Proof, We have a over supply of appraisers, we need PAREA

[George Hatch]

They didn't mean the banks compete on appraisal fees in that commercial!!!

Use your head, it meant to compete on interest rates or points. Those are the big-ticket items borrowers care about.

And I did not make the assumption that AMC are immune to a market downturn or competition. If any of them are folding now it is because of lack of volume. What makes you assume it has anything to do with the fees they charge lenders? The AMC's are suffering just the way any other business suffers when Res RE slows to a crawl. The AMC's are hurt by the waivers too. Without enough of a volume of appraisals to "manage", their business can become unstainable, especially because they do need at least some staff to operate and have to keep paying them.

You are grossly underinformed about what the CG market is like. I bid on every assignment that my clients approach me with and only some of them turn into assignments. Other assignments go to other appraisers and/or to other lenders who can offer a lower overall cost inclusive of the appraisal fees. Or sometimes can offer a faster turn. Our end of the business is every bit as sensitive to price as is residential. The only difference is in whatever the balance point is between supply and demand. We're not as grossly overserved on this end as is the residential market. However, that doesn't mean that our fees stay the same through thick and thin.

Now the appraisers who work on the specialty niches won't have as many competent peers so they are in a better position to hold the line, but for the rest of us these mortgage clients are also price sensitive. Less so with the attorneys and R-O-W assignments, of course but the SFR appraisers working those niches are getting the better fees, too.

If you weren't so far into your feelings on the topic you'd realize that there's no other way it could go on our end. How many times have you seen Terrell comment about the effects of competition on his book of work and the fees the assignments in his area are getting done at?

Fun fact, there are 30% fewer CGs in California in 2023 than there were in 2000.

 

[ucbruin]

A lender should care if the AMC is trying to get the cheapest appraisers, its just going to cause them problems.

How many decades have AMCs been in existence....
Doesn't seem that the lenders' sky has fallen during that time....

 

[glenn walker]

How many decades have AMCs been in existence....
Doesn't seem that the lenders' sky has fallen during that time....

The cheapest paid appraisers were the ones who worked in High Volume Fee Spit Shops. I knew of large ones who collected $350.00 and paid $75 to $150 to the appraiser who did the whole appraisal from start to finish,

The AMC actually freed thousands of appraisers to be able to out out on their own and start their own business and build new clients. The AMC also pays more to the appraisers than the old fee split shops ever did.

 

[J Grant]

They don't need that much staffings when it slows to a crawl, and when it picks back up they can attract people that would of worked at fast food otherwlse.

It will never pick back up enough for certain AMC's (imo). , Unless they diversify what they offer - their $ came from fee gouging and from appraisal volume. No matter how low they can drive a fee down, without sufficent volume they will start losing money, and this low volume will be somewhat baked into the future due to wxpanded WAIVER use , and only Certain AMC's are approved for hte hybrids and waivres. Taht is my opinon, anyway, not that I care what happens to any of them.

You are grossly underinformed about what the CG market is like. I bid on every assignment that my clients approach me with and only some of them turn into assignments. Other assignments go to other appraisers and/or to other lenders who can offer a lower overall cost inclusive of the appraisal fees. Or sometimes can offer a faster turn. Our end of the business is every bit as sensitive to price as is residential. The only difference is in whatever the balance point is between supply and demand. We're not as grossly overserved on this end as is the residential market. However, that doesn't mean that our fees stay the same through thick and thin.

Now the appraisers who work on the specialty niches won't have as many competent peers so they are in a better position to hold the line, but for the rest of us these mortgage clients are also price sensitive. Less so with the attorneys and R-O-W assignments, of course but the SFR appraisers working those niches are getting the better fees, too.

If you weren't so far into your feelings on the topic you'd realize that there's no other way it could go on our end. How many times have you seen Terrell comment about the effects of competition on his book of work and the fees the assignments in his area are getting done at?

Fun fact, there are 30% fewer CGs in California in 2023 than there were in 2000.

Please stop comparing residential appraisal with commercial appraisal bidding. If the fees are in the thousand and up range or even better than $500 range, they are there is no comparison. Residential appraisal fees are ranging avg $450-500- $600 to borrowers for regular orders and when no AMC is involved the appraiser gets all of it and when an AMC is involved the AMC takes as much as it as they can get. An appraiser in that scenario can end up with a $250- $350 Fee. Consider that when I started appraising back in 1990 the average appraisal fee was $275, which now with inflation comes out to be parox $600. The AMC's are unfairly competing with individual appraisers because the AMC typically does not charge a dime in cost to lenders, thus the lenders are eager to use them for free.

stop gas lighting me about feelings as well. This is economic, and the AMC;s have stripped massive amounts of money from appraisers into a redistribution of wealth to them that you defend, just pointing that out for a comparison to your getting so worked up about a better credit borrower having to pay a bit more in a rate.

