Low fees

[terr]

Why is everyone always trying to get valuation fees down to the cheapest price possible, far below any working wage. Next the fee will be 1 cent. We will soon have incomes of the third world countries if we let this continue.

So many are trying to circumvent the appraisers job and pay as little as possible for needed services. This happens in no other field.

Who the H____ started this. When will it end so we can get our lives' back.

I read recently that there were tens of billions of dollars paid out in brokerage fees but no one ever cares.

But just let an appraiser try to earn a living and try to support his family
and everyone is against that driving fees down as much as possible to slave labor wages.

Can you imagine Lawyers, Drs. Plumbers, etc geting $15 for their services?
How long would that go on? Yet we let this go on and on and on.

At least everyone in this forum should take a stand against this and do something about it. One person can make a difference.

 

[Restrain]

I was working for AMCs back in the early 80's. The problem is that their fee back then wasn't much less than what I was getting from the local bank. The bank fees have gone up but the AMC fees have not.

As to why, the bottom line is that Fannie/Freddie don't want appraisals. If you don't believe me, check out their changes in regulations regarding appraisals and lending. They even fought the changes after the abuses of the 80s.

Roger

 

[Tim Hicks (Texas)]

I would bet many of the AMC's are run by appraisers or former appraisers or some person linked to the appraisal process that saw a big bag of money for themselves while little bitty bags for everybody else.

 

[Rob Bodkin]

We don't take any work from AMC's, or from people who call up price shopping. Our fee structure is reasonable and we don't work for less, just to get the new business. That means of course that occasionally we have to do a little networking to attract more business, but not in the past few years.

My dad, who trained me, hates doing any marketing of his services and does do work for AMC's. I think it's too bad that he effectively works for a fee split because he hates drumming up business.

I'd rather develop relationships here locally and do a little schmoozing occaisionally than work for some faceless cog in the corporate wheel in Duluth or Fargo for 70% of what I charge a loan rep whom I can have lunch with or take fishing.

my 2 cents

Rob Bodkin
Freestone Partners

 

[Richard Carlsen]

I do a lot of work for some very good, very responsive, very fast paying AMC's. And all of this work is at MY FEE SCHEDULE, not something they come up with. Once in a while an order will come in with the wrong fee on it. We simply make the correction on the order, fax it back and accept the order subject to the correct fee. We have never had them balk at paying our fee.

I think there are two reasons for this.

Number 1 is that there are not a lot of appraisers up here who will put up with the follow-up calls and status checks that you get. It is a pain sometimes but it is part of their job and I can live with it so long as it does not interfere with my work.

And the Number 2 reason I get so much of their business is I think that over the years they have learned that they can trust what we tell them on the phone and in our reports. I think they are very happy with the timeliness and quality of the work we provide for them.

On the same subject of lowering fees, I've decided that come 2003, I will have a minimum fee for giving an opinion of an improved property value regardless if I do a 2055 interior or exterior or a Limited Appraisal with Restricted Use Reporting. No form gives me any protection from liability. I guess I am not willing to step out on that edge for next to nothing.

 

[Lysander in Charlotte]

I was working for AMCs back in the early 80's. The problem is that their fee back then wasn't much less than what I was getting from the local bank. The bank fees have gone up but the AMC fees have not.

The way AMC's learned to expect discounts is illustrated by RStrahan's example. If anything an order from an AMC is worthy of a premium and certainly not a discount. If you have big heart that just requires you to discount, give the discount to someone local and worthy, not an appraisal broker. If you discount even $10 to an AMC, you acting to the detriment of your own business as well as the profession.

You are what you do. To devalue what you do is devalue yourself.

 

[Michael Reilly]

Terr,

There is only one way to combat this problem and only you can do it, be smarter, faster, consistant and more professional than your competition and then you too can dictate your fee schedule. We do not work for AMC's because we choose not to. There is so much full fee work out there it's scary. With new clients calling us every day our fees continue to climb. The appraisers in our system continue to see their average fee per job climb month over month even with these limited drive-by reports.

This is the time to eat so eat. In fact stuff yourself!

Mike-NY

 

[Keith]

I work for a couple AMCs. They both accept PDF files that save me time and money. I am a one-man shop. The PDF delivery allows me to spend more time appraising and less time printing and shipping. Further, they ALWAYS pay in a timely manner. What is that worth?

In my experience, if you work for a broker they treat you like garbage the first time you "come in low" and simply do not pay 1/2 the time. This is your reward for the hard work of finding a new client. Let's do the math:

10 appraisals at $300 each x getting paid 1/2 the time = $1500. The AMC's pay more than that.

I do not spend time in court fighting for my fees, I am rarely pressured for a value and I am happy with a slightly reduced fee. One AMC I work for pays within 72 hours like clockwork. What is that worth?

What are you guys whining about anyway? Shouldn't we be out appraising?

 

[Lysander in Charlotte]

Keith, let me get this straight. Yor are maintaining that us full fee appraisers who work for local clients have 50% uncollectable invoices? I don't think so. In my case, 100% are collected without hassle. If you actually have 50% uncollectable invoices, there is something drastically wrong with the type of client that you are soliciting. Do you use the same fuzzy math that you used in your anology on the appraisals that you do for your appraisal brokers? If so, its no wonder that they like you and pay in 72 hours.

In my own view, there is no justification for discounting, especially in this market environment. You are not only deminishing yourself, your damaging us all.

 

[John Hassler]

Keith

You got it 100% backwards. I don't work for AMCs because I don't want to split my fee nor do I even want to wait 72 hours to be paid! All clients are COD except for a few long time banks and LOs who pay like clockwork. Do I lose some business? I'm sure I do ... and to people like you ... but this system has worked for the decade I've had it in place. Work smarter, not more hours.

I don't blame AMCs, LO, & banks for trying to get the appraisal fee down, this is America and capitalism rules. I do the same thing all the time when I can get away with it. Most everything is negoiatable to some degree. That said though, I'd rather take a day off than cave in on what I think I'm worth.

Not trying to be mean or harsh but if you think the fee they are offering is too low then don't accept the assignment and tell them why.


John Hassler