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Better Business Model Alternatives

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TJSum

Thread Starter
Elite Member
Joined
Nov 12, 2007
Professional Status
Certified Residential Appraiser
State
Maryland
I am just posting this to get a discussion going on how better to band together nationally to offer good, honest appraisals. The investors have seen the bank owned AMC's and AVM's are not the answer as they are counting their losses into the billions. The industry is screaming for a proper firewall. Instead of sitting back waiting for the lawmakers to set this up, we know how that goes, let's show them how it could be done and offer a true alternative.

Most of us consider ourselves independent business people, so the idea of a "union" does not pass the smell test. The closest thing to it that I am picturing is a Co-op. Each appraiser would be part owner, there would be no one giving orders like the AMC's, it would be more like an appraiser owned national registry. The marketing point would be a TRUE FIREWALL, the code of ethics to be a member and client would have to follow certain guidelines. No comp checks, no estimate of values on the refi orders, etc. No 24 hour turn times, no pressure except to produce a professional solid honest appraisal report.

Yes, it would start out very slow, until the word about the AFC (Appraisal Firewall Coop) got out, so we would limit the amount of members to, pick a number, say 500 nationally, which would average 10 per state. This would avoid too much coverage for any one area.

The appraiser would set his own fees, and keep 100% of it, the COOP is really only an appraiser owned registry that sticks to a certain code of ethics to create the FIREWALL that the industry is screaming for. The COOP fee to the appraiser could be approximately $15 per month, to pay for the website maintenance and for someone to manage it, maybe an appraiser who is more into tech stuff than actual appraising :) This would come to $90,000 per year which should cover those expenses. We could then tack on another $15 per month for advertising, to get the word out. This number could be anything depending on how much advertising we wish to do. At these rates, each appraiser would be charged $360 per year, so one appraisal per year would cover the expenses.

The main problems to be worked out, how do we monitor the appraisers to make sure they are sticking to the code of ethics. ?????

We could have our "10 Commandments" or whatever pasted on the main page of the website to show any potential client what we are about and the thing we are marketing is the FIREWALL currently missing in the industry. We are not marketing speed or assignments to the lowest bidder, etc.

I know 95% of the industry will not want us, no problem, even 1% would give us all a nice income :) And once the word got out, maybe the investors who are counting their billion dollar losses right now and are looking for a fix, may just put enough pressure on the right people to use our services.

The Coop could have a rep for each state, but 50 reps might be to hard to work with to make any decisions. So maybe a board of 5 "decsision makers" could be formed from the 50 reps via a yearly vote.

Just some ideas, to throw around, it is just a starting point. Most of us have a few honest clients we work with locally, but with the changes in the industry with the internet making things more national, we need to find these honest clients nationally. How many times have our good clients asked us if we knew appraisers from outside our service area ???

Let's not attack each other, lets put our heads and ideas together and give something like this a try, it beats being a victim with nothing to do but complain about the system.

Lets hear some ideas :icon_idea: :icon_idea:
 
Last edited:

kerrylanger

Member
Joined
Sep 6, 2005
Professional Status
Certified Residential Appraiser
State
Wisconsin
It kinda sounds like other things that are being tried. Putting a different name on it does not change the idea. If you go back and look there have been several people that have cried for "unification".
 

kerrylanger

Member
Joined
Sep 6, 2005
Professional Status
Certified Residential Appraiser
State
Wisconsin
I guess it would be like herding cats...
 

CraigButterfield

Sophomore Member
Joined
Nov 14, 2007
Professional Status
Certified General Appraiser
State
Florida
I am just posting this to get a discussion going on how better to band together nationally to offer good, honest appraisals. The investors have seen the bank owned AMC's and AVM's are not the answer as they are counting their losses into the billions. The industry is screaming for a proper firewall. Instead of sitting back waiting for the lawmakers to set this up, we know how that goes, let's show them how it could be done and offer a true alternative.

Most of us consider ourselves independent business people, so the idea of a "union" does not pass the smell test. The closest thing to it that I am picturing is a Co-op. Each appraiser would be part owner, there would be no one giving orders like the AMC's, it would be more like an appraiser owned national registry. The marketing point would be a TRUE FIREWALL, the code of ethics to be a member and client would have to follow certain guidelines. No comp checks, no estimate of values on the refi orders, etc. No 24 hour turn times, no pressure except to produce a professional solid honest appraisal report.

Yes, it would start out very slow, until the word about the AFC (Appraisal Firewall Coop) got out, so we would limit the amount of members to, pick a number, say 500 nationally, which would average 10 per state. This would avoid too much coverage for any one area.

The appraiser would set his own fees, and keep 100% of it, the COOP is really only an appraiser owned registry that sticks to a certain code of ethics to create the FIREWALL that the industry is screaming for. The COOP fee to the appraiser could be approximately $15 per month, to pay for the website maintenance and for someone to manage it, maybe an appraiser who is more into tech stuff than actual appraising :) This would come to $90,000 per year which should cover those expenses. We could then tack on another $15 per month for advertising, to get the word out. This number could be anything depending on how much advertising we wish to do. At these rates, each appraiser would be charged $360 per year, so one appraisal per year would cover the expenses.

The main problems to be worked out, how do we monitor the appraisers to make sure they are sticking to the code of ethics. ?????

