Best AMC

[GWISC]

It is a hard question to answer as to which AMC is great for appraisers to work with. Some appraisers like brand A, but hate brand B and vise versa.

My suspicion is that most of the well qualified quality appraisers have mostly direct lenders as clients and try to stay away from AMC's as best they can. I do. I have as much as I can handle from my direct lender clients and turn down offers from AMC's routinely. The often want me to join their panel, but I would just be a name on their ever extending list and so I turn them down. That leaves potentially less-seasoned vendors willing to take on your assignments doled out by your AMC.

Remember, you can't outsource your responsibility for oversight in the appraisal process. AMC's have no skin in the game. You do.

I have worked with some AMC's in the past that were fine to work with, but then they were bought out by a larger AMC which quickly instituted their policies and then they were not great to work for.

I had some direct lenders years ago, go to AMC's for managing that end of loan production. In those cases, the AMC got their foot in the door of the bank and told them they would only use appraisers on the bank's approved list. At first this seemed to be true, but then our volume would start to dwindle from that lender and finally would be non-existent. Later you would hear that the AMC's preferred appraisers were handling the bulk of that lenders work. All we would get were the complex assignments their preferred appraisers did not want. Sometimes you would run into a loan officer from that bank who would say they missed our work, but could not do anything about it.

I realize having an appraisal ordering and underwriting department is a pain and is costly, but isn't the function of finding the best appraiser in a geographic area important enough to have such a department?

Don't be fooled by their sales pitches about how many appraisers they have in a geographic area either. They may have a hundred appraisers on their list, but I bet they only use 5 of them.

I second the post suggesting to use small local AMC's. You would just have to have several of them for your wide coverage.

 

[Dublin ohio]

I second the post suggesting to use small local AMC's. You would just have to have several of them for your wide coverage.

Agree. But if you do. Keep an eye out. One of my "favorite" small AMCs recently was bought out by Class. Vast majority of work I got from the was from about 5 FCUs. Now that Class has taken them over. I am getting blast orders and quote requests from Class. Not sure what the credit unions are going to do.

 

[DWiley]

I'm kind of new and have always been in the dark as to who or how an appraiser goes about getting on a local lender list for direct engagement. Does it involve sending letter requesting such? Always wondered, but never advised how to get local lender direct engagement assignments? Would greatly appreciate some guidance if you are willing to. TY.

We connected with local lenders through dedicated marketing efforts - joining the local MBA meetings, speaking at events hosted by local lenders, etc. It takes more work than just signing up with an AMC, but the long term benefits were worth the investment (at least in my case). It is not something that happens overnight.

 

[DWiley]

I’m sure you’re right about this. Performance metrics are easy to quantify, and since AMCs compete on these metrics it would make sense that they want to measure their appraisers on it too.

Do AMCs compete on quality though? If not, why even attempt to quantify it with appraisers? If they do (compete on quality metrics), then how are they graded? Also, is it that the quality metrics not quantifiable, or is it that it’s just not worth the cost to quantify quality relative to the risk?

Just as AMCs grade/rank appraisers, lenders do the same with AMCs. I have heard many appraisers say that AMCs had no business ranking/rating appraisers. But, if one is to assign work based on quality, how does one do that without having some system to evaluate/rate/rank quality?

At the AMC where I worked, the appraisers' overall scores were based on 2/3 quality and 1/3 service. Some claim that service should not count, but we are in a service business. In most cases it does no good for a lender to get a great appraisal report if that report comes in weeks after the agreed upon delivery date. The way we rated quality was pretty straight forward - Could we take the report that was submitted and send it straight to the client without having to send it back for revision? If we had to send it back for revision the score was lowered, with the amount determined by the type of revision required. We distinguished between "technical" issues and "material" issues. The scoring was automatic based on the coding of the reason a report was sent back. That was to keep subjective views of the reviewers out of the equation. For example, if a report was sent back because an appraiser failed to provide analysis of a prior sale, that was coded into the system as a rejection reason, and the score would be adjusted by the same amount, regardless of who the reviewer was.

When lenders ranked us as an AMC, most did it almost exclusively by service. Their position was that quality should be expected, so it was really only service that differentiated one AMC from another. I am not saying I agree with that approach, it is just the approach most lenders seemed to take. We had a large lender we worked with that constantly rated us as having the best quality reports, but we kept getting our allocation reduced because of turn times. If lenders manage AMCs that way, how would one expect AMCs to mange appraisers?

