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

[Mike Kennedy]

Thank you Dave Biggers, alamode, and WORKING RE MAGAZINE


Editor's Note: New state and federal regulations requiring fair fees for appraisers, combined with new data detailing median appraisal fees by county for non-AMC work, may provide the tools necessary for appraisers to take back control of their fees.

HVCC: Taking Back Control of Your Fees
by David Brauner, Editor

"Frustrated with low-ball Appraisal Management Company (AMC) fees, appraisers are digging in, many refusing to work for less, some calling for a national strike to prove their point - but there may be a better way, such as knowing what appraisal services are worth in your market and demanding it. New regulations requiring fair pay for appraisers coupled with verifiable data on median appraisal fees nationwide may make this dream a reality.

Knowing what is fair is more than idealism: it has a practical application given the slew of federal and state regulations requiring that fees be customary and reasonable, including new FHA guidelines and new proposed federal legislation, Financial and Mortgage Industry Reform Bill, (find the bill at WorkingRE.com, Sidebar: HR 4173). Many states also have incorporated similar language into legislation to regulate AMCs and in support of appraiser independence. So far, enforcement of "customary and reasonable" has not been clarified nor challenged but it may be soon.

To date, appraisers have had a weak hand when negotiating fees with AMCs. Indeed, with too many appraisers chasing too few orders, and with their lender/mortgage broker clients removed from the process by the Home Valuation Code of Conduct (HVCC), appraisers say that jobs flow mostly to the lowest/fastest bidder these days and at fees that are far below what was "typical" for their market less than a year ago before HVCC took effect. Now they have data to prove it."

View the completed Appraisal Fee Reference report at mercuryvmp.com/analytics.

http://www.workingre.com/workingre/taking-back-control-of-your-fees.html

 

[mopickled]

Thanks Mike
The word in NC is that since HVCC, the average "appraisal fee" on Hud1's has been around $550 - thanks AMC's- or should I say your welcome.

The VA survey showed them that an adequate fee was to be set at 400 clams for the NC market. That has been a good benchmark for me with some clients willing to charge the borrower even more to cover Aport fees etc.

 

[Kathleen O. Farrelly]

FHA

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.

 

[mopickled]

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.

Newbie appraiser likely still in college - 3 roomates and still living on beer and pizza - 10yr old car that Mommie paid for years ago, using Mommies MLS access- or just making up the data!! They can't last forever and even they will find a better job sooner or later when the car finally gives out.

As long as FNMA keeps buying this crap it ain't gonna change much, but it will change one way or the other I suppose when the lenders lose ALL of their investors because their product smells like HAWG MANOOR and is worth even less.

 

[paulina]

I got a call from an AMC yesterday and they wanted me to sign up with them and agree to the fee of $275 for FHA appraisals. I told them that my "customary fee" was between $400 and $450. and reiterated the FHA guidelines about paying customary fees. These guys have it made, because NO ONE at FHA is going to be checking up on them to see if they pay appraisers the "customary fees". What a joke this has become. It it wasn't so sad, it would really be a joke !!!

 

[William K]

m2: and here in Illinois we are the race to the bottom leaders. I'm sure we will lead in the $55 dollar Desktop appraisals too.

I talked to a lender last week who runs there own rotational panel and said he had 2 of the panel appraisers call to say they would accept $25 less if they could get more work so he is reducing the fee across the board by $25.

If appraisers were a type of animal in Illinois we would be nearing extinction for eating our own!:new_all_coholic:

 

[Pam Wyant]

Thanks for posting this Mike.

 

[awesomejob]

We are our worst enemies, instead of working in a consolidated effort to improve the industry for all participants. They can't achieve anything without us.

 

[TennMan]

This is a great reference for appraisers.

 

[jnordquist]

I have to question the PA Allegheny County (Pittsburgh) fee of $275, rmailing Alamode/Mercury to have this double checked