Appraisal Institute Controversy

[Tiffany Gibbons]

Not really responsive to the question I asked. PAREA is the only element that TAF has control over, and the impetus for that arguably started at the AI . As I understand it the AQB started working on "alternate forms of experience" in 2015. PAREA was incorporated into the Qualifications criteria in 2021. The topic was addressed at length over a period of several years before the AQB committed to it.

But you were already aware of all that before you mentioned it, right?

The others you are complaining about are part of the decision making at the lenders and GSEs, not at TAF. Speaking of the lenders, they're the reason trainees working off of "did not inspect" Supervisors got ignored back when the market went bust in 2007; not the GSEs and not TAF.

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Soooo,

What AMC-biased changes do you attribute to TAFs actions with Appraisal Standards and Appraiser Qualifications?

George, I do not work for AMCs. I wish all appraisers would have just chosen not to work for AMCs, but that is not reality, unfortunately. Some appraisers have known nothing else. Frankly, I don't know what TAF is working on and I don't care. I can't even watch their dumb videos. Bye.

 

[George Hatch]

Fair play and I won't be bothering you with it again. I was just really repeating the same question that I've been asking the other critics who think there's a corrupt AMC-dominated bought-and-paid-for conspiracy between the ASC, TAF and the GSEs to screw the fee appraisers over.

 

[Mejappz]

For anyone interested in the corruption at TAF and the AI the two Sasha Jones exposes are must reads. Along with Jermey Bagotts book

 

[RCA]

Okay, so what changes to appraisal standards or appraiser qualifications at TAF do you think have been biased in favor of AMCs and against fee appraisers? The others you me-too for apparently have no answer for that. Do you?

That's not the issue.

The issue is that the AMCs were created in the first place, that the AMC clients are the more generous paying clients and the appraiser clients are fat pig selfish AMCs. That is a structural deficiency.

 

[Zoe]

Fair play and I won't be bothering you with it again. I was just really repeating the same question that I've been asking the other critics who think there's a corrupt AMC-dominated bought-and-paid-for conspiracy between the ASC, TAF and the GSEs to screw the fee appraisers over.

Sir many connections have been pointed out to you. You are not naive.

 

[Tiffany Gibbons]

Not really responsive to the question I asked. PAREA is the only element that TAF has control over, and the impetus for that arguably started at the AI . As I understand it the AQB started working on "alternate forms of experience" almost 20 years ago. "Practicum" alternatives were included in the 2008 criteria, long before any such courses were developed. As of 2015 we didn't have a shortage of appraisers of any type that inhibited the AMCs ability to find cheap appraisal fees. PAREA was eventually incorporated into the AQB Qualifications criteria in 2021. The topic was addressed at length over a period of several years before the AQB committed to it.

But you were already aware of all that before you mentioned it, right? Of course you were.

The others you are complaining about are part of the decision making at the lenders and GSEs, not at TAF. Speaking of the lenders, they're the reason trainees working off of "did not inspect" Supervisors fell out of usage back when the market went bust in 2007; The GSEs and TAF had nothing to do with that turn of events. Same goes for "chad", since he's adding his me-too to your non-answer.

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Soooo, back to the question and hand, and lets see if you can come up with something other than "it's not my job to teach you, you should just know". Feminist college students can get away with that when they get caught running their mouths off things they don't actually have a personal opinion on, and you ain't no 20-yr old junior at Sarah Lawrence.

What AMC-biased changes do you attribute to TAFs actions with Appraisal Standards and Appraiser Qualifications?

Do you have a college degree? If so, what is it in?

 

[Zoe]

I'll say it one more time. If fees would have been separated on truth in lending disclosures as originally intended, then AMCs would have been competing against each other to give the lender the lowest fee they could for the AMC fee. Lender would have paid AMC directly for their services.

 

[Zoe]

I understand not all lenders use AMCs. I know that. Some engage directly with the appraiser. I know that.

 

[gregb]

The AMC's incestuous infestation and destruction of the fee appraisal world is unprecedented. https://appraisersblogs.com/exposin...es-corrosive-influence-on-the-housing-market/

Exposing the inner workings of these predatory AMCs and their corrosive influence on the housing market.
Cindy Chance’s recent comments about the concerning practices of some appraisal management companies (AMCs) have struck a chord with many in the real estate valuation industry. Chance is shedding light on the troubling ways in which certain AMCs have come to wield significant power and influence over the appraisal process, often to the detriment of both appraisers and the public. The growth of AMCs in the wake of the 2008 financial crisis was driven by the misguided belief that they could help “ensure the integrity and independence” of property valuations. However, the reality has played out quite differently, with many AMCs prioritizing profit margins over quality and fairness.