I estimate that for a productive appraiser who is stuck doing AMC work due to lack of alternative volume (yes, that is a thing), they have lost easily between $300,000-$400,000 or more in fees over the course of a ten-year period. How is that for wealth re-distribution? Where is the outrage about that? lol compared to a dinky $40 or $50 more to a borrower who elects to take out a loan.

 

[George Hatch]

If you weren't being so dumb about the topic you'd realize that ANY fluctuation in the pricing of appraisals will be directly attributable to the supply/demand. And that ALL lenders compete with each other.

Why are appraisal fees different in L.A,, Seattle and NYC and Dallas and Miami? Why do fees vary so much by location? The reason for that is not the AMCs because they operate in all of those towns. They pay more in Seattle because they can't get it for less in Seattle, not because Seattle is somehow special. Why are fees different in 2023 than they were in 2020? The reason for that is not because the AMCs weren't working then.

As for "stripping the appraisers", you don't even sell what the AMCs sell because if you did you'd be able to compete by price with them for their own clients. That's why the only direct engagement clients you can get are the small lenders who deal in such low volumes that they're not worth an AMCs efforts.

I'm justifying nothing because there's nothing to justify. The economic interests of appraisers means nothing to most of these lenders. Right/wrong and fair/unfair has nothing to do with it. When appraisers compete, you lose. Everyone does. When the AMCs compete with each other, they lose. When the lenders compete with each other, they lose. None of this is personal - it's just business per market conditions.

 

[NC Appraising]

Why would they care? Because they compete with each other, in part on fees.

Yep. Go to lending tree for fun, all have estimated closing fees.

That is one of the biggest selling points in the Hybrid talking points. Lowers the cost for the borrowers.

I have been preaching this for YEARS on this forum. How can the AMC take advantage of the borrower like this? Charge zzz amount, find the cheapest appraiser and pocket the rest?

Now, the powers that be are complaining about lowering the costs for the borrowers. WTH? The AMCs have been screwing the borrowers for the last 8 years.

How many of the large AMCs contacted me in 2021 (the busiest for the mortgage market in history) for appraisal assignments? NONE!!!

That is why I called BS on the appraisal shortage. (of course, there are always exceptions...some markets, i know)

 

[J Grant]

You are grossly underinformed about what the CG market is like. I bid on every assignment that my clients approach me with and only some of them turn into assignments. Other assignments go to other appraisers and/or to other lenders who can offer a lower overall cost inclusive of the appraisal fees. Or sometimes can offer a faster turn. Our end of the business is every bit as sensitive to price as is residential. The only difference is in whatever the balance point is between supply and demand. We're not as grossly overserved on this end as is the residential market. However, that doesn't mean that our fees stay the same through thick and thin.

Now the appraisers who work on the specialty niches won't have as many competent peers so they are in a better position to hold the line, but for the rest of us these mortgage clients are also price sensitive. Less so with the attorneys and R-O-W assignments, of course but the SFR appraisers working those niches are getting the better fees, too.

If you weren't so far into your feelings on the topic you'd realize that there's no other way it could go on our end. How many times have you seen Terrell comment about the effects of competition on his book of work and the fees the assignments in his area are getting done at?

Fun fact, there are 30% fewer CGs in California in 2023 than there were in 2000.

So what? You choose to bid on these jobs. Nobody forces you to.

It still is very different than the AMC's control over a vast share of the market giving them enormous leverage over fees and orders that no individual commercial client has.

 

[NC Appraising]

If there is an oversupply of appraisers why would they get someone 3 hours away....lower prices...or this is one of the best appraisers in the state....I'll take a guess.

I will never understand this? All of my clients send me work within 15 miles from my office.

Maybe someone from a AMC can share why this is?

 

[J Grant]

I will never understand this? All of my clients send me work within 15 miles from my office.

Maybe someone from a AMC can share why this is?

Why would an appraiser want to drive 3 hours each way? Between the price of gas and the lost time ( 6 hours total just driving) it makes no sense.

 

[George Hatch]

So what? You choose to bid on these jobs. Nobody forces you to.

It still is very different than the AMC's control over a vast share of the market giving them enormous leverage over fees and orders that no individual commercial client has.

Is there a moral argument in there somewhere or are you just shaking your fist at the heavens and complaining about the weather?

IRL these businesses will exercise whatever alternatives they are not prohibited from exercising. It's no different than when you "strip" your business from one automaker to another, from one orange grower to another or from one appraisalware vendor to another. In each case the losers are in no position to be appealing to some self-serving power snivel that you owe them your business.