How to Fight AMC Abuse of Appraisers

[George Hatch]

You can't make an indoor cat out of an outdoor cat.

 

[CGinMN]

Speaking of battered spouse syndrome, I find these to be such odd and oppressive values for an appraisal company to espouse. It's like they're weeding out anyone with a shred of self-respect.

 

[CGinMN]

You gotta "embrace the suck" and "do what is necessary" is not something you want to hear from the hiring manager during an interview.

 

[Mejappz]

The hidden costs of appraisal management companies (AMCs) in the real estate industry have faced growing scrutiny, as highlighted by a recent Business Insider article titled “The Hidden Middleman who cost homebuyers $12 billion dollars and counting.” The article examines the opaque practices of AMCs, which frequently charge exorbitant fees that can exceed the amount paid to the appraiser. As highlighted by former Appraisal Institute CEO Cindy Chance, this issue has faced significant resistance from entrenched interests, mirroring the challenges faced in other industries such as the pharmacy benefit manager (PBM) sector, which ultimately led to an FTC investigation.

The Appraisal Regulation Compliance Council (ARCC), co-founded by Josh Tucker, has meticulously collected evidence of this fee disparity, revealing instances where AMCs like Class Valuation, Clear Capital, Solidifi, and Nations Valuation Services have charged fees that match or exceed the appraiser’s compensation. In one striking example, an appraisal managed by Solidifi for a single-family home in California listed the appraiser’s fee as $375, while the AMC’s fee was a staggering $725. Estimates suggest that AMCs could have charged consumers approximately $12.3 billion over a five-year period, with Solidifi reporting margins of up to 28% after subtracting appraiser payments and other transaction costs. While AMCs argue that their fees are justified by the additional services they provide, such as quality control, a 2018 Federal Housing Finance Agency working paper found no clear evidence of systematic quality differences between AMC and non-AMC appraisals.

The Shadowy AMC Fees Draining Billions from Homebuyers

Regulators & industry stakeholders must act to ensure the appraisal process is transparent, fair, & serves the best interests of homebuyers.

appraisersblogs.com

 

[Surf Cat]

Speaking of battered spouse syndrome, I find these to be such odd and oppressive values for an appraisal company to espouse. It's like they're weeding out anyone with a shred of self-respect.

View attachment 95323

See? The abusive boyfriend came home right when the wet behind the ears appraiser was about to throw their hands in the air and quit....

 

[Joe Flacco]

What happened to this appraiser falls squarely on him. He made the decisions he did.

 

[Joe Flacco]

You can browse Facebook and Reddit and see that there are probably many just like this guy. There are many saying they are doing 50-60 appraisals per month. They don't seem to think that they are being abused by AMC. They seem happy and proud of what they do.

 

[J Grant]

You can browse Facebook and Reddit and see that there are probably many just like this guy. There are many saying they are doing 50-60 appraisals per month. They don't seem to think that they are being abused by AMC. They seem happy and proud of what they do.

It's hard to believe those numbers, especially in this slow market.

 

[Surf Cat]

It's hard to believe those numbers, especially in this slow market.

Oh, I believe those numbers.

Runners are sent to inspect and measure the property. Before jetting off to the next inspection, they send the photos and information to the report writers who in turn send it to the signer as "did inspect". Then they all share in the pot of gold.

The AMC system loves the dregs. They don't value an appraiser well-versed in all faucets of appraisal through education. These types are the friction that get in the way of a fast, rubber stamped report.

 

[George Hatch]

All forms of due diligence add friction to the loan production function.