Ready to Start My Own Appraisal Business

[BigD LLC]

There are plenty of AMCs, and as, your name gets out there, banks, that will be willing to send you work at a busy time like this. It may mean lower fees at the start, of course, which is part of the process - find clients willing to put you onto platforms like Mercury, cold-call AMCs and ask to speak with their vendor managers - be proactive. The squeaky wheel gets the grease.

THE key thing is developing an efficient SYSTEM. That takes time and the right pieces. My wife took over the running of all of my non-appraising work shortly after we met. It helped that she had a background running businesses. So she now does all of the secretarial, admin, scheduling and accounting/tax prep work. I've also trained her to do initial data pulls on orders that she then writes up for me on the front of each order form. I literally can spend 90% of my time on just appraising.

Another family member (now my trainee) takes turns with my wife driving me to and from appointments. Can you imagine how much more efficient you could be if you could spend that car time on your laptop typing? I can answer that for you - it can make the difference of an additional appraisal or an appraisal and a half a day in a busy bedroom community cookie-cutter area like DFW.

Just some ideas for you to keep in the back of your mind as you go forward. You are also probably way ahead of old timers like me in terms of using new technology software online platforms like Sparks that might also help you with efficiency. Good luck!

Thank you for your reply and advice. Really appreciate it...so glad I found this forum, it's an invaluable resource for a very career as quirky as appraising can be.

 

[BigD LLC]

I'm hoping to get certified later this year and am planning on starting a shop myself (in Fort Worth). If you want to get in touch later this year maybe we can share tips and ideas to help each other out.

For sure...I'll reach out directly and we can swap battle stories/advice lol.

 

[Russ Kitzberger]

I suggest working with a group for a few more years. If you want to go it solo, consider creating a LLC and moonlighting for other clients. You may not notice it in residential, however, in commercial large firms compete for talent and hire away appraisers from each other. I think that might start happening in residential as well.

The key to a successful residential lending business is know when to take projects and when not to and how to find customers and manage your time. Right now you have someone doing that analysis and they are ensuring projects fit your wheelhouse. The appraisal market you are seeing today, is NOT normal. As a residential lending appraiser; when things are normal, you have to decide on if you want the client to look at other appraisers if you turn down work.

You also need to learn to find work and always be adding clients, clients will come and go, however, you will need to keep making a living.

BAD IDEA; Hiring members of your household full time:

As a risk analysis, it is a terrible idea to hire anyone in your immediate household full-time. Both your careers are tied into the same very niche industry. If you are a solo practitioner, you are paying for both your healthcare, retirements and social security. If your spouse was at a company, the company would be adding an on and off-tax return income of $8,000-$20,000+ to your household through providing non-taxed and tax-deferred benefits to your spouse/partner and you by the domestic partnership. Additionally, experience as assistant to the president of a one-person appraisal shop is significantly less salary and has much less career potential than an assistant to an executive of any corporation. If your partner goes through a career change and can add value, great, but full time, it is a bad idea. In particular because all professions can be done remotely, they can still work from your home while receiving a salary and benefits from a corporation. If you have an injury, or any professional licensing problem, you both will be out of work. If you want to get them licensed, consider them helping you part-time. For full-time help: Hire anyone other than people in your household.

If you seek to have a business setup and do not have the skills, you can hire consultants to guide you. The cost is only $5,000-20,000 depending on how much help you need. If you like the practice of another appraiser, just hire them to get you up and running.

 

[Cob]

Understood...I'm guessing that time period is about 3 years? Are there better options out there for a young & ambitious certified appraiser working in thriving DFW market, other than a nationwide AMC?

I believe the rule in Texas is you can't have a trainee or trainees for 3 years, not that you can't work on your own or have your own company.

 

[Tim Hicks (Texas)]

Many lenders want you to have 5 years experience to be put on their approved appraiser's list.

 

[BigD LLC]

Many lenders want you to have 5 years experience to be put on their approved appraiser's list.

Thanks for your feedback Tim, and that's the consensus that I'm getting...at least 3 years minimum. Also, I have not connected with a certified general that I could work with on more complex assignments. I have decided to wait and continue to learn and gain experience. My end game is definitely commercial and I think I just need to be patient. The AMC I work for actually treats their staff appraisers pretty well compared to other other places I've heard . My ambition got the better of me again .

 

[BigD LLC]

I suggest working with a group for a few more years. If you want to go it solo, consider creating a LLC and moonlighting for other clients. You may not notice it in residential, however, in commercial large firms compete for talent and hire away appraisers from each other. I think that might start happening in residential as well.

The key to a successful residential lending business is know when to take projects and when not to and how to find customers and manage your time. Right now you have someone doing that analysis and they are ensuring projects fit your wheelhouse. The appraisal market you are seeing today, is NOT normal. As a residential lending appraiser; when things are normal, you have to decide on if you want the client to look at other appraisers if you turn down work.

You also need to learn to find work and always be adding clients, clients will come and go, however, you will need to keep making a living.

BAD IDEA; Hiring members of your household full time:

As a risk analysis, it is a terrible idea to hire anyone in your immediate household full-time. Both your careers are tied into the same very niche industry. If you are a solo practitioner, you are paying for both your healthcare, retirements and social security. If your spouse was at a company, the company would be adding an on and off-tax return income of $8,000-$20,000+ to your household through providing non-taxed and tax-deferred benefits to your spouse/partner and you by the domestic partnership. Additionally, experience as assistant to the president of a one-person appraisal shop is significantly less salary and has much less career potential than an assistant to an executive of any corporation. If your partner goes through a career change and can add value, great, but full time, it is a bad idea. In particular because all professions can be done remotely, they can still work from your home while receiving a salary and benefits from a corporation. If you have an injury, or any professional licensing problem, you both will be out of work. If you want to get them licensed, consider them helping you part-time. For full-time help: Hire anyone other than people in your household.

If you seek to have a business setup and do not have the skills, you can hire consultants to guide you. The cost is only $5,000-20,000 depending on how much help you need. If you like the practice of another appraiser, just hire them to get you up and running.

A lot of really good information and advice Russ. I really appreciate it.

 

[Terrel L. Shields]

Avoiding secondary market via AMC is a good choice - so concentrate on the local community banks .... shoe leather time. They are better clients.

 

[Fernando]

It depends on your area. I am diversified having local banks, faraway banks, AMCs as my clients. One local bank just dropped dead and I haven't heard from them.
I do avoid attorneys and divorce appraisals. Not my kind of people. Too much negative energy.

 

[nachocheesefries]

I am a recently certified residential appraiser working in the DFW area for a large AMC. While obtaining my 1,500 experience hours as a trainee, I was also heavily involved in the accounting, administrative and marketing aspects of my supervisory appraiser's appraisal business. In the 6 months I've been certified, I have managed to make enough connections through either charm, dumb luck or nepotism, to be rostered up full time on my own. My question is, what's stopping me? I don't want 55%, I'd like 100%. I take pride in my work and education and have verified I'm pushing out upper tier reports. Is there really a rule in Texas I can't start my own gig for 3 years? I keep hearing that, but have yet to see anything in writing.

55%!???!?!?! If I were paying a fully certified appraiser, newly minted, only 55%, I would EXPECT they were going to leave me. NEXT!!!!

Go do your own thing. You got this. We sell a service that is mandated my law in most cases...its like the DMV...candy from a baby. Getting biz is so easy...Google it!