Hybrid Appraisals

[J Grant]

You're missing the point: I lose assignments to my competitors because my clients also have options, even if they're dealing in smaller volumes and with a smaller pool of competing vendors. As well, my clients compete with each other and they lose deals to their competitors every week.

The scale is different but the fundamentals of supply/demand remains the same. Capitalism.

You have a more diverse set of client options due to commercial interest, and there is no SAME Supply and demand when AMs are involved. scale being different is enormous, like comparing a boulder to a pebble and saying they are both rocks.

It is a whole different dynamic bidding directly to a lender customer or other user of appraisal services than bidding to res mortgage AMC 's..for orders


Capitalism with a free and open market is not in play when AMCs have a huge competitive advantage: a small number of buyers ( demand) vs. a large number of sellers (appraisers) thanks to JHVCC and then DF regulation, which is NOT normal capitalism.

 

[J Grant]

How have I ever ignored anything?

The appraisers are all about the fee. The AMCs are all about the fee. And the lenders are also all about the fee in that they don't want to carry staff and overhead when the volumes won't support them.

Nobody in this loop is putting principle ahead of profits, and that includes the fee appraisers. Nor am I "batting for the other team" in acknowledging that reality.

Because you only single out the appraisers for being hypocrites ( in your eyes ) when they talk about quality or public trust, you always pipe up with ( it is all about the fee ! ) as if the two concerns do not coexist at the same time.

You do not simply acknowledge reality, we are all aware of the reality, you normalize their profiting of the backs of lower-paid appraisers s "just business" when it is not normal business practice to have a highly manipulated supply and demand dynamic influencing fees due to the regulation of HVCC and then DF, limiting who can order an appraisal

 

[George Hatch]

The SFR lenders can go to direct engagement. But most of them don't. Because they have alternatives.
The non-SFR lenders can go to direct engagement. But most of them don't. Because they have alternatives.

 

[Terrel L. Shields]

Meanwhile, appraisers continue to be begged to perform hybrid assignments for fees less than $300 for a URAR

$275 going rate in NW Arkansas which is very busy, and I don't know of any appraisers not keeping relatively busy. You would think in the face of strong building that the price could be maintained much higher by the shear volume of work. I keep thinking what was the cost of a form filling program in the mid-90s when we were getting $325 an appraisal vs today? Yeah, we can prepare a report faster. I get it. But the improved technology comes at a price....except when it comes to appraisal.

if I were younger, I would be retraining for a different career.

Anyone under 50 should re-evaluate their situation and find better employment than simple fee appraising offers.

Some appraisers will go the staff route which seems miserable with mediocre pay for high stress volume production

A job within a bank is a staff route that is far superior to any staff job offered by an AMC. Bank employees are never known for high pay outside the CEO and top brass but the pay is typical in a given community and has health and retirement benefits that an AMC rarely offers.

The scale is different but the fundamentals of supply/demand remains the same.

My only disagreement is that appraisers should be treated differently. We are not. Why should we? Because we are tasked with the job of arbitrator of values. Like a judge we shouldn't be taking sides. And, we should not have the pressure of pricing that impacts our value as such neutral observers. Judges are not supposed to be certain parties - the law in many states. Judges are held to a standard of conduct just like us. Our services should not be subjected to fee shopping. And the question is how good is the job done when the fee is inadequate to do anything more than "kite the check" and keep you in business a few days more hoping for improvement. If the regulators were required to review every report where the fee was in the lower quartile and punish any such report that was subpar, then appraisers would not bid low and if they did, would have to still do good work. I've heard too many people say over the years that "for that fee I cannot afford to do xxxx and I just assume otherwise." I had one guy tell me he NEVER valued a property for less or more than the contract because he didn't want to defend his opinion. So, unless it was entirely outrageous pricing, he was going to be exactly on the contract price. Bid low bring in the contract price, get reviewed and see how many appraisers either fold or change their ways. The present system does not work. Fees too often dictate outcome quality regardless someone can post a report where the low fee report was superior to one that cost an arm and leg.

