Hybrid

[George Hatch]

I don't think there's any comparison between what a local credit union does vs what a national big box does.

So you believe that the big box lenders who have gone with the AMCs that shop by fee wouldn't do the same if it was their own clerk looking to fill the orders instead of the AMC clerk? And that shpopping by fee was created solely by AMCs?

 

[J Grant]

I don't think there's any comparison between what a local credit union does vs what a national big box does.

So you believe that the big box lenders who have gone with the AMCs that shop by fee wouldn't do the same if it was their own clerk looking to fill the orders instead of the AMC clerk? And that shpopping by fee was created solely by AMCs?

There are national level lenders now ( they order from me so I know first hand ) that do NOT fee shop out each order. They either pay their panel a reasonable C and R fee per regional area, or appraiser puts their fee on the portal and as long as it is C and R for area, lender pays it. These are NOT small credit unions. And some small credit unions use AMC;s so your argument that Credit unions behave differently makes no sense. Some order direct, other use AMC's just as some lenders do.

Fee shopping to generate PROFIT from the assignment back to the AMC belongs to the AMC model , which is different than a direct order lender being aware of reasonable fees and using appraisers who charge them- in a direct order model the borrower covers appraiser fee so tell me why would they pay a clerk to "fee shop" individually by order to find someone cheaper? You know that is not how they do business and it would be inefficient and ridiculous for them to do so.

Are you not capable of comprehending, that the reason AMC's fee shop for lower per individual order is because it directly impacts their profit, whereas a direct order lender/client is not making a profit, therefore lacks that motivation? They want to obtain appraisals at a reasonable cost covered by borrower, end of story.

Are you telling me that you actually can not comprehend the difference in motivation ? ( and law, since a lender can't fee split with itself, only with a third party ..which is why some own a "captive" AMC for that purpose.

 

[J Grant]

I don't think there's any comparison between what a local credit union does vs what a national big box does.

So you believe that the big box lenders who have gone with the AMCs that shop by fee wouldn't do the same if it was their own clerk looking to fill the orders instead of the AMC clerk? And that shpopping by fee was created solely by AMCs?

Do you actually believe national lenders would pay a clerk to fee shop each order if said lender was not using an AMC? Since the lender can not fee split with itself, what would the lender do if the clerk found someone cheaper than what the loan officer quoted borrower at application, refund the cheaper by $25 appraisal fee to the borrower? (rhetorical question if is ridiculous)

National lenders, mid size lenders and small/credit unions operate more or less the same at point of application...their loan officers have a list of fees paid in an area for title, credit, appraisals etc and put them on a good faith estimate for the borrower. The borrower is mostly concerned with interest rate and what they can get approved/qualify for. The fees are a big blur to them and the loan officer tries to get the borrower to sign, the last thing a loan officer wants is to stop mid way to see if they can find an appraiser for $25 cheaper. ...why not search for $25 title service while they are at it.. it would be inefficient, unprofessional to borrowers , absurd.

Virtually only the AMC individually fee shops (or uses an logarithm/app ) each order to find a cheaper appraiser, whether by large or small margin- since their profit is generated from doing so. Something you refuse to acknowledge - why?

 

[George Hatch]

I do nothing but direct engagement and I can tell you for a fact that the appraisers on these panels don't get all assignments they bid on. The sizes of those panels aren't numbered in the thousands, either; or even in the dozens. The amount of the fee is almost always an issue unless they think they need a particular appraiser to perform the assignment regardless of the fee. It should go without saying that my end of the business is nowhere near as competitive as your end.

Don't delude yourself into thinking these massive lenders are somehow oblivious to what they have been getting from the appraisers for the fee splits they are paying to them. No AMC could brutalize an appraiser's fee without the explicit approval of the lender.

As well, you shouldn't delude yourself into thinking that an appraiser who is sitting idle for a week won't lower their fee in order to draw some work in, which is a simple thing to do when they're enabled to spread the word around across the various ordering platforms they operate in.

