Appraising is like a minimum wage job.

[George Hatch]

Adults, including adult men, recognize that people are comprised of a psyche and feelings, and that is a pattern of gaslighting to claim their viewpoint is neutral, logical and not driven by feelings, whereas the other side is, (particularly if it comes from a female )

Appraisers feel bad about the repeated denigration of their right to a fair fee , which is law btw for GSE-regulated work, but it got corrupted in the AMC model -appraisers "feel bad" about it because it normalizes the efforts to lower C and R, and advocates for it. Your posts on the topic are not neutral, and they do advocate for a more widespread dismantling of the safeguards for C and R. Why would you expect appraisers to be happy about that or neutral about it?

How would you feel if you returned home one day and your house got burned down? Would you feel nothing and start explaining how a spark and oxygen can mix to create heat ?

FTR, that's also a bold faced lie. WRT C&R I have always said the feds came down on the wrong side of that debate and that they should go back to the original intent of C&R. What I haven't done is mindlessly assume that C&R itself will result in a benchmark that is completely isolated from the effects of competition in the market. You also need to stop saying I'm somehow happy about appraisers getting starved for fees because that's an outright lie, too. Just because I can see it doesn't mean I advocate for it or am happy about it.

Your reimagination game is not serving you well. .

 

[Zoe]

I keep repeating it to you because you keep making the argument that the other parties are SHOULD care beyond whatever point of diligence they think is sufficient to purpose.

As long as there is any demand whatsoever for appraisals in the mortgage lending business there will be people who will be willing to do the work for whatever fee the market will bear. It won't be everyone who is currently in the business but then again it doesn't have to be everyone. My thing has been and continues to be that it is in the appraisers' best interests to sell the level of SOW and the level of service that the users and clients want to buy. That won't always consist of the conventional 1004. Or the 100-page narrative that many of the CGs want to sell for everything they do.

I think I might have done 2 narratives in the last year, which is about what I have normally averaged ever since I switched over to my own forms. That's what my particular clients consider to be sufficient to purpose and its what they want to buy.

That is where VA operates differently from the main stream. They focus on the veteran as much as the lender. Trust me they don't take crap from lender, Veteran or appraiser.

However, they do focus on the borrower very much. You have to understand your client's position.

Some clients don't focus like that.

Fastest and cheapest is some client's focus.

 

[Zoe]

Many lenders that hire directly do not focus on fastest and cheapest. If you can get a local lender in your area and get them to hire you directly, you will be much better off than going through an AMC. Same way with local lawyers, accountants, Dept of Transportation, etc.etc. They are not interested in fastest and cheapest.

 

[Terrel L. Shields]

they should go back to the original intent of C&R.

I might be wrong, but I think the original intent of the concept of "C & R" was to deceive and gaslight appraisers into supporting the reforms proposed, or at least keep them from thinking it would impact them in any way but a positive one. So, C & R is not a panacea to protect appraisers. In fact, it is a nothing burger that does not stop anyone from offering $195 for a 1004 appraisal, nor does it imply that the AMC and lender are under any obligation to seek the best qualified appraiser for the assignment without regard to turn time and fee. But the only two factors that the Feds didn't say were reasons to choose the appraiser are the only two that the AMC uses.

 

[George Hatch]

But the only two factors that the Feds didn't say were reasons to choose the appraiser are the only two that the AMC uses.​

True

 

[Carnivore]

The Lenders and AMC's only reward Lowest Fee & Turn Time. Meritocracy be damn.

 

[J Grant]

I might be wrong, but I think the original intent of the concept of "C & R" was to deceive and gaslight appraisers into supporting the reforms proposed, or at least keep them from thinking it would impact them in any way but a positive one. So, C & R is not a panacea to protect appraisers. In fact, it is a nothing burger that does not stop anyone from offering $195 for a 1004 appraisal, nor does it imply that the AMC and lender are under any obligation to seek the best qualified appraiser for the assignment without regard to turn time and fee. But the only two factors that the Feds didn't say were reasons to choose the appraiser are the only two that the AMC uses.