We could have our "10 Commandments" or whatever pasted on the main page of the website to show any potential client what we are about and the thing we are marketing is the FIREWALL currently missing in the industry. We are not marketing speed or assignments to the lowest bidder, etc.

I know 95% of the industry will not want us, no problem, even 1% would give us all a nice income :) And once the word got out, maybe the investors who are counting their billion dollar losses right now and are looking for a fix, may just put enough pressure on the right people to use our services.

The Coop could have a rep for each state, but 50 reps might be to hard to work with to make any decisions. So maybe a board of 5 "decsision makers" could be formed from the 50 reps via a yearly vote.

Just some ideas, to throw around, it is just a starting point. Most of us have a few honest clients we work with locally, but with the changes in the industry with the internet making things more national, we need to find these honest clients nationally. How many times have our good clients asked us if we knew appraisers from outside our service area ???

Let's not attack each other, lets put our heads and ideas together and give something like this a try, it beats being a victim with nothing to do but complain about the system.

Lets hear some ideas :icon_idea: :icon_idea:

For those that think, I have some screws loose, your tires are rolling down the road without your car.
 

TJSum

Thread Starter
Elite Member
Joined
Nov 12, 2007
Professional Status
Certified Residential Appraiser
State
Maryland
Thanks for the personal attack Craig, you are a class act.
 

Doug Trites

Junior Member
Joined
Oct 17, 2007
Professional Status
Certified Residential Appraiser
State
Michigan
I have tried to start the same type of thing, and all I heard was, you can't heard cats, Someone has tried that and it did not work, ETC. I find it really sad that with the true professionals we have on this forum, we can not get something started.

IMHO now is the best time to start with an Org. that is really for the advancment of the profession. As I have stated before, I really feel that Pam would be a perfect head of the new Org. She has taken the risk that most of us would not and has stood up for what is right. This was done knowing that it would have a negitive effect on her own business. Pam has already proven she will stand up for the profession.

This country would not be here if we all took the position that, it has been tried before and did not work. I would much rather have my money go to an Org. that is really out for the advancement of the profession and looking out for the apprasiers, then to pay a group like the appraisal foundation who is out for the power and money.

I may be new to this group, but I care about this profession!! This can be done if we leave our ego's at the door and work together.

Respectfully
 

Kevin A. Spellman

Senior Member
Joined
Aug 30, 2003
Professional Status
Certified Residential Appraiser
State
Massachusetts
Sell the appraisal data and not the appraisal report. If the data is mapped correctly and can be integrated into an appraisal form 1004 or a 2055, let the lender create the reports. We are all probably good at data collection and creation, we just do not have enough time to maintain the data and do appraisals at the same time.
 

Fred Rossiter

Sophomore Member
Joined
Nov 7, 2006
Professional Status
Certified Residential Appraiser
State
Florida
I like the concept. Go for it!
 

SMF

Sophomore Member
Joined
Oct 11, 2007
Professional Status
Certified General Appraiser
State
Virginia
This sounds like a very interesting idea, but it also sounds familar almost like what we already have in the associations that we already have like the AI.
 

Karl

Elite Member
Joined
Jan 15, 2002
Professional Status
Licensed Appraiser
State
Arizona
AVM's AMC's are NOT the problem Appraisers that Kissed @$$ are the problem until we admit that WE ourselves created the problem NOTHING is going to change. 40% of the Apprasisals that Fredie Mac has APPEAR to be inaccurate.

Unification NOW there is a JOKE!! How many during the "BOOM" refered work to other Appraisers, that were Geo confident in the area of the assignment?? How many instead just went out & got a TRAINEE to assist in getting that work done??

How many decided that since they were only 2 5 10 Thou below the contract price SIMPLY increased the Appraisal to meet the Contract?? How Many forgot to mention that the Coast to cure would be MORE than the house was worth. How many didn't take innterior photo'sd cause there weas NO flooring?? Or other defects such as Mold??

How many of you wrote to your Congress & governors during the "BOOM" saying there is a major problem? How many got chuckles out of the 5 of us on here that told you this was coming back then?? How about those of you that came behind me & others from 60 to 100 even 200 miles away & miraculously got the contract price?? That we were unable to get in the town we live in?? How many checked the Owner Occupied Box cause it was EASIER?? How many of you contacted Already formed ASSociations & asked them to help?? How many attended meetings with other Appraisers that were trying to stay honest duuring this "Carpet Bagger" Boom????

NOW how many of you took on more than ONE trainee during that BOOM??

How many of you that took on a Trainee had your OWN license for more than 5 years??

How many Board meeting did you attend during the "Boom"?

Bet not many on here have the [email protected]!!$ to answer those questions.

There is MORE proff that Appraisers made Bogus Appraisals than any other single item. That is why Appraisals were so important during the "BOOM" So there would be a paper trail as who to blame. Think about a RE Agent needs to keep paper work 3 years A mortgage lender ONE year & yet an Appraiser has to for FIVE!! Those that kissed @$$ are problem,. Fannie Freddie & ALL the others do NOT have the FULL Appraisal they have page 1 2 & your signature.

Think about this how many REO's are there in your area? How many REO assignments have you gotten compared to REO assignments prior to the Boom??? OH those RE Agents that you Kissed @$$ for during the boom are NOW doing BPO's for those REO's?? OH & when you paid your DUES to your RE ASSoc. Did you include the Volunteer portion that supports their lobby??
 
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