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Are AMC's a problem or have Appraiser's lowered their standards?

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Rrebera

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Ohio
I have read through several dozen appraisal complaints about one company or the other, but the bottom line appears to be that appraiser's are having to work for AMC's, which has lowered their pay per appraisal. If this is the case has the appraisal business as a whole, lowered their standards, with a reduction in pay, which could lead and had led to quality appraisals? Just want to get your thoughts!
 

Terrel L. Shields

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the bottom line appears to be that appraiser's are having to work for AMC's, which has lowered their pay per appraisal. If this is the case has the appraisal business as a whole, lowered their standards, with a reduction in pay, which could lead and had led to quality appraisals?
AMC's only exist because appraisers let them exist. Therefore, I have concluded that the bulk of appraisers working for AMC's want a pay cut and higher liability. Otherwise, they have no incentive to kowtow to those scumbags.

We are a self-sunsetting industry which, like lemmings heading for the sea, hope the government will turn us around, before the lenders drown us. Meanwhile, we eat our own either by undercutting fees to the point no one makes any money or standing on one foot or the other pointing to the subservient and crying wolf to the state board whom we mistake for protectors and not punishers. Cheery thought.
 

David Wimpelberg

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AMC's and MB's are two of the biggest reasons why I'm getting my GC and am effectively out of the lending end of the business.
 

leelansford

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Illinois
I have read through several dozen appraisal complaints about one company or the other, but the bottom line appears to be that appraiser's are having to work for AMC's, which has lowered their pay per appraisal. If this is the case has the appraisal business as a whole, lowered their standards, with a reduction in pay, which could lead and had led to quality appraisals? Just want to get your thoughts!

What you have observed is a part of the problem with the appraisal profession, but certainly not the only problem.

I have no way of offering absolute proof to what follows, but I do believe that the average level of competency among residential appraisers is lower today than, say, 20-25 years ago. I believe that the lowering of standards (or, competency) by many practioners came before the advent of AMCs
 
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Couch Potato

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Mar 15, 2004
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North Carolina
AMC's only exist because appraisers let them exist. Therefore, I have concluded that the bulk of appraisers working for AMC's want a pay cut and higher liability. Otherwise, they have no incentive to kowtow to those scumbags.

We are a self-sunsetting industry which, like lemmings heading for the sea, hope the government will turn us around, before the lenders drown us. Meanwhile, we eat our own either by undercutting fees to the point no one makes any money or standing on one foot or the other pointing to the subservient and crying wolf to the state board whom we mistake for protectors and not punishers. Cheery thought.
I wish I had written that. Nicely said Terrel. I'm seeing reference to fees of $145 dollars for an appraisal given in a 1004 format. I would consider giving a 10% - 20% discount to someone who guaranteed a certain level of volume, but a 61% discount is just not happening.
 

Tom Woolford

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I do believe that the average level of competency among residential appraisers is lower today than, say, 20-25 years ago. I believe that the lowering of standards (or, competency) by many practitioners came before the advent of AMCs

I think you are correct that overall the level of competency has decreased, mainly due to poorly supervised trainees, and "get rich quick" types that blossomed during the boom. Personally, I know I am a much better Appraiser than I was when I entered 20 years ago. It is up to each appraiser to decide if he wants a check, or to be professional. Unfortunately, It appears the majority are in the former group, and do not give a crap about being professional. While I don't believe AMC's encouraged this trend, they probably made it possible with fees that were too competitive. You can split a pie only so many ways and come away from the table satisfied.
 

Lawrence R.

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South Carolina
The problem is the AMC's...without them, people who did sorry work were weeded out by those who did superior work.

The vast majority of sorry appraisers have flocked to AMC's, as AMC's are the only client they can satisfy.

The few good appriasers the AMC's have are the ones they use to show off the "quality work" they provide...yeah right.

AMC's may not have started the problem...but they have created the environment in which the problem thrives.

I have nothing but disdain for the whole business model...
 

Terrel L. Shields

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I know I am a much better Appraiser than I was when I entered 20 years ago
80% of drivers feel like they are better than average drivers....not possible, right? I don't know anyone who doesn't think they are 'better". SO. How do you test "better"?
We have better tools. (no computers in 1975)
We have better data. (no on-line data)
We have better instruction. (more CE required, more training)
We have better oversight. (a state board vs no board at all.)
That begs the question. Are our estimates of value more accurate than they were in say, 1975? I think the short answer is no, even the best appraisers. The documentation is better. The explanation is better. But in reality a 'good' Realtor can guestimate the value of a house as close as 95% of the appraisers I know. Many years ago an appraiser told some local bankers who did their own appraising and were being taught about appraising by that MAI, "You know your market better than I do. The difference is I can work all the markets you do whereas most of you will (rightfully) be unsure about working outside the area that you make loans in."
We shouldn't take ourselves too serious. I believe that appraisal "theory" will never gel largely because we are trying to predict the "rational" behavior of humans as acting solely upon their personal best (economic) interest and that is patently not true. People donate or encumber land to Nature Conservancy or voluntarily give land to a church or charity. They give neighbors easements for free. Build onto a house when they know it would make sense to sell and just buy a larger home. Neglect a property or give it away to children. The idea that there are "rational" men out there who act as the "invisible hand of the market" which is guiding this market is poppycock. Read Wealth of Nations again. That "invisible hand" was denoted in a single instance by Adams and sarcastically then. His real thrust was that rich people deserved to dominate the poor and aboriginal solely because they were rich hence must be "smart" whereas the poor were dumb. Some economic theory, yet appraising is based solely upon that 'invisible hand' which is rational and therefore predictable.

the level of competency has decreased, mainly due to poorly supervised trainees, and "get rich quick" types that blossomed during the boom
the trainee system is badly broken and will not be fixed. The trainee system funnels trainees into the kinds of mills that preach that USPAP is "theory" and this is the "way its done." They are not incompetent. They are taught that fraud is the way its done. Don't think about it. Its all about pleasing the customer...
 
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Doug Wegener

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Apr 14, 2005
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Certified Residential Appraiser
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Oregon
Yes

I have read through several dozen appraisal complaints about one company or the other, but the bottom line appears to be that appraiser's are having to work for AMC's, which has lowered their pay per appraisal. If this is the case has the appraisal business as a whole, lowered their standards, with a reduction in pay, which could lead and had led to quality appraisals? Just want to get your thoughts!

Yes, many appraisers are having to work for AMC's which has lowered their pay and resulted in lower quality appraisals. Also a factor in lower quality is the ridiculous turn times demanded by some companies.

But since they have a lock on much of the work and have conspired together
to keep fees low thats the way it is.

Maybe someday the quality will catch up to the AMC's. Maybe
 

OSU Beavers

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Jan 10, 2007
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Oregon
No, Skippy is the problem. Skippy is the unwashed burger flipper of the drive-thru appraisal world. "Would you like rental comps with that? No? $150 at the window please".

Instead of waiting for a quality meal at a sit down restaurant, lenders have been ordering "to go" and it looks like subprime caught a large dose of E.Coli.
 
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