"customary And Reasonable Local Fees" Clarified Thanks To Working Re Survey

[FHA Steve]

KUDOS with Quote to MH

AMCs are an adverse external influence on the appraisal industry and the residential real estate industry. The loss in value impacts appraisers, homeowners, investors, and ultimately the American taxpayer.

This is a race to the bottom. The lowest common denominator. Lowest fees + quickest turn time = the best appraiser for the assignment. Experience and quality are not cost effective. Not profitable.

Try putting the AMCs in charge of setting real estate commissions and loan officer commissions and see how long they last. The appraiser is played as the chump in the real estate world. And we take it.

WELL SAID!!! :new_2gunsfiring_v1: FHA STEVE

 

[Cascada]

This stories sound worse and worse each day. We should work for free and it should be called "RECREATIONAL APPRAISAL ASSIGNMENTS" where the appraiser takes a tour to a paradise place called "SUBJECT" and the appraiser has joy and fun doing the ultimate "VACATION APPRAISAL REPORT". Cool ..... In a not to far future the programs will be hired to take the ultimate control of the appraisal business, just wait.... it is coming... (ZILLOW, AVM, ZAIO CORPORATION),

 

[kimbtod]

We received a request for an FHA appraisal from an AMC with a fee of $225. Needless to say, that is well below what is reasonable and customary in this market and we countered with our regular fee. They will get back to us if it can be approved by their client. That was days ago.

Sadly, what this suggests to me is that there are appraisers willing to accept these assignments at these low fees. I do not understand how it is possible to cover expenses i.e. MLS fees, courthouse data, E & O, software, CE, travel, let alone make a living.

What's really sad and frustrating, is that the AMC isn't going back to "their" client and saying the appraiser won't accept the order at $250. They are going back to the client and saying they need $850 for the appraisal instead of $XYZ. (There's no way the AMC is going to take a cut pay).

 

[Pittsburgh Pete]

This from the email marketing the AI's webinair addressing the House bill:

Financial Reform Legislation: Appraisal and Real Estate ImpactsThis upcoming webinar will provide the details of the pending Conference Report on H.R. 4173, the Restoring American Financial Stability Act of 2010. This legislation, if enacted, would mark the first modernization of Title XI of FIRREA since 1989, addressing several issues of concern to the appraisal community.

In particular, an amendment backed by the Appraisal Institute and its partner professional appraisal organizations was accepted by the House-Senate Conference Committee last week that effectively defines “cram downs” of appraiser fees as an “unfair and deceptive” practice under the Truth in Lending Act. Under the amendment included in the final Conference Report, evidence of “customary and reasonable” fees would include government fee schedules and independent studies that exclude appraisal orders from known appraisal management companies.

How "bout that!

 

[Scott Jones]

Appraisers willing to accept assignments at low fees.

We received a request for an FHA appraisal from an AMC with a fee of $225. Needless to say, that is well below what is reasonable and customary in this market and we countered with our regular fee. They will get back to us if it can be approved by their client. That was days ago.

Sadly, what this suggests to me is that there are appraisers willing to accept these assignments at these low fees. I do not understand how it is possible to cover expenses i.e. MLS fees, courthouse data, E & O, software, CE, travel, let alone make a living.

In any business you have good and bad. Appraisals are not different. A large group of us in our area have found that we have appraisers traveling from hours away and completing appraisals in a fraction of the time and for half the fee of what our local appraisers are doing it for. Why would some of these AMC's hire us? If the loan goes bad they have an appraiser to blame and these cut rate appraisers are makeing them alot of money right now. Our local guys are working nights and weekends to complete 5 to 8 reports a week in our rural area. These cut rate appraisers are bragging how they complete 15 to 25 reports a week. They are makeing money on volume. Needless to say the AMC's are going to hire these guys. I've been told by several realtors and home owners in the area that these appraisers don't measure there subject homes and when one realtor aked one of these appraiser "don't you need interior photo's" the answer was "no you have those posted in the MLS" These screwballs aren't even going into the homes. None of the information they use is verified, all the comps photo's are downloaded from the MLS and every home they have ever appraised is AVERAGE. Once you see one report you have seen them all. How does an honest appraiser compete with this? I'll tell you, turn them into the State Board. We have started doing that here and word has gotten out. If you are going to do appraisals in this area do them right. I'm not talking about little mistakes. I'm talking about clear violations of licence law. None of us in this area have a problem with anyone coming in from out of the area to do an appraisal but do it right. This will equal the playing field. We all got sick of being told we take to long on the inspection, to long long on the report and being told to stop being to picky on the condition because Mr cut rate appraiser never does. We have been scolded for taking a week on an assignment when these other appraisers are getting them done in 12 to 24 hours and they have to travel from over 2 hours away. As of today 5 of these appraiser have had license suspensions and anothre 7 are currently going in front of the board. There is a group of 5 differnt appraisal companies in this area all of who have at least 3 more complaints we are filing. Since all this has started all of our work load has increased and fee's have gone up. Now the appraisers that are coming from those same distances are good appraisers. We all share informaion and work well together. I had an appraiser stop by the office this morning that traveled 3 hours to get here. It was nice to see they cared enough about the job to stop and ask about the market and verify some sales we had done. Not once did any of those cut rate appraisers even call to verify a sale. If all of you good appraisers took a stance against the bad appraisers I think you would see things change for the better very quickly.

