Bedroom Count?

[Dublin ohio]

Chase ordered the appraisal, and the appraiser was local, but I am told big banks farm out work at a fee of $450 to me, but only pay about $150 to appraisers while local lenders pay higher and appraisers know the market "better'.?

I was actually asking what type of local "lender" you were referring to. Yes, big banks farm out the appraisal. But some local banks also do the same. Might even use the same appraiser since the appraiser was local. I would kind of doubt that the appraiser only got $150.00. But it is possible. You already stated that you did not pay for the original appraisal. So you really do not know who was paid what.

 

[Michigan CG]

I am told big banks farm out work at a fee of $450 to me, but only pay about $150 to appraisers while local lenders pay higher and appraisers know the market "better'.?

This is a complicated subject but since you brought it up I will explain it a little. Big Banks and a lot of other lenders use AMCs (appraisal management companies). The AMCs send out bid requests to see who they can find to do the report for the lowest price and in the fastest time, price being most important. In the last two years it has gotten worse as the AMC business model is very competitive and some are going out of business or merging.

$150 is very low and is typically an appraisal firm that takes low-paying AMC work and then further splits it with the appraiser who is an employee. They offer garbage benefits to the appraiser but promise steady work.

In my market the AMCs are paying $325-$350 from what I have heard and charging the consumer $500-$600.

Working for AMCs is an awful existence for appraisers as they are very high maintenance and have no loyalty. My residential work is for direct lenders where the fees are much higher and I can do the job correctly. The guy working for $150 does not have time to do a good job as he is starving and needs to do 2-3 a day; I can do over one a day but never two a day.

 

[Tim The Enchanter]

The $150 appraisal. You get what you pay for. I bet they are fast too.
A professional appraiser that knows their stuff and is not just tossing out fast trash will be more like $400 - $600, for a "normal / conforming" ie not weird, property.

 

[KStoFL]

Got it .I have no idea what appraiser was paid. I was just told the big banks theory by realtor.

 

[CenterTim85]

I feel like I need a shower after viewing this thread. . .

 

[TRESinc]

Got it .I have no idea what appraiser was paid. I was just told the big banks theory by realtor.

that won't stop people on here from making assumptions based upon little to no evidence. i would be utterly amazed to find out an appraisal with interior inspection was performed for $150 for your purchase. that is 30-50% below what the lowest reported offers made to appraisers has been on here.

the way i see it you have a couple choices:

negotiate with the seller to bring the price down. doubt this will happen based upon the information you have presented us about the sellers but crazier thing have happened...

bring cash to the closing table to cover the difference between the price and what the lender will loan you. if you really, really want the house this may be your only (best) option of securing the purchase.

walk away and live to fight another day. as bmac posted there will always be another house. it might not be tomorrow and it might not be across the street from this one but there will always be another.

fwiw i bought my house about 4 years ago after looking at 25+ houses over a year. house shopping sucks! everyone other than the appraiser will lie and tell you what they think you should hear to achieve the goals they want, and you have experienced this with both agents telling you that you should pay more than the only independent party says. remember, as an appraiser i don't care what the house sells for, my fee is static and has already been established by the time i look at the house. i will still analyze the contract and use it as a data point but the contract price does not influence me to any degree.

 

[KStoFL]

that won't stop people on here from making assumptions based upon little to no evidence. i would be utterly amazed to find out an appraisal with interior inspection was performed for $150 for your purchase. that is 30-50% below what the lowest reported offers made to appraisers has been on here.

the way i see it you have a couple choices:

negotiate with the seller to bring the price down. doubt this will happen based upon the information you have presented us about the sellers but crazier thing have happened...

bring cash to the closing table to cover the difference between the price and what the lender will loan you. if you really, really want the house this may be your only (best) option of securing the purchase.

walk away and live to fight another day. as bmac posted there will always be another house. it might not be tomorrow and it might not be across the street from this one but there will always be another.

fwiw i bought my house about 4 years ago after looking at 25+ houses over a year. house shopping sucks! everyone other than the appraiser will lie and tell you what they think you should hear to achieve the goals they want, and you have experienced this with both agents telling you that you should pay more than the only independent party says. remember, as an appraiser i don't care what the house sells for, my fee is static and has already been established by the time i look at the house. i will still analyze the contract and use it as a data point but the contract price does not influence me to any degree.

Thank you for all this. Do you see point of another option being ordering a second appraisal like sellers want?

 

[TRESinc]

Thank you for all this. Do you see point of another option being ordering a second appraisal like sellers want?

as an appraiser, nope

as a consumer. maybe. if i want that shiny new car and dealer A will only sell it for $5,000 but dealer B will sell it to me for $4,700 i am going to go with dealer B. there is always a chance that the second appraisal will come in higher, but then you have to ask yourself if you are willing to spend (borrow) more money and potentially be underwater from the start. it has happened in the past but asking for a 10% increase is a lofty goal.

if i were in your shoes the first thing i would do would be to go to www.ASC.gov and look for a local appraiser. call them, talk with them and see how you feel about them after that. i would personally want someone with a minimum of 10 years experience in that specific market, and someone who has experience with higher priced housing. spend a few hundred dollars and have them review your appraisal. that way you can have a second opinion from another disinterested and unbiased party about the value of your house and if you are way off or the sellers are. $400-500 is a drop in the bucket compared to a $600,000 purchase. my dad will drive 10 miles out of his way to save $0.20 on a gallon of gas

 

[KStoFL]

as an appraiser, nope

as a consumer. maybe. if i want that shiny new car and dealer A will only sell it for $5,000 but dealer B will sell it to me for $4,700 i am going to go with dealer B. there is always a chance that the second appraisal will come in higher, but then you have to ask yourself if you are willing to spend (borrow) more money and potentially be underwater from the start. it has happened in the past but asking for a 10% increase is a lofty goal.

if i were in your shoes the first thing i would do would be to go to www.ASC.gov and look for a local appraiser. call them, talk with them and see how you feel about them after that. i would personally want someone with a minimum of 10 years experience in that specific market, and someone who has experience with higher priced housing. spend a few hundred dollars and have them review your appraisal. that way you can have a second opinion from another disinterested and unbiased party about the value of your house and if you are way off or the sellers are. $400-500 is a drop in the bucket compared to a $600,000 purchase. my dad will drive 10 miles out of his way to save $0.20 on a gallon of gas

Thank you! I did just this and hopefully one will get back with me before end of week, which is when sellers want us to let them know if we are getting appraisal ordered. I'll circle back on outcome !

 

[Tim The Enchanter]

f i want that shiny new car and dealer A will only sell it for $5,000

What kind of shiny new car, and where do I get one for $5,000?