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I'm Starting an AMC...Any advice

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Bill75

Bill75

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Supporting Member
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Dec 18, 2015
Professional Status
Certified Residential Appraiser
State
Texas
I have a friend who runs a mortgage brokerage and really does appreciate my work. They have been asking for some decent AMCs to use since they are about to bring in a bunch of work, I told them there really are none. With the several AMCs both of us have done business with, they have been anything but easy to deal with, i.e Low fees, can't get the order in on time (their fault), incompetence... I brought up the idea about starting my own AMC and we think it's a good idea. Anyone have thoughts on this and how one is ran and or the implications. What does it take to run a good AMC and what thoughts do you guys have. I would only carry a Texas license and mainly work with my friend. I despise AMCs, but I think if I treat independents with respect and pay them a more than fair fee, appraisers will be happy. Thoughts on how to run an AMC and how one goes about starting?
 
Research step one: consult your E&O Insurer b4 doing anything else.
 
So this mortgage broker's lender clients would require an AMC I take it?

Devil's advocate here, but would you be hiring other appraisers? If not, don't you think the lenders would get suspicious that every report is done by you?

If you ARE planning on bringing on other appraisers, I would definitely seek legal advise from someone who has helped establish other AMCs. Seems like a tremendous amount of gotchas out there, especially if you plan to continue doing appraisal work yourself...

FTR, I do know of a one person AMC that a multi-billion dollar semi-regional bank in my area uses exclusively. He does very little vetting of the reports, simply serving as a disinterested (assumed) 3rd party for ordering, and updating status of reports. In other words, he is simply a conduit. I've not gotten close enough to anyone at this lender to get more details, and not been able to get this person to add me to the panel yet, but I find it fascinating that he is able to pull this off with all the mega-AMC's out there at present. I 'suspect' there is some buddy buddy going on.
 
i would start by researching parasites. that should answer most of your questions.
 
Bill75 said:
I have a friend who runs a mortgage brokerage and really does appreciate my work. They have been asking for some decent AMCs to use since they are about to bring in a bunch of work, I told them there really are none. With the several AMCs both of us have done business with, they have been anything but easy to deal with, i.e Low fees, can't get the order in on time (their fault), incompetence... I brought up the idea about starting my own AMC and we think it's a good idea. Anyone have thoughts on this and how one is ran and or the implications. What does it take to run a good AMC and what thoughts do you guys have. I would only carry a Texas license and mainly work with my friend. I despise AMCs, but I think if I treat independents with respect and pay them a more than fair fee, appraisers will be happy. Thoughts on how to run an AMC and how one goes about starting?
Click to expand...

Look at your state board law about AMC. There may be a large $ bond amount to start up and a lot of $ in software/systems. Unless your friend owns the company, his well meaning remarks may be nothing more than that, because if the work is in soon they want immediate results and will not wait for you to set up, even if possible for you to actually do it. PM me I can recommend one decent AMC.

You can also inform your friend that if they must use an AMC some suggestions, that they can work on cost plus, aka ask AMC to pay the appraiser X $ for each non complex order and they send AMC Y $, and that they will not give the business to a company that uses blast email bids /other criteria

Do they use Mercury or Appraisal Port that is another option to assign
 
Bill75 said:
I have a friend who runs a mortgage brokerage and really does appreciate my work. They have been asking for some decent AMCs to use since they are about to bring in a bunch of work, I told them there really are none. With the several AMCs both of us have done business with, they have been anything but easy to deal with, i.e Low fees, can't get the order in on time (their fault), incompetence... I brought up the idea about starting my own AMC and we think it's a good idea. Anyone have thoughts on this and how one is ran and or the implications. What does it take to run a good AMC and what thoughts do you guys have. I would only carry a Texas license and mainly work with my friend. I despise AMCs, but I think if I treat independents with respect and pay them a more than fair fee, appraisers will be happy. Thoughts on how to run an AMC and how one goes about starting?
Click to expand...
Before starting an AMC, especially in Texas, I recommend reviewing all the associated regulatory costs. Pay particular attention to the fees to register as an AMC, costs for AMC E&O, and, especially in Texas, the costs of mandatory reviews an AMC must conduct and the fees associated with the rather unique panel management system that is required in Texas. You may find that it is more costly, and not as simple, as you first think. Good luck.
 
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