 

[J Grant]

How have I ever ignored anything?

The appraisers are all about the fee. The AMCs are all about the fee. And the lenders are also all about the fee in that they don't want to carry staff and overhead when the volumes won't support them.

Nobody in this loop is putting principle ahead of profits, and that includes the fee appraisers. Nor am I "batting for the other team" in acknowledging that reality.

We are well aware of the reality. What you ignore are the causes of it—and that the lenders who use AMCs get their staff and overhead reduced on the back of appraisers due to the lender not having to pay the AMC a hard cost—which would wipe out the AMC's unfair advantage overnight if lenders had to pay them a hard cost for their management service.

 

[J Grant]

The SFR lenders can go to direct engagement. But most of them don't. Because they have alternatives.
The non-SFR lenders can go to direct engagement. But most of them don't. Because they have alternatives.

You act like the alternatives are some nuetrail thing. They are not neutral, they are rigged against appraisers due to the facts I have bought up numerous times here.

 

[George Hatch]

Because you only single out the appraisers for being hypocrites ( in your eyes ) when they talk about quality or public trust, you always pipe up with ( it is all about the fee ! ) as if the two concerns do not coexist at the same time.

You do not simply acknowledge reality, we are all aware of the reality, you normalize their profiting of the backs of lower-paid appraisers s "just business" when it is not normal business practice to have a highly manipulated supply and demand dynamic influencing fees due to the regulation of HVCC and then DF, limiting who can order an appraisal

Any appraiser who exercises the principle of substitution in any aspect (let alone every aspect) of their appraisal business is being hypocritical when they complain about their clients doing the same. People tend to act like people. It is irrational and illogical to expect otherwise of people. Nor is it a disparagement to acknowledge the obvious.

 

[djd09]

and all of this makes USPAP useless...and taf corrupt...give me the pen and eraser and i will fix it all

 

[George Hatch]

You act like the alternatives are some nuetrail thing. They are not neutral, they are rigged against appraisers due to the facts I have bought up numerous times here.

"Rigged" in that the feds prohibited the lenders from using appraisals that are engaged and controlled by the loan originators, whether at the lender or an outside brokerage. As they had done on the CG side 15 years earlier. They didn't even create a new rationale for doing it; they cited the same rationale they used for the FRTs. The loan salesman has no business talking to an appraiser or even touching an appraisal until they get a copy of the report.

The feds weren't thinking about the well being of appraisers when they did that in 1992 or in 2008 because - newsflash - appraisers' lives don't matter to anyone other than appraisers.

As for the lenders not being prohibited from using the bundled fee model, the blame for that goes to the govt not enacting such a prohibition. Not on the lenders for exercising their legally-permitted alternatives.

I've been saying this for many years. You need the govt to intervene in this area of commerce to give to appraisers the protections for their business interests which they are incapable of winning for themselves in the marketplace. Because short of additional govt meddling the principals in these transactions are going to continue to operate in what they perceive to be their own best interests. AKA people acting like people.

 

[J Grant]

Any appraiser who exercises the principle of substitution in any aspect (let alone every aspect) of their appraisal business is being hypocritical when they complain about their clients doing the same. People tend to act like people. It is irrational and illogical to expect otherwise of people. Nor is it a disparagement to acknowledge the obvious.

. Appraisers have so little leverage compared to the highly funded and powerful AMC and lender lobbies that accusing us of being hypocritical is absurd. There is no hypicry in stating teh fact that teh supply and demand dynamics of a large volume of orders with a small scheme of effective demand ( the AMC ) was the overnight change after DF banned individual loan officers from ordering appraisals. Your refusal to acknowledge that is evident..

Overnight, appraisers saw their own clients shift to AMC, and the appraiser was doing the same work for their former clients at half the fee due to DF, seeing the AMC order since loan officers could no longer do so. That s not like any other businessf wrt free market catilsim supply and demand.
You act like residential mortgage rendering orders or alternative is subject to the same supply and demand as free market business or the non AMC side of appraisals.