These predatory AMCs have created a race to the bottom when it comes to appraiser fees, driving down compensation while simultaneously increasing their own fees charged to lenders and consumers. The lack of transparency around AMC fee structures means the public has little visibility into how their hard-earned money is being diverted away from the actual valuation work. Chance rightly points out that a well-functioning market requires transparency, and the current AMC-dominated model falls woefully short in this regard. By exposing the inner workings of these predatory AMCs and their corrosive influence on the housing market, the CFPB’s initiative represents a vital opportunity to enact real, meaningful reform. Appraisers should take this opportunity to participate in the public comment process and help catalyze transformative progress towards a more transparent, accountable, and consumer-friendly mortgage landscape – one where their role as impartial, objective professionals is truly respected and protected, not exploited for the financial gain of unscrupulous intermediaries. To comment click here.

From Cindy’s desk?


Last week I hit a nerve with some comments about the value of appraisers and predatory AMCs not respecting their value. I got many notes from appraisers who were supportive and a few from AMCs, one of which was downright upset. And here I thought they would agree with me! I was thinking I was careful to call out predatory AMCs only, but apparently the number with ethical, transparent practices may be smaller than I imagined.


How did AMCs become such a powerful market player, and how have they affected real property valuation?

AMCs or “appraisal management companies” function as an intermediary between banks and appraisers to “ensure the integrity and independence” of the appraisal process. The use of AMCs by lenders grew greatly following the financial crisis of 2008 and Andrew Cuomo’s overreaching attempt to universally apply his “Home Valuation Code of Conduct.” The theory was that AMCs would streamline the process, and ensure quality control and compliance. What has actually happened? AMCs have created a race to the bottom in terms of fees paid to professionals and time spent on appraisals. Why? Because there was money to be made in being in the middle and there was nothing to stop AMCs from raising their fees while they reduced the fees they paid to appraisers. The public is not aware of this because AMCs do not need to disclose their fees—something the Appraisal Institute has long supported. The regulatory oversight of AMCs appears inconsistent and lacking in protections for the consumer.

Any market requires transparency to remain healthy and thrive. Appraisers are highly trained professionals – essential to our real estate markets – and very capable of thriving in a fair, competitive market. When they are “managed” by AMCs, a lack of transparency regarding the value they produce for the fees the appraiser earns is a risk to a healthy market. A healthy market is transparent and competitive, with oversight that protects and respects the consumer and the public trust.

In today’s world, many AMCs bid out work, sometimes by sending a text notification of an appraisal assignment, and then quickly awarding the appraisal to the lowest bidder. (I was shocked this fall to see some appraisers jumping to bid for these jobs.) Appraisers who know what it takes to do a quality appraisal are often left shaking their heads, asking who would take a job at that price and with such a short turn-around time. AMCs are also increasing the use of property data collectors to inspect the subject property (also called a home), to “increase efficiency.” The public should be concerned that management companies who were supposed to help protect them from another financial crisis have been reducing the fees paid to appraisers through these means, and increasing their take of the consumer’s dollar – with no serious response from banks or the government.

I am certain that there are ethical AMCs who apply best practices and work to ensure high quality appraisals. I want to hear from them! If you are an ethical, consumer focused AMC, your work is getting a bad name based on the practices of predatory AMCs, bad actors who are harming the system they were created to protect. Stand up and tell us how you ensure excellence by upholding high ethics, professional standards, and by protecting the consumer.

To residential appraisers, please join the Appraisal Institute. We will fight for what is right, and there is strength in numbers. Tell us your stories so that we can help the public to understand what is happening. Together, we can make a difference. Your work has value and you need to be paid fairly for the time it takes to do it well.

We are committed to getting the message to consumers that appraisers perform an essential function in our economic system, and anything that interferes with the professionalism and quality of an appraisal is a risk to the public. It is sad indeed that many AMCs, put in place to ensure quality in appraisals, are doing just the opposite

Cindy Chance, CEO

 

[Tiffany Gibbons]

The AMC's incestuous infestation and destruction of the fee appraisal world is unprecedented. https://appraisersblogs.com/exposin...es-corrosive-influence-on-the-housing-market/

Exposing the inner workings of these predatory AMCs and their corrosive influence on the housing market.
Cindy Chance’s recent comments about the concerning practices of some appraisal management companies (AMCs) have struck a chord with many in the real estate valuation industry. Chance is shedding light on the troubling ways in which certain AMCs have come to wield significant power and influence over the appraisal process, often to the detriment of both appraisers and the public. The growth of AMCs in the wake of the 2008 financial crisis was driven by the misguided belief that they could help “ensure the integrity and independence” of property valuations. However, the reality has played out quite differently, with many AMCs prioritizing profit margins over quality and fairness.

