMC I am familiar with (a friend is the chief appraiser for the lender) bills the lender once a month, but is not paid in advance for assignments it is processing.

 

[Terrel L. Shields]

Walmart sells and pockets a vendors money weeks before they get paid and any returns are clawed back as well. Wally World banks don't pay anyone in advance. Ditto Amazon

 

[J Grant]

The one AMC I am familiar with (a friend is the chief appraiser for the lender) bills the lender once a month, but is not paid in advance for assignments it is processing.

Greg, do you know. (would your friend tell you), when the AMC bills the lender once a month, do they bill the lender the same amount borrower paid for the appraisal of that property? Or do they bill the lender for an agreed on charge for each appraisal? (if tht charge differs from what buyer paid, is lender keeping the difference...such as buyer paid $550, AMC bills $500)

Or does the AMC simply bill the lender a flat fee amount for each appraisal they process such $150 per order.

Does the lender allow AMC to pay whatever fee the AMC wants/can obtain from each appraiser, or does the lender specificy, appraisers for our work to get paid $350 in an area?

I presume an AMC if they work for several lenders might have a different agreement with each lender. It is hard to find out first hand information coming direct from an AMC it would be fantastic if he could share though I understand he may not be able to or you may not want to put him in that position..

 

[Terrel L. Shields]

Or do they bill the lender for an agreed on charge for each appraisal?

"Averaging" is what I think they call it in banks. Flat fee per assignment, AMC wants you to do same, MH or Mansion. One fee. Some banks do this, some do it on bid

 

[gregb]

This is a relatively small, local bank and the AMC is AMSA. This is a cost+ AMC, who bills the lender between $100 and $150 per assignment. The loan officers in the bank would actually prefer for the bank to order and manage the appraisals (due to delays in placing orders etc) but so far, the bank is not willing to hire the staff to manage the appraisal process. It may not be cost-effective for the bank to do so; however, three other bank clients who are larger, more regional, do have appraisal departments with the staff so that they do not use an AMC. I have been very lucky to escape the AMC nightmare.

 

[J Grant]

This is a relatively small, local bank and the AMC is AMSA. This is a cost+ AMC, who bills the lender between $100 and $150 per assignment. The loan officers in the bank would actually prefer for the bank to order and manage the appraisals (due to delays in placing orders etc) but so far, the bank is not willing to hire the staff to manage the appraisal process. It may not be cost-effective for the bank to do so; however, three other bank clients who are larger, more regional, do have appraisal departments with the staff so that they do not use an AMC. I have been very lucky to escape the AMC nightmare.

Thank you. Those who work on a cost plus basis typically have a set fee schedule for appraisers in a regional area they pay ( can you find out it this is the case?

The fact that this lender and AMC are using cost plus with TRID in place, as well as others doing the same, shows erecting the TRID is the barrier to cost plus as bogus aka the false narrative of we have to get rid of TRID for cost plus to work.,

Trid compliance might be more of a challenge to implementing for a larger AMC; surely they can figure it out it's not rocket surgery.

 

[J Grant]

Usually if cost plus is implemented it means along with AMC charging a flat rate per order to lender, the AMC also pays a uniform fee to appraisers in a region ( that's what feedback so far is and what I have experienced. This immediately wipes out some of the problems present with AMC's who are not on cost plus.

Cost plus AMC : pays $350 an appraisal in a regional area. Appraisers can choose to work at that fee or not. If they choose to however, from that point on the selection of appraisers is more equitable and metrics that are centered around competence . Since a lower fee is no longer part of the decision to select, the selection of an appraiser for assignment would be based on quality of work, reasonable level of service, and which appraiser is better suited for a particular assignment.

With cost plus in place and a uniform fee paid, choosing among appraisers based on their comparative fees is not in the mix. Pitting appraisers against each other to bid for a regular order is no longer in the mix. Deciding ty a tie break with fee as the decider is no longer in the mix. Assigning 15 a week to a lower fee provider appraisal while well qualified appaisers on the panel get nothing or 2 a month is longer in the mix.

 

[gregb]

The AMC sends order thru appraisal scope portal; appraiser options are to accept, accept with conditions (fee and/or tat) or decline. Usually the tat is one week, never 48 hours. Fee offered varies with complexity of the assignment. The one situation where I automatically decline an assignment from the AMC is when there is a local rogue agent involved, who in the past has acted unprofessionally.

 

[Eli]

The AMC sends order thru appraisal scope portal; appraiser options are to accept, accept with conditions (fee and/or tat) or decline. Usually the tat is one week, never 48 hours. Fee offered varies with complexity of the assignment. The one situation where I automatically decline an assignment from the AMC is when there is a local rogue agent involved, who in the past has acted unprofessionally.

I have done it too. You can't do that with VA unless it is an emergency. But the VA will tell that agent or anybody else to go jump in the lake.

To sum it up, they don't play with appraiser independence. In Atlanta, they are locked and loaded with talent.