I do believe you are wrong = the feds did not have to gaslight appraisers into supporting the reforms; they did not need support from appraisers do make law.
They were aware that a sea change was afoot by the new regulations prohibiting individual loan officers from ordering the appraisal. The client orders were generated by individual loan officer of a allowed to select an appraiser. Not after HVCC - then it would have to be a nonloan officer at the lender or a third-party AMC. The feds were aware that this greatly narrowed the demand side - even if the same # of appraisals were ordered by X client, instead of 200 loan officers selecting, we have one AMC, or one panel manager assigning.. Which skews the normal ratio of supply/demand to the disadvantage of appraisers - thus, the first, original position of Cand R was for lender surveys and VA and govt surveys to establish the C and R in a region

The profiteers representing AMC interests fought it and won - that is what G Hatch correctly identified as he supported the original ( first ) version of Cand R . The second version, that an AMC can use ther own internal fee survey, doomed appraisers from getting C and R that private, lenders , and VA pay. The skewed S/D of the narrow channel of AMC ordering large volume means the appraisers can get C and R as other professions do who do not have prohibitions on who orders or pays for a service ( and private appraisal work also is not affected )

The incentive to low-fee bid fees is not present when lenders order directly because their money comes from loans; they are not in the business of making money off of appraisal splits, whereas the AMC gets their money from appraisal splits- and the more of the split from the HUD bundled fee the AMC keeps, the less goes to the appraiser - simple as that. It is not in play when lenders order something; for some reason, some do not understand, and they keep lumping lenders and AMCs together. The AMC is in a complete different business than a lender is., even if they handle lender orders .

I wonder what goodies were dangled to regulators to sway them to allow a second C and R for AMC's, but they sold appraisers out on it.

C and R function well in the real world because, in most fields, there is no prohibition about who hires or orders a service - and in private appraisal work, that is true as well. Thus, the ratio of people ordering vs the people supplying is in a natural balance. That is why, when comparing fees or rates of any profession or service in an area, they are very similar, with a few higher charges and a few bargain folks, but most are in the middle with the same or similar rate. That does not happen in AMC world, where the S/D ratio is severely out of whack with the result that fees are always driven low, except in a rare time of high volume ( the pandemic/low rates) or a niche area like a very rural remote location.

My issue with G Hatch is his posts that promote the idea of an app to make real-time live fee bidding which would send appraisal fees even lower - .

As to your last sentence - the only two factors- that is correct and is the reason why AMC's refers to appraisers as "vendors" - as in our valued vendor partner -

 

[J Grant]

The Lenders and AMC's only reward Lowest Fee & Turn Time. Meritocracy be damn.

Please don't join the G Hatch misinformation train and say the lenders reward low fees - the lenders, when they do not use an AMC and the lender orders directly, offer C and R fees to their appraiser panels. The borrower covers the appraisal fee, so the lender does not make any money, nor save any money, if the fee is $4300 or $500- the borrower covers it either way.

With an AMC, it is entirely different. The AMC makes their money and gets compensated by how much of the borrower paid appraisal fee ( passed to them from the lender ) they can keep from teh slit, and the less they can pay the appraiser ( the low bid or low rate, fee the appraiser accepts for an order ) In the regulations, there is a clause that an AMC can ontl ON:Y select by fee. Thus they pay lip service to that by asking for turn time so they can say the decision was not only made by fee. (even though it is, ) since many appraisers offer same turn times, and the order has a due date anyway )

 

[George Hatch]

I'm not promoting anything other than suggesting appraisers use some common sense as to the possibilities. Past behavior indicates to future behavior. One of those possibilities involving technology that might enable *appraisers* to directly compete with each other in real time.

I'm speculating what the demonstrated trends of a technology enabled market for services might get to if taken to its logical conclusion. I'm guessing that sooner or later one of those vendors at the CRN expo might take a swing at it. And that the same bidder behavior that drives ebay could also function to the same effect - only in reverse - to provide everyone in that network with the same access to the same assignments in that local. In real time. And that the app itself could be configured so the only employee action on the lender's side is to enter the address and contact info into their system - the app updates their web page. No "human monitoring" or individual negotiating involved.

My understanding of it is that there have already existed for several years a couple apps that appraisers can use to auto-accept assignments as soon as the blast goes out. Somebody already figured out how to give their customers an edge in beating out their peers for access to those assignments, and some appraisers have already been using such an app for the purpose of beating out their customers.

So much for the idea that no appraisers will use an app to compete for assignments.

All that adding a "current bid" counter to the process would do is increase the level of transparency in the market for appraisal services. So that every appraiser watching can know what action they need to take in order to get that assignment. And so that every lender or AMC and govt regulator watching can know what fees appraisers are actually working for. We can get closer to that full disclosure that some appraisers think will improve their situation. More transparency is a good thing, right?

