3.6 Crunch Time

[ilsindaco2628]

Those numbers would be interesting to know. The margin between what the lender is willing to pay to what the AMC is giving the appraiser.

Another interesting coincidence. The lender has a lot of choices in regards to AMC's.... this shows they're not dedicated to one providing a superior service, but what they're willing to pay because they have to put that "appraisal fee" in the loan docs. Hiding the service fee for the AMC within the appraisal fee, the appraisal fee probably looks "outrageous".

I can help with that. Some states are required to disclose all fees... Fee paid to bank, fee paid to AMC, fee paid to appraiser.

Here's one from an order I have.

This particular AMC is pocketing $200

 

[Vermonter]

The timing of this transition could hardly be worse for appraisers. The volumes are down and everyone is already starving.

Really depends on if all those saying they're not doing 3.6 actually follow thru. Tend to think many that say they're not doing 3.6 are just venting and will reluctantly get on board.

Real world attrition will probably be somewhere in the middle. Those that were already on the fence about getting out will see this as a sign, those that don't have a better option will stick around and deal with it. The latter will realize that yes, it's different, but in no way insurmountable.

 

[Non Sequitur]

I see some talking about appraisal waivers.

I started doing property data collection on the side... and a lot of lenders are still requiring PDC inspections even with an appraisal waiver. That gets them a floor plan and a 360 view of every room in the house... I have been doing this for 6 months and am learning slowly what they do with these inspections.

They are using the 360 photography to find the smallest issue ... molding that needs paint, a light switch without a plate/cover, discoloration on a wall/ceiling... and forcing owners/sellers to make a number of repairs before approving a loan.

Thanks for the boots on the ground play by play.

What you describe is what I'm seeing too. I test drove a couple of hybrids, full PDCs with Matterport 3D. QC came back and asked me to comment on a sheetrock tape line they noticed on the vaulted ceiling in the Living room. During another assignment QC ran me through the gauntlet because they noticed above ground power lines servicing the subject but two of the comps had below ground power lines (urban area built out for decades).

IMO the desire to account for the fall of every sparrow is why they want to train up the next generation with zero field experience through Practicum and PAREA. Noobs won't know any better and will be happy working from home or behind a desk for $17 an hour thinking every little blemish needs to be pointed out and reconciled.

 

[NC Appraising]

 

[djd09]

yeah the 15th st parties are sickening along with their nda's...but do not fret they will reap what they have sown

 

[PeterPetrelli]

My latest thoughts regarding 3.6

-I just had an AMC ask me if I would do a 3.6 single family purchase with rental comparables (previously 1004 w 1007) for $325.
I told them $650 and never heard back.

- I use TOTAL. It IS getting better... mixed with me having done more 3.6 work I have cut down on reporting time however I have only completed single family and condo reports. No exterior, no 2/4 unit (TERRIFIED OF THIS) and no supplemental forms (rental comps, operating income statement). Having a functioning mobile app will certainly cut down on time back at the computer but I haven't tried it yet for 3.6.


-All I hear from my AMC contacts is that appraisers are not ready, many haven't completed any 3.6 orders and say they will "figure it out when it launches" which I have tried to use to my advantage. I am trying to be opportunistic and have enough experience where AMCs would rather auto assign me the work knowing it will get done in a timely fashion versus give to to another appraiser who is going to try to figure it out on the fly. HOWEVER the AMC model of sending out quote requests to find the fastest and cheapest appraiser is going to further complicate things. We're all going to have to learn how to describe the 3.6 debacle to realtors who will have no idea why their purchase appraisal is going to take 2 weeks to turn around after inspection.

I am still holding out hope this will get delayed again.

That's unreal... I don't care how easy the property is, I wouldn't even do a 1004 legacy form for $325 let alone a rent schedule to boot. And they want it done in 3.6??

Ive said this before but Im going to keep saying it. For those of us who intend to do 3.6 reports (even if only, eventually), we need to hold fast to restructuring our compensation levels. I've been waiting for this for years... now is our opportunity and we need to stand firm with significantly higher fees. When I first started ~25 years ago, I charged $350 for a 1004... and these clowns just offered you less than that for more work (the old reports were so much less work) AND an additional analysis form. These people are out of control. I see the fees they're charging lenders. In my area they charge anywhere from $550 to $695 for a standard appraisal... with 1007? has to be another $100-150 and for a 3.6 report? I don't even know...

Im quoting $750-850+ for 3.6 reports and I want every appraiser to know that. We don't talk about fees a lot but we need to, now. I saw a post from another appraiser that has completed 12 of them and is charging $700 on average. Honestly, $700 should be the bare minimum for the amount of work required on these ridiculous things. I think this needs to be the absolute floor... AND remain there even after efficiency improves.

 

[Surf Cat]

Im quoting $750-850+ for 3.6 reports and I want every appraiser to know that. We don't talk about fees a lot but we need to, now. I saw a post from another appraiser that has completed 12 of them and is charging $700 on average. Honestly, $700 should be the bare minimum for the amount of work required on these ridiculous things. I think this needs to be the absolute floor... AND remain there even after efficiency improves.

Here's the problem though..... the powers that be that designed this thing didn't think of the ramifications of costs.

$600 to $800 is what's on the loan docs now. With appraisers wanting $700 to $800 per for the 3.6, the rates for the appraisal fee on the loan docs (which hide the fact that it's also the AMC service fee because it's bundled) are going to have to go up. Appraisal fee on the loan docs now has to be $1,200. That would probably send some borrowers through the roof.

That is, if the lenders still want to continue to pay nothing for Appraisal Services when in the past they used to have appraisal staff. Something's got to give.

 

[PeterPetrelli]

Here's the problem though..... the powers that be that designed this thing didn't think of the ramifications of costs.

$600 to $800 is what's on the loan docs now. With appraisers wanting $700 to $800 per for the 3.6, the rates for the appraisal fee on the loan docs (which hide the fact that it's also the AMC service fee because it's bundled) are going to have to go up. Appraisal fee on the loan docs now has to be $1,200. That would probably send some borrowers through the roof.

That is, if the lenders still want to continue to pay nothing for Appraisal Services when in the past they used to have appraisal staff. Something's got to give.

I don't disagree... and that "give" should not be us...
Who is the most useless variable in the equation? The AMCs... that's why it's bad news for them. They really dont bring enough to the table to command the fees they are taking.

 

[Surf Cat]

I don't disagree... and that "give" should not be us...
Who is the most useless variable in the equation? The AMCs... that's why it's bad news for them. They really dont bring enough to the table to command the fees they are taking.

If AI is going to send people packing..... the AMCs are definitely the ones to go!

 

[Fritz in NY]

Your way to low $$ for that estimated quote. I receive over $ 700 for all my SF in New York 2.6. Keep in mind with the 3.6 "Basic" report, lenders and AMC's will ALWAYS ask for more info, photo's, graphs, comments. extra listings, comps. It makes them feel superior for their expanded SOW. It could go on and on with additional requests.