Anyone seen a slow down in orders the last month?

[J Grant]

Hybrids are probably a bit cheaper, but overall not much difference in cost or speed.

I suspected as much and likely will cost the same in case a reason is needed to switch to a traditional appraisal

Since there is a negligible difference in cost or speed, why would a lender order a hybrid? ( assuming they are not incentivized to do so by an AMC affiliation)

And since there is no, or only minor difference in cost to the consumer or speed, the entity's reason for offering this product is for consumer loans inane - why don't they just admit the truth that the hybrids profit the AMC and diminish control ( and income) for the appraiser and those are the reasons.
But they can't admit that, so they back door the reason with their own studies, which nobody can refute since nobody else sees the reports in question.

 

[alebrewer]

Since there is a negligible difference in cost or speed, why would a lender order a hybrid? ( assuming they are not incentivized to do so by an AMC affiliation)

Don't know, I'm not a lender.

And since there is no, or only minor difference in cost to the consumer or speed, the entity's reason for offering this product is for consumer loans inane - why don't they just admit the truth that the hybrids profit the AMC and diminish control ( and income) for the appraiser and those are the reasons.

Don't know. I don't work for the GSE's.

I already told you - I'm the president of one of the largest AMC's in the entire galaxy.

 

[J Grant]

Don't know, I'm not a lender.


Don't know. I don't work for the GSE's.

I already told you - I'm the president of one of the largest AMC's in the entire galaxy.

I don't work for the GSEs either.

But people can do the math and see the reduction of income to the appraiser, with a resulting gain of income to the AMCs, who will be the main ordering point for hybrids.
It is apparent that giving up the inspection means the appraiser gives up control over their own appraisal. It is simple to conclude that an AMC or lender can squeeze more production out of a staff appraiser, who no longer has to spend time going to an appointment and can take on more work in wider geographic areas.

 

[Dublin ohio]

For the last 3 weeks I have been getting around 4+ a week. That is almost up to the 20 per month that is my typical target. All from one lender that pays full fee and pays in 10 days

 

[Overimprovement]

We haven't seen many folks take advantage of the offerings yet. My suspicion is that the production folks just aren't trained (or accustomed to) looking at the AUS findings to see if they're even granted the hybrid/ACE offerings.

But it won't take long to catch on. Monkey see...

To the question about price difference--eventually the lenders will force the AMC's to lower their prices on hybrids. They aren't dumb. They may even advertise 'no appraisal cost' in their zeal to capture a continuing small market. Mortgage divisions of lenders are hurting now. They will force that pain onto the AMCs. If the AMC's can't absorb the lower total fees, they will go under.

 

[alebrewer]

It is apparent that giving up the inspection means the appraiser gives up control over their own appraisal.

That is patently incorrect. Please show me the section in USPAP that speaks about appraisers needing to physically inspect the property.

 

[alebrewer]

But it won't take long to catch on. Monkey see...

To the question about price difference--eventually the lenders will force the AMC's to lower their prices on hybrids. They aren't dumb. They may even advertise 'no appraisal cost' in their zeal to capture a continuing small market. Mortgage divisions of lenders are hurting now. They will force that pain onto the AMCs. If the AMC's can't absorb the lower total fees, they will go under.

Agreed - on both counts. I think that, as loan production folks become familiar with the offerings they'll avail themselves more often. I also think that, as appraisers build out their 'new' processes, they will become more efficient at performing hybrids and, as such, be able to tweak their fees to remain competitive. I also suspect that AMC's will be forced into lowering their margins for these products.

 

[J Grant]

But it won't take long to catch on. Monkey see...

To the question about price difference--eventually the lenders will force the AMC's to lower their prices on hybrids. They aren't dumb. They may even advertise 'no appraisal cost' in their zeal to capture a continuing small market. Mortgage divisions of lenders are hurting now. They will force that pain onto the AMCs. If the AMC's can't absorb the lower total fees, they will go under.

I don't agree with the above. /the lender does not pay for the appraisal; the borrower does, so whether the charge is $450 for an appraisal or $550 to the consumer, the lender does not benefit either way, and the price difference is not a deal breaker for a person needing to get a loan.

However, since the price difference between a hybrid and a traditional appraisal is not nonexistent or minor, there is no incentive for a lender who orders from their own panel to use a hybrid. Which the GSE entities might not like -, they throw shade on traditional appraisals, claiming that there are more errors or fewer reported conditions on traditional appraisals vs hybrids. That might make a lender consider ordering the hybrid, if the lender would believe such a thing.

 

[J Grant]

That is patently incorrect. Please show me the section in USPAP that speaks about appraisers needing to physically inspect the property.

I NEVER said USPAP stated the appraiser needs to physically inspect the property.
I said the result of hybrids with the appraiser is that they give up a measure of control over their own appraisal.

 

[Overimprovement]

Up until now, the reduction in work for many has been the result of fewer transactions (especially refis) overall--that's the 'duh' part. But also because the large AMCs are getting more and more appraisers on staff, and they gobble up all the decent orders. I've mentioned that at my peak I had well over 2 dozen decent clients. One by one, they switched to one of the big AMCs, and instantly, when they did, my orders disappeared. I did lose a few due to not hitting the sales price every time, but I didn't mind losing them. As I close out my appraiser career, I am down to ONE client. I did not ask to be removed from ANY of the other panels or lists, they simply stopped sending me orders. Even the ones where I had a good relationship with the local folks. They just didn't need my quality and price point for a 1004 any longer.

But now, once the need for a full 1004 basically disappears, I predict an even further big decline in 1004 orders. Not because hybrids are cheaper or faster, but because the AMC can make more money off of them. Even if a lender orders a 1004--the AMC will be quick to remind them that it MAY be eligible for a hybrid, and suggest they go back and check. They will tout the greater efficiency and speed (which does not exist), all while paying the poor sap staff appraiser the equivalent of $75 or so, while paying the 'inspector' $50 or so to take some pics. They might even lower the total fee to the lender just to encourage them to order the hybrid instead. If they were charging the lender $600 and giving $450 to the appraiser, now they can charge $500, while paying the two parties $125 or $150. More profit to the AMC, less cost to the lender, meaning more profit for them as well.

Again, I hope I am wrong for those here who want to continue in the business and need a good income--but I would be remiss if I didn't point out that you better be working on plan B, if not C and D...