These predatory AMCs have created a race to the bottom when it comes to appraiser fees, driving down compensation while simultaneously increasing their own fees charged to lenders and consumers. The lack of transparency around AMC fee structures means the public has little visibility into how their hard-earned money is being diverted away from the actual valuation work. Chance rightly points out that a well-functioning market requires transparency, and the current AMC-dominated model falls woefully short in this regard. By exposing the inner workings of these predatory AMCs and their corrosive influence on the housing market, the CFPB’s initiative represents a vital opportunity to enact real, meaningful reform. Appraisers should take this opportunity to participate in the public comment process and help catalyze transformative progress towards a more transparent, accountable, and consumer-friendly mortgage landscape – one where their role as impartial, objective professionals is truly respected and protected, not exploited for the financial gain of unscrupulous intermediaries. To comment click here.

From Cindy’s desk?


Last week I hit a nerve with some comments about the value of appraisers and predatory AMCs not respecting their value. I got many notes from appraisers who were supportive and a few from AMCs, one of which was downright upset. And here I thought they would agree with me! I was thinking I was careful to call out predatory AMCs only, but apparently the number with ethical, transparent practices may be smaller than I imagined.


How did AMCs become such a powerful market player, and how have they affected real property valuation?

AMCs or “appraisal management companies” function as an intermediary between banks and appraisers to “ensure the integrity and independence” of the appraisal process. The use of AMCs by lenders grew greatly following the financial crisis of 2008 and Andrew Cuomo’s overreaching attempt to universally apply his “Home Valuation Code of Conduct.” The theory was that AMCs would streamline the process, and ensure quality control and compliance. What has actually happened? AMCs have created a race to the bottom in terms of fees paid to professionals and time spent on appraisals. Why? Because there was money to be made in being in the middle and there was nothing to stop AMCs from raising their fees while they reduced the fees they paid to appraisers. The public is not aware of this because AMCs do not need to disclose their fees—something the Appraisal Institute has long supported. The regulatory oversight of AMCs appears inconsistent and lacking in protections for the consumer.

Any market requires transparency to remain healthy and thrive. Appraisers are highly trained professionals – essential to our real estate markets – and very capable of thriving in a fair, competitive market. When they are “managed” by AMCs, a lack of transparency regarding the value they produce for the fees the appraiser earns is a risk to a healthy market. A healthy market is transparent and competitive, with oversight that protects and respects the consumer and the public trust.

In today’s world, many AMCs bid out work, sometimes by sending a text notification of an appraisal assignment, and then quickly awarding the appraisal to the lowest bidder. (I was shocked this fall to see some appraisers jumping to bid for these jobs.) Appraisers who know what it takes to do a quality appraisal are often left shaking their heads, asking who would take a job at that price and with such a short turn-around time. AMCs are also increasing the use of property data collectors to inspect the subject property (also called a home), to “increase efficiency.” The public should be concerned that management companies who were supposed to help protect them from another financial crisis have been reducing the fees paid to appraisers through these means, and increasing their take of the consumer’s dollar – with no serious response from banks or the government.

I am certain that there are ethical AMCs who apply best practices and work to ensure high quality appraisals. I want to hear from them! If you are an ethical, consumer focused AMC, your work is getting a bad name based on the practices of predatory AMCs, bad actors who are harming the system they were created to protect. Stand up and tell us how you ensure excellence by upholding high ethics, professional standards, and by protecting the consumer.

To residential appraisers, please join the Appraisal Institute. We will fight for what is right, and there is strength in numbers. Tell us your stories so that we can help the public to understand what is happening. Together, we can make a difference. Your work has value and you need to be paid fairly for the time it takes to do it well.

We are committed to getting the message to consumers that appraisers perform an essential function in our economic system, and anything that interferes with the professionalism and quality of an appraisal is a risk to the public. It is sad indeed that many AMCs, put in place to ensure quality in appraisals, are doing just the opposite

Cindy Chance, CEO

I would like to say in light of what has happened since Dr. Chance's letter, that the ASA (American Society of Appraisers) does have a fast track for those holding the SRA, they accept your current license and copy of your SRA as proof of your knowledge and education, so if you are disgruntled, check out the ASA for education and designations. Both Residential and Commercial appraisers can get earn the ASA designation as the organization does not push that general appraisers are better than residential appraisers, just different types of real property experts. And no college degree is necessary.