I predict that when taking the rock (oversupply of capacity) and the hard place (loss of 1004 market share to alternate workproducts) to its logical conclusion we're eventually going to see a new normal that most appraisers won't like.

 

[Terrel L. Shields]

$25? Is that the bonus? Surely not a real fee.

No more credit at the liquor store
Don't guess I'll go there anymore

 

[J Grant]

I do nothing but direct engagement and I can tell you for a fact that the appraisers on these panels don't get all assignments they bid on. The sizes of those panels aren't numbered in the thousands, either; or even in the dozens. The amount of the fee is almost always an issue unless they think they need a particular appraiser to perform the assignment regardless of the fee. It should go without saying that my end of the business is nowhere near as competitive as your end.

Don't delude yourself into thinking these massive lenders are somehow oblivious to what they have been getting from the appraisers for the fee splits they are paying to them. No AMC could brutalize an appraiser's fee without the explicit approval of the lender.

As well, you shouldn't delude yourself into thinking that an appraiser who is sitting idle for a week won't lower their fee in order to draw some work in, which is a simple thing to do when they're enabled to spread the word around across the various ordering platforms they operate in.

I predict that when taking the rock (oversupply of capacity) and the hard place (loss of 1004 market share to alternate workproducts) to its logical conclusion we're eventually going to see a new normal that most appraisers won't like.

First part your your post do you mean direct engagement commercial or complex- that is not the issue at hand for reg assignments/AMC work, o why introduce it as a parallel?..

Future -if 1004 drops volume yes it might be bad...which is why every fee counts, whether for a 1004 or other product. Future might depends on what other work products there are and if more desktop appraisals evaluations are ordered than we see now...I think appraisers are aware of this and some would exit, since there is no way to "adapt" to a vastly lower earnings outlook - if that becomes reality your wish will come true of less appraisers remaining..

back to today, I realize lenders are not oblivious to AMC's taking brutal share of appraisal fee, as you put it, ...you often state things we are well aware of. Perhaps some of those lenders profit by owning an AMC or owning stock in one, or they don't care. Other lenders do a cost breakout model instruct an AMC to pay rates to appraiser that are reasonable..other lenders do not use an AMC and order direct.

 

[George Hatch]

First part your your post do you mean direct engagement commercial or complex- that is not the issue at hand for reg assignments/AMC work, o why introduce it as a parallel?..

Not a parallel but rather a more extreme example of my point - IRL appraisers compete with each other on fee. The more efficient the tech-enabled point of purchase is the more efficient the competition will be. Eventually leading to more fee volatility - higher fees today because people are busy, but lower next week when not as many of them are busy.

As for what is "my wish" I'm going to challenge you to summarize what you think it is what I want for you and everyone else. Put up of shut up.

 

[J Grant]

I was being a bit sarcastic...I don't know what your wish is,you are free to express it, I hope it is positive! I am arguing with some of the things you say and the denial of certain truths, which is that AMC profit motive is what decimates fees not merely over supply, such as when the supply of appraisers is the same in the same region, an AMC might pay $250 and a direct lender pay $450 to appraiser ( borrower is paying $450 or more in both cases )

 

[Carnivore]

Interesting that we just went through a AQB Educational change because of a potential shortage of RE Appraisers. I think this was spurred totally by the recent huge demand for REFI, sans Appraisers. So the AQB reacted. Now there is apparently a lull and we have an excess...OK where is the AQB? Seems like they should be responding by upping ED Requirements.

So it begs the question: AQB Why are you even responding to these cyclic markets at all?

Maybe FNMA is on to something. When times are hot(lots) of Refi's go to a desktop, when times are slow fall back to 1004's.

 

[J Grant]

Not a parallel but rather a more extreme example of my point - IRL appraisers compete with each other on fee. The more efficient the tech-enabled point of purchase is the more efficient the competition will be. Eventually leading to more fee volatility - higher fees today because people are busy, but lower next week when not as many of them are busy.
.

Sorry but this is a deflection the topic away AMC impact on standard lender work fees, and is not the same as appraisers competing with each other for a larger scale $ commercial assignment with wide latitude of what appraisers charge .