Our own Magna Carta

[fifteen]

Don Rico : on your #5. Too late. HUD has already changed what RESPA is and they're basically abandoning line item charges in favor of grouping them. Funny how RESPA can change in the blink of an eye when someone somewhere needs validation of previously illegal activities :


As modified, the FAQ now provides that loan document preparation done on behalf of the loan originator is a processing and administrative service in the origination of a loan and is included in Line 801 of the HUD-1 for “our origination charge” and can not be separately itemized. Thus, HUD reversed its original position that a charge for loan document preparation by an attorney must be included in the Line 801 amount and must also be separately itemized. This may well signal that HUD has abandoned its long-standing position that any amount paid to a third party for the performance of a settlement service must be disclosed on the HUD-1.


http://www.pattonboggs.com/news/detail.aspx?news=937

 

[Frederick]

I wouldn't rule anything out relative to fees, employee/independent contract issues, hold harmless agreements, data mining, DeMinimus, etc.

Lay out the problems out and see what their attorneys suggest. It is their area of expertise and they will be able to suggest targets and avenues of approach.

 

[Mike Kennedy]

Appraisers are already empowered to NEGOTIATE an acceptable fee. As long as the "ant army" accomplishes demanded turnaround times based on inherent lack of due diligence and INCOMPETENCY - fighting against the "fee paper tiger" is a losing cause.

Mike,

Please pardon that I paraphrase by reference your entire post however I really would like to focus on your statement above.

I agree that in the PAST appraisers had the ability to negotiate an acceptable fee with most clients. That appears to be happening less and less as the AMCs representing the larger banks offer a take it or leave it approach to fee schedules. Either you sign the agreement and accept the fee quoted per form ordered or you do not receive work. Period. Moreover that is presently the best of the emerging scenerios; the worst being assignment "broadcasts".

Kathleen - pls refer back to post 52 - especially the Red Highlights and bottom clause "v" then scroll up to 44.

 

[Kathleen O. Farrelly]

fees

Mike,

I am not understanding your reference. When a client imposes a prescribed fee based soley upon their criteria is there a legal remedy? Sorry but much of this is new to me.

 

[Mike Kennedy]

See your PM Kathleen.

 

[The Warrior Monk]

Mike,

I am not understanding your reference. When a client imposes a prescribed fee based soley upon their criteria is there a legal remedy? Sorry but much of this is new to me.

No.

You are an independent contractor and can simply say no to the assignment.

There are other examples in other fields. Take for example doctors. Some doctors have gotten sick and tired of fees paid by insurance companies, Medicaid, etc. As a result, they modified their practice so that the patient pays up front...no insurance, no government intervention, and less of the massive amount of paperwork that needed to be filed.

 

[Kathleen O. Farrelly]

fees

David,

Yes, I absolutely agree. I am an independant contractor and in a free market should have the ability to set my own fees and can simply say no to any assignment for reasons including fee or otherwise.

However, your comparison to other fields is not substantive particularly when considering doctors. Patients have the ability to seek quality medical care and the option of seeking doctors who participate in their insurance program, or they may opt for out-of-network coverage, or they may self pay if affordable.

Borrowers, unlike patients, have no option other than to accept the engagement of a valuation professional based upon a lender/AMC criteria, whatever that may be.

 

[The Warrior Monk]

Borrowers, unlike patients, have no option other than to accept the engagement of a valuation professional based upon a lender/AMC criteria, whatever that may be.

Is this a guild for appraisers or borrowers?

 

[Kathleen O. Farrelly]

What I am saying is that your analogy to doctors and patients does not apply. Doctors set their fees and have the ability to accept insurance payments and bill the patient for the balance.

While appraisers may have established fees that can support their business model, recently it is the lender/client who dictates the fee, not the appraiser.

 

[The Warrior Monk]

While appraisers may have established fees that can support their business model, recently it is the lender/client who dictates the fee, not the appraiser.

Simply not true.

If you have 100 appraisers agreeing to do an assignment for $200, and you charge $300, you're not getting the assignment. And, chances are, if any of those 100 appraisers find out that others are charging the same rate, they'll lower theirs even further.

If the AMC wanted to pay $200, and no appraiser was willing to do that assignment for less than $250, does they AMC go back to the lender and say they can't get the assignment done, or do they pay the $250???

Some of us have seen the reverse situation, where lenders couldn't find enough appraisers to meet the demand, and were offering to pay more for assignments. FWIW, those days are likely to come back, during the next real estate boom (which is a long ways away).

Many appraisers are simply tossing market forces to the wind, and think that they can be regulated away...it's simply not going to happen. Independent contractors doing work for lenders are completely responsible for what the charge...it's not the clients fault when they offer a "low" fee and appraisers accept it in droves.

A guild will not solve the problem of appraisers be bad businesspersons.