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AMCs - Are Appraisers paying fees for procuring assignments ?

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Riick

Thread Starter
Elite Member
Joined
Aug 14, 2007
Professional Status
Certified Residential Appraiser
State
Delaware
I just rec'd an order from an AMC (LandAmerica) requiring that
I collect their fee, and send it to them (overnight FedEx - no less)
then presumably wait to collect MY fee (some $120 less) from them.

Forgetting about issues of working with an AMC, and/or Fee levels,
(( or for that matter who gets to pay for overnight delivery via FedEx – an issue that I pointed out to them but remains unresolved))
it occurred to me that I would effectively be paying them a fee to procure the appraisal.

Below is what USPAP says;
Think they'd enjoy it if I included this as an additional certification????


29.PAYING FEES FOR PROCURING APPRAISAL ASSIGNMENTS

Question:
It has come to my attention that a local appraiser is paying a home inspection firm a $25.00 referral fee for each appraisal assignment the home inspector refers to the appraiser. Is it unethical to accept an assignment if the appraiser paid a fee for the assignment?

Response:
No, but accepting such a fee requires specific disclosures. The Management section of the ETHICS RULE states:


The payment of undisclosed fees, commissions, or things of value in connection with the procurement of an assignment is unethical. (Bold added for emphasis)

The Comment to the Management section goes on to say:

Disclosure of fees, commissions, or things of value connected to the procurement of an assignment must appear in the certification and in any transmittal letter in which conclusions are stated.
 

Walter Kirk

Senior Member
Joined
Jun 24, 2003
Professional Status
Licensed Appraiser
State
New Jersey
When you take an assignment from an AMC, the AMC is in effect hiring you. You are not paying the AMC to refer an assignment to you. It may be a difference without a distinction but the AMC retains the relationship with the client you just do all of the work and take all of the responsibility.
 

Webbed Feet

Elite Member
Joined
Feb 11, 2005
Professional Status
Certified Residential Appraiser
State
Canada
When you take an assignment from an AMC, the AMC is in effect hiring you. You are not paying the AMC to refer an assignment to you. It may be a difference without a distinction but the AMC retains the relationship with the client you just do all of the work and take all of the responsibility.

Mr. Kirk,

I disagree with you. No AMC has ever once proven to me that they are acting in any legal manner as an "Agent" of the third party that hired them to procure a real estate appraisal. Due to this lack of proof of agency, I maintain, and will always maintain, that it is the AMC that is the appraiser's "Client," and not the third party that is in reality the AMC's client only.

I have to compliment BofA in that they understood this concept, and when HomeFocus Valuations, BofA's AMC, ordered an appraisal, it was HomeFocus Valuations that was named as the appraiser's client.

If an engagement contract is demanding that I take money out of my pocket, that is not accounted for in my fee quote, that soley benefits the client and not I, and they will not give me the appraisal order if I refuse, they are demanding that I pay them a fee to obtain the work. Personally, I see the point and concept the O.P. is trying to make. Let me ask you this, what if the AMC demanded in an engagement contract that you pay their phone bill for the month for them or you don't get the order? At what point would you see the appraiser is agreeing to pay something outside of the appraiser's typical quoted fee in order to obtain the work?

Next, the AMC's will be demanding by contract we personally pay for the borrower's credit report, and then if that works that we have to go get the closing loan documents at a title company for them and pay out of our own pockets to over-night those to them as well.

Webbed.
 

Mountain Man

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Georgia
The last time I had a request like that, I told the HO I need two checks since the internet money broker went through XXXX AMC. I asked for 325 beans to include FedEx charges, and 125 beans to be made out to the AMC.
They changed their minds about using an internet mortgage broker, and called the local bank. I went ahead and did the inspection, and had the written request when I got back to the office.
 

Webbed Feet

Elite Member
Joined
Feb 11, 2005
Professional Status
Certified Residential Appraiser
State
Canada
Mr. Legget,

I completely support borrowers learning the truth about what is going on regarding purely profit motivations and the use of AMCs with how that affects the concerns, and pocket books, of the borrowers.

Webbed.
 

Bill_FL

Senior Member
Joined
Aug 23, 2002
Professional Status
Certified General Appraiser
State
Florida
Webbed:

I disagree with you. No AMC has ever once proven to me that they are acting in any legal manner as an "Agent" of the third party that hired them to procure a real estate appraisal. Due to this lack of proof of agency, I maintain, and will always maintain, that it is the AMC that is the appraiser's "Client," and not the third party that is in reality the AMC's client only.

What would you accept as proof? I am just curious. I dont have it in front of me, but I think the legal definition of an agent is something like:

A person authorized to act for and under the direction of another person when dealing with third parties.

So, what proof from an AMC would you reqire? It seems to me they are acting in that capacity.
 

3 Putt

Member
Joined
Aug 18, 2005
Professional Status
Certified General Appraiser
State
Ohio
Webster's defines procure as "to pimp".

A "procurer" as noted in the dictionary is a pimp. Interesting choice of words:)
 

Webbed Feet

Elite Member
Joined
Feb 11, 2005
Professional Status
Certified Residential Appraiser
State
Canada
Webbed:

What would you accept as proof? I am just curious. I dont have it in front of me, but I think the legal definition of an agent is something like:

A person authorized to act for and under the direction of another person when dealing with third parties.

So, what proof from an AMC would you reqire? It seems to me they are acting in that capacity.

Mr. Potts,

We could make this very simple. Next time a AMC refuses to pay you for your time and expenses, when they prematurely cancel an appraisal order on you after you have gone to the time and trouble of inspection etc.... Attempt suing the third party, that the AMC was supposed to be a legal agent of with the authority to cause that third party to become indebted, due to theft of services. Watch the defense made when you attempt to claim the AMC was an authorized "agent" of the third party with legal authority to represent the third party.

Or do this for a change. Just directly contract the third party and ask them to send to you, in writing, that the AMC is their legal "Agent" with the authority to instruct you, in everything regarding the assignment, and to indebt them on their behalf.

Give it shot partner. You'll fast find out they all deny that the AMC has the legal authority to legally represent them as their agent, and thereby create liability for the third party, on behalf of the third party. It will be "The AMC is hiring you, we are not. The AMC has (or had) no legal authority to place us in liability from an act of the AMC."

When a stranger comes to me and says; "I legally represent Mr. Jones, a person that will not be in contract with you." I want to see the paperwork that legally created that representation. I would be looking for a document that created a legal power of attorney. So you tell me, what would any intelligent attorney require before allowing themselves to be hired in such a fashion by someone claiming to legally represent a third party that wishes to remain incommunicato?

I'll have to ask an attorney about that. But I am sure it is one heck of a lot more than just bending over and blindly placing a third party name on legal documents as the attorney's client.

Webbed.
 
Last edited:

Ray Miller

Elite Member
Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
Just how many appraisers act as the water boy for the AMC?? You want the job you do our bidding!!!!! You send us all the money and when we get good and ready we will send back to you what we feel your are worth!!!

I still say they are acting like employers.:new_multi:
 
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