 

[morris wetherington]

They quietly steal your money while you quarrel amongst yourself. Laughing all the way to the bank. While your left in poverty and without work wondering what happen. Ye that are to proud to stand with your brother it is you that shall reap the whirlwind.

 

[peteles]

I don't know if anyone out there is noticing

The AMC's are HIRING appraisers to work as staff. One of the job sites on this board's poster will pay a staff appraiser $55,000 per year (far below what an appraiser would receive for the jobs completed). How are the AMC's getting away with hiring staff. Are we all doomed? Being in a large metro area, I am having a difficult time finding any companies willing to pay more than 50% fee split. This is after 25 years of appraising. it would be nice to find some AMC's who are honest and covet the work of a good appraiser. They all worry about losing clients when they don't bring value in just like before the HVCC. What a joke this biz has become.

 

[peteles]

The State of California

In any business you have good and bad. Appraisals are not different. A large group of us in our area have found that we have appraisers traveling from hours away and completing appraisals in a fraction of the time and for half the fee of what our local appraisers are doing it for. Why would some of these AMC's hire us? If the loan goes bad they have an appraiser to blame and these cut rate appraisers are makeing them alot of money right now. Our local guys are working nights and weekends to complete 5 to 8 reports a week in our rural area. These cut rate appraisers are bragging how they complete 15 to 25 reports a week. They are makeing money on volume. Needless to say the AMC's are going to hire these guys. I've been told by several realtors and home owners in the area that these appraisers don't measure there subject homes and when one realtor aked one of these appraiser "don't you need interior photo's" the answer was "no you have those posted in the MLS" These screwballs aren't even going into the homes. None of the information they use is verified, all the comps photo's are downloaded from the MLS and every home they have ever appraised is AVERAGE. Once you see one report you have seen them all. How does an honest appraiser compete with this? I'll tell you, turn them into the State Board. We have started doing that here and word has gotten out. If you are going to do appraisals in this area do them right. I'm not talking about little mistakes. I'm talking about clear violations of licence law. None of us in this area have a problem with anyone coming in from out of the area to do an appraisal but do it right. This will equal the playing field. We all got sick of being told we take to long on the inspection, to long long on the report and being told to stop being to picky on the condition because Mr cut rate appraiser never does. We have been scolded for taking a week on an assignment when these other appraisers are getting them done in 12 to 24 hours and they have to travel from over 2 hours away. As of today 5 of these appraiser have had license suspensions and anothre 7 are currently going in front of the board. There is a group of 5 differnt appraisal companies in this area all of who have at least 3 more complaints we are filing. Since all this has started all of our work load has increased and fee's have gone up. Now the appraisers that are coming from those same distances are good appraisers. We all share informaion and work well together. I had an appraiser stop by the office this morning that traveled 3 hours to get here. It was nice to see they cared enough about the job to stop and ask about the market and verify some sales we had done. Not once did any of those cut rate appraisers even call to verify a sale. If all of you good appraisers took a stance against the bad appraisers I think you would see things change for the better very quickly.

Doesn't do this to appraisers.

 

[peteles]

Enforced how?

This from the email marketing the AI's webinair addressing the House bill:

Financial Reform Legislation: Appraisal and Real Estate ImpactsThis upcoming webinar will provide the details of the pending Conference Report on H.R. 4173, the Restoring American Financial Stability Act of 2010. This legislation, if enacted, would mark the first modernization of Title XI of FIRREA since 1989, addressing several issues of concern to the appraisal community.

In particular, an amendment backed by the Appraisal Institute and its partner professional appraisal organizations was accepted by the House-Senate Conference Committee last week that effectively defines “cram downs” of appraiser fees as an “unfair and deceptive” practice under the Truth in Lending Act. Under the amendment included in the final Conference Report, evidence of “customary and reasonable” fees would include government fee schedules and independent studies that exclude appraisal orders from known appraisal management companies.

How "bout that!

Who is going to make this happen.. Will we have to police it and turn everyone in?

 

[Donald Martin]

Alamode study seems low to me at first, but given that it includes an average from the newbie to the oldie, it's probably in the ballpark.