 

[alebrewer]

I’m sure you’re right about this. Performance metrics are easy to quantify, and since AMCs compete on these metrics it would make sense that they want to measure their appraisers on it too.

Do AMCs compete on quality though? If not, why even attempt to quantify it with appraisers? If they do (compete on quality metrics), then how are they graded? Also, is it that the quality metrics not quantifiable, or is it that it’s just not worth the cost to quantify quality relative to the risk?

Been a while since I was in the AMC scene, but I do know that most OMS have the ability to track CU scores (not that those necessarily correlate to quality). I'd think revision rates would be a quality metric, no? And I do know of some AMC's who (at least back in the day) applied a quality score to appraisals based on a reviewer's assessment. You might argue that if the reviewer's qualifications weren't commensurate with the appraiser's, that's a subjective measure, but you asked if they compile any quality metrics, and the answer is yes, they do. Just like asking an appraiser to quantify 'quality', though, it can be difficult to measure...

 

[Carnivore]

This is one AMC I really like working with. Their Client Base just doesn't have enough penetration in the Charlotte MSA. Very easy to communicate with and are willing to negotiate the Fee. One of the things I like about FAS COMMUNICATIONS with me are solid and would actually speak on the phone if I needed them to.
They have been around forever and engagement letter(s)are consistent and easy to understand. The delivery system is easy peasy.

Appraisal and REO Asset Management Company – FAS

www.fasinc.com

 

[DWiley]

Been a while since I was in the AMC scene, but I do know that most OMS have the ability to track CU scores (not that those necessarily correlate to quality). I'd think revision rates would be a quality metric, no? And I do know of some AMC's who (at least back in the day) applied a quality score to appraisals based on a reviewer's assessment. You might argue that if the reviewer's qualifications weren't commensurate with the appraiser's, that's a subjective measure, but you asked if they compile any quality metrics, and the answer is yes, they do. Just like asking an appraiser to quantify 'quality', though, it can be difficult to measure...

In our system we had thousands of rules in the QC engine that the reviewers used. That might seem like a lot, but it really isn't if you think about all the various fields on all the possible forms. Any time that a report was sent back for a revisions, it was based on one of the coded rules in the system. It could be for anything - from having the wrong zip code, adjustment in the wrong direction, failure to provide a prior service statement, etc. etc. We deducted 1 point for technical things and 10 points for a material thing (we had an appraiser team that decided ahead of time which items where technical and which were material). That was how we tried to make the evaluations and scoring at least somewhat more objective. It wasn't perfect, but it was consistent. Two reports with the same type of errors would always get the same score.

 

[Carnivore]

I don't just recommend who's good but also Real Bad., If I can just recall, I will let you know about one that you should avoid at all cost.

 

[CGinMN]

When lenders ranked us as an AMC, most did it almost exclusively by service. Their position was that quality should be expected, so it was really only service that differentiated one AMC from another. I am not saying I agree with that approach, it is just the approach most lenders seemed to take. We had a large lender we worked with that constantly rated us as having the best quality reports, but we kept getting our allocation reduced because of turn times. If lenders manage AMCs that way, how would one expect AMCs to mange appraisers?

This is enlightening, thanks for the insight. Of course appraisers understand very well that cost and timing are the most important parameters for the vast majority of users in this industry. There is no bonus for going above and beyond in quality. The most successful appraiser is the one that meets the bare minimum expectation in the quickest amount of time. Ticking the right boxes and including the appropriate boilerplate is incentivized. Going the extra mile to show your work and explain your processes for extracting adjustments is not rewarded. The metrics most AMCs grade on are the ones that will ensure they will be as profitable as possible, they’re not quality driven metrics. Every revision is an expense.

So why even attempt to quantify quality of lenders do not care and it was costing you business?

 

[Salty]

I did not read through all 9 pages but why not just engage appraisers directly. Hire me as an employee to work remotely and I will be in charge of the process. I am serious. PM me. I have SRA, MBA, FMVA and more certs. I will build relationships with quality appraisers across all specialties. I will establish the panel and the review process. I will make my self available to the panel for any questions and concerns. I am serious if you are interested PM me.