Because all the uproar over some of the “advertised” and/or “alleged” rates are a huge distraction causing a bunch of emotional turmoil, and that is causing some to lose focus on the big picture and the real issues.
Clients are tired of dining at the same place and getting the same food all the time. They have decided that they don’t want steak for every meal. That want to see what happens if they get the meatloaf instead, or a burger, or even skipping a meal.
But, appraisers are placing too much focus on fantasy fees, and not enough focus on the threat to their profession that exists from refusing to listen to what clients want. Appraisers should just charge professional rates. Period.
And they should embrace the SOW rule and drop the 1004 protectionism.
Every day we order as many or more BPOs as appraisals? Sad, but true. That work is work that should be going to appraisers, but it is going to agents because when lenders wanted something less than the 1004, appraisers as a group, said “NO!” So, the lenders sought another solution. The same will happen with the 1004P/hybrids. If appraisers refuse, lenders will simply find another solution.
We have already seen it in NY. They passed a new law basically outlawing AMC ordering of “hybrids.” The reaction of the lenders was swift - that work that was going to appraisers is now going to non-appraisers (whom the appraiser board has no regulatory authority over). Some NY appraisers are mysteriously celebrating that as a win.
The long term threat is VERY real, and appraisers need to quit bickering before the users just decide that dealing with appraisers just isn’t worth the hassle.
I don''t know the answer, but if lenders Or AMC's intended to pay "professional rates", this would not be an issue- fannie is driving the waiver and hybrid bus, though AMC;s position themselves to make $ no matter what valuation product is ordered.
If appraisers can not earn "professional rates" from the alternate products, it would pay for a number of them to stop maintaining an appraisal license and instead do inspections or evaluations under a RE license (or whatever criteria is accepted )
It is one thing to say appraisers should charge professional rates, but since the rationale for hybrids is "cost savings" , that indicates a lower rate paid- unless a lower rate is paid to the appraiser, how then, is the cost savings achieved? And despite the possibility direct lenders would pay a better rate for a hybrid, it would still be lower, or why would they even order one? Though appraisals are still in contract continuances and some owners or RE agents may object to results with a non appraiser inspecting, . The reason non appraisers are being engaged for the inspections is because they are more numerous and thus cheaper., and can deliver faster is that is all they do. Though what great benefit saving a day in TT is questionable.
It will still leave lenders with the same problem- even with faster closing speed or appraisal waivers or cheaper valuations, there will stil be a limited and finite number of people any given time who will buy a property or borrower against their home. Consumers are not going to be:, "Wow ! I can save $ 50 on an appraisal and close sooner, so 'll turn my life upside down and buy a house"
Which means when lenders reach equivalent speed, they will end up right where they are now, offering similar rates and terms. Only difference is those more traditional lenders who actually use due diligence or foster relationships with their customers rather than being an anonymous internet click..
Lenders face a problem, the only way they can increase volume , except for periods of short term interest rate drops, is if they offer exotic and high risk /low down $ loans, which is already starting to happen.
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Just thought this was worth repeating!