Instead of worrying about how much AMCs make your bigger problem might end up being how appraisers choose to compete for business in a more transparent marketplace. Even moreso when they can access that information in real time.

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Or perhaps a different future lies ahead of us. Maybe everyone on the demand side of the market for services (the lenders and AMCs) will just magically stop thinking of ways to compete with each other. Maybe all or most of them will act instead on the basis of thinking that in terms of goods and services the appraisals are special to them and not like any other service that they use. Maybe you think that they consider appraisers to be a precious resource which needs to be protected from the dynamics of supply/demand.

Everyone here can consider these and any other possibilities for how they think the business might move in the future. Or instead of developing their own strategy for survival they can just sit back and wait for the outcome to happen and just hope it all works out in their favor.

The next time you accuse me of engaging in misinformation or advocating for fee appraisers to get hurt you might consider the possibility that I believe thinking ahead for the various possibilities is a stronger survival strategy. That complaining about the status quo and hoping the decision makers will take mercy on appraisers because we're special isn't a plan at all. It's a surrender.

 

[J Grant]

I'm not promoting anything other that appraisers using some common sense as to the possibilities. Past behavior indicates to future behavior. One of those possibilities involving technology that might enable *appraisers* to directly compete with each other in real time.

I'm speculating what the demonstrated trends of a technology enabled market for services might get to if taken to its logical conclusion. I'm guessing that sooner or later one of those vendors at the CRN expo might take a swing at it. And that the same bidder behavior that drives ebay could also function to the same effect - only in reverse - to provide everyone in that network with the same access to the same assignments in that local. In real time. And that the app itself could be configured so the only employee action on the lender's side is to enter the address and contact info into their system - the app updates their web page. No "human monitoring" or individual negotiating involved.

My understanding of it is that there have already existed for several years a couple apps that appraisers can use to auto-accept assignments as soon as the blast goes out. Somebody already figured out how to give their customers an edge in beating out their peers for access to those assignments, and some appraisers have already been using such an app for the purpose of beating out their customers.

So much for the idea that no appraisers will use an app to compete for assignments.

All that adding a "current bid" counter to the process would do is increasing transparency in the market for appraisal services so that appraiser watching can know what action they need to take in order to get that assignment. And so that every lender or AMC and govt regulator watching can know what fees appraisers are actually working for. Taking all the guesswork and uncertainty out of the process.

Instead of worrying about how much AMCs make your bigger problem might end up being how appraisers choose to compete for business in a more transparent marketplace. When that information is coming at them in real time.

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Or, maybe everyone on the demand side of the market for services (the lenders and AMCs) will just magically stop thinking of ways to compete with each other. That they'll act on the basis of thinking that in terms of goods and services the appraisals are special to them and not like any other service that they use. Maybe you think that they consider appraisers to be a precious resource which needs to be protected from the dynamics of supply/demand.

You keep lumping AMC's and lenders together, which assumes they are driven by the same dynamic. That is not true and that is my contention with your assumption of it.

Everything you say applies to an AMC. They already use apps, staff, email, etc., to solicit bids and fee comparisons, so they might want it in real time, live on an app- their vendors already suffer from the application of tech, so this is just one more , which an AMC might or might like to use. Sounds like a lot of monitoring because what appraisers want to schedule logging in at teh same time to bid? Monitoring it in real time over the course of a day - the live app does not sound like an improvement over what they use now, but that is not my bailiwick.

But imagining lenders would want it is another thing, Trenley. Again, a lender who orders directly chooses not to use an AMC, and instead, the lender uses their own panel. The lender seeks to have ether panels all paid the same C and R rate in a region for noncomplex orders. That complies with the regulations and simplifies things for loan officers as they all quote the same appraisal rate for the borrowers on the TILA. The lender makes their money from loans, not from splitting appraisal fees ( they are not allowed to fee split with themselves. Therefore a lender has no incentive to monitor an app that compares appraisal fees or bids it would in fact be a waste of time for them. The lenders have their valuation and appraisal associated costs covered and manageable, so it is a nonissue for them. The borrower covers the appraisal fee, whether $500 or $550, so the lender using an app for changing fees is now wasting time and resources with more chaos around simply conveying an appraisal fee to the borrower, among the many other fees a borrower is responsible for.