• Welcome to AppraisersForum.com, the premier online  community for the discussion of real estate appraisal. Register a free account to be able to post and unlock additional forums and features.

Effects of this reform on our fees?

Status
Not open for further replies.

RNMOVR

Thread Starter
Sophomore Member
Joined
Jun 14, 2007
Professional Status
Certified Residential Appraiser
State
Louisiana
I have have spent hours reading threads on AF, news articles, FNMA/FMAC web pages, and AI responses to the Home Valuation Code of Conduct. I have yet to find anyone else concerned with the financial ramifications of limiting our clients to AMCs. I agree with the steps they are taking toward appraiser independence and fraud. And I know this sound very mercenary, but at the end of the day how is this going to affect the ability for us to maintain our current incomes?

The few AMCs that I deal with typically pay approximately 33% less than the market average. So I am looking at potentially taking 33% cut in revenue. I see several ways this could play out. One is that we will be forced to accept reduced rate fees from AMCs because they now have a monopoly. Two is that now that they have a monopoly, the market rate for an appraisal goes up and they charge the client more and my fees remain at full price. The AMCs would be so flooded with business that their current Skippy couldn't possible handle the volume. The benefits to scenario two is that my potential client base will be much smaller and more centralized. Therefore, instead of courting every mortgage broker/banker in town, I can get a larger volume of work from a much smaller client base.

Minus the reduced fees, I like doing work for AMCs. There is typically no pressure or estimated value and they pay on time every time. If they don't, there is a corporate structure to address. As long as you meet their deadline expectations, they are typically much lower maintenance that a local mortgage broker. We as appraisers should be meeting our clients deadlines regardless because they are considered to be part of the scope of work (if they are noted on the request). If any one here has any information (not personal opinions) or links addressing the effects of this reform on our fees by the AI or any of the other professional organizations that are supposed to be there to protect our interests as a profession. Please share them with us.

In addition, the AMCs know this is coming and I have already had one try to get me to reduce my fees even lower to guarantee my position for this new potential business. I personally find this to be disheartening. I have chosen the appraisal profession out of desire and not as an alternative to college. I did not pursue this field until I graduated from college and became aware of this industry. The haggling over our fees make me feel like a cheap prostitute on corner having some John haggle over my fee for a quickie. I make a good living off of what I do, but I put the time and dedication into each and every report (regardless of fee). So I do take offense at someone discounting what my time and knowledge is worth. I truly feel our industry has been diluted with wanna-be appraisers who thought: well I could go to college for 4 years or go to appraisal school for 4 months. Anyway, any qualitative feedback from my peers would be appreciated.
 
Last edited:

Ray Miller

Elite Member
Joined
Feb 20, 2002
Professional Status
Licensed Appraiser
State
Wisconsin
I feel it should never be up to the lender or AMC to set fees or turn times. If you want to be an employee then work for them and get the benifits that are due an employee.

If they want to hire an independent contractor then let that contractor be independent.
 

DWiley

Elite Member
Joined
Apr 4, 2007
Professional Status
Certified Residential Appraiser
State
Tennessee
So I do take offense at someone discounting what my time and knowledge is worth

I have seen many posts that expressed similar thoughts. Who sets the fee? The appraiser. If the appraiser agrees to a lower fee, it is the appraiser that has discounted what his/her time is worth.

Do some work for clients who really want an appraisal (as opposed to clients required to have one) and you will be pleasantly suprised how much you can charge for your time.

The low hanging fruit is easy to pick, but usually not the best on the tree.
 

Elliott

Elite Member
Joined
Apr 23, 2002
Professional Status
Certified General Appraiser
State
Oregon
I've thought about all those changes too. I see no difference in my
fees, unless demand for appraisal service increases
significantly.
 

Riick

Elite Member
Joined
Aug 14, 2007
Professional Status
Certified Residential Appraiser
State
Delaware
What does your local auto repair shop charge for work
- their hourly rate is usually posted on the wall.
$70 $80 $90 ?? It sure ain't $50.

What does it cost to get a Plumber to look at your plumbing problem?
- That's a "Trip fee" at maybe $100 and up.

Appears to me that most appraisers are stuck in a time warp on pricing.
Idiots come in all flavors
 
Joined
Jul 15, 2003
Professional Status
Certified Residential Appraiser
State
Connecticut
DW,

I agree and disagree; if it were a true open market then I would agree with your first point, the supply vs. demand would dictate the market fee. However, if the AMC has advantage over the market price (supply vs. demand) the AMC can use that to leverage a price point, as they do now. Now if the powers to be (via the agreement), this will give the AMC power (demand) they can use that power to leverage to lower the price point (we have all the work, we tell you how much we pay, take it or leave it). If all of the lending work will be forced to be offered though one or two avenues, the appraiser will have little leverage to dictate a true open market fee.

I agree with points 2 and 3.

AMC’s = power, power = lower fees (take it or leave it). Now we are back to squire one again.
 

RNMOVR

Thread Starter
Sophomore Member
Joined
Jun 14, 2007
Professional Status
Certified Residential Appraiser
State
Louisiana
I have seen many posts that expressed similar thoughts. Who sets the fee? The appraiser. If the appraiser agrees to a lower fee, it is the appraiser that has discounted what his/her time is worth.

Do some work for clients who really want an appraisal (as opposed to clients required to have one) and you will be pleasantly suprised how much you can charge for your time.

The low hanging fruit is easy to pick, but usually not the best on the tree.

What I meant to say is that I am offended by clients wanting to haggle over my fees. As if I am a two bit *****. Do you negotiate your attorney's, CPA's, or even local car wash's fees. No!! The issue behind this post is whether or not will we loose the ability to control our fees and still stay in business. It could come about that what I feel my time is worth is irrelevant because the ACM has a 30 person list that I am just a number on. There will be no orders given on experience or rapport. So every relationship that I have established with local mortgage broker/bankers and realtors have been a waste of time in the sense of continued business.
 

Kevin Mc

Elite Member
Joined
Jun 7, 2004
Professional Status
Certified Residential Appraiser
State
New York
I have yet to find anyone else concerned with the financial ramifications of limiting our clients to AMCs. I agree with the steps they are taking toward appraiser independence and fraud. And I know this sound very mercenary, but at the end of the day how is this going to affect the ability for us to maintain our current incomes?

You haven't seriously delved into the board. We are all concerned and there are 1000s of posts that address it. Get reading and you'll see how many are going to attempt to address. Enjoy the read.
 

Riick

Elite Member
Joined
Aug 14, 2007
Professional Status
Certified Residential Appraiser
State
Delaware
What I meant to say is that I am offended by clients wanting to haggle over my fees. As if I am a two bit *****. Do you negotiate your attorney's, CPA's, or even local car wash's fees. No!!
Errr.. error error the answer is YES.
I get a fee quote, and if it is too high I negotiate or go elsewhere if possible. Note key word underlined.

The issue behind this post is whether or not will we lose the ability to control our fees and still stay in business.
On the bright side, If you can afford to stay in business to subsidize
the AMCs, you're allowed to put an additional set of letters behind your
name. Joe Smite, RIA The "RIA" stands for "Real Idiot Appraiser"

It could come about that what I feel my time is worth is irrelevant because the ACM has a 30 person list that I am just a number on.
Let's try 3,000 or 230,000 person list - who needs geographical competence?

There will be no orders given on experience or rapport. So every relationship that I have established with local mortgage broker/bankers and Realtors have been a waste of time in the sense of continued business.
Unfettered AMCs will eat your lunch, my lunch, and (eventually)
put themselves out of business, as appraisals and appraisers
-to the lending community-
will be even more of a joke than they are today.
Notice key word underlined.

We have rules, lenders have rules, AMCs - no rules there that I know of
--> just naked capitalism.
And when it comes down to something like the "Big 3" AMCs
<whoever they might eventually be>
covering 70-80% of the loans made.
Can you say the words "wage slave" ???

Check out what PAM is doing - the one hope I can see;
Might even save the business more-or-less as we know it.
.
 
Status
Not open for further replies.
Find a Real Estate Appraiser - Enter Zip Code

Copyright © 2000-, AppraisersForum.com, All Rights Reserved
AppraisersForum.com is proudly hosted by the folks at
AppraiserSites.com
Top

AdBlock Detected

We get it, advertisements are annoying!

Sure, ad-blocking software does a great job at blocking ads, but it also blocks useful features of our website. For the best site experience please disable your AdBlocker.

I've Disabled AdBlock
No Thanks