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Taking On A Trainee. 10 - 15 Per Hour

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Scott R.

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Member
Joined
May 6, 2006
Professional Status
Certified Residential Appraiser
State
California
About 3 months ago I took on my first trainee. First and probably last. After about 2 months they went to work full time with another appraiser long before I was ever able to recoup any of the money/time spent helping to train that person. After talking with several other appraisers.....one of them said they would take on a trainee.......and charge the trainee $10 to $15 per hour depending on their experience (are they a REALTOR or prior lender or banker, etc). Anyone ever heard of charging a trainee....to actually train them? Just thinking out loud here.
 

Mike Kennedy

Elite Member
Joined
Sep 28, 2003
Professional Status
Certified Residential Appraiser
State
New York
IMO, the $10 - 15 is already deducted from the appraiser's cut of whatever the full fee is - the house keeps it - consider it a training fee.
 

Scott R.

Thread Starter
Member
Joined
May 6, 2006
Professional Status
Certified Residential Appraiser
State
California
My deal with the trainee was the same deal I had years ago when I was a trainee. That is, when I was able to do a somewhat reasonable appraisal report from start to finish (includes the inspection, photographs, data searching and writing the report) where my trainer only had to spend 20 to 45 minutes reviewing and fixing it before they signed it, I received a percentage starting at 35% and ending around 60% of what the fee we were receiving. Up to that point, I was paid nothing, no hourly fee, no percentage. As a trainee I can see where I cost my trainer money....to train me. My own post makes me laugh.....but the thought of charging a trainee to train them might have merit. Like I said....just thinking out loud.
 

Mike Kennedy

Elite Member
Joined
Sep 28, 2003
Professional Status
Certified Residential Appraiser
State
New York
My deal with the trainee was the same deal I had years ago when I was a trainee. That is, when I was able to do a somewhat reasonable appraisal report from start to finish (includes the inspection, photographs, data searching and writing the report) where my trainer only had to spend 20 to 45 minutes reviewing and fixing it before they signed it, I received a percentage starting at 35% and ending around 60% of what the fee we were receiving. Up to that point, I was paid nothing, no hourly fee, no percentage. As a trainee I can see where I cost my trainer money....to train me. My own post makes me laugh.....but the thought of charging a trainee to train them might have merit. Like I said....just thinking out loud.
Rottsa Ruck W That
 

Michael S

Senior Member
Joined
Mar 18, 2009
Professional Status
Certified General Appraiser
State
New Mexico
Your state rules and regulations regarding appraisers probably require you to provide training and supervision of a trainee. If you are truly supervising them and training them then the IRS will likely view them as an employee. Trainee and 1099 independent contractor don’t really go together. Either you’re lying to your state board or you’re lying to the IRS. The bottom line is that you’ll need to pay a trainee as an employee at least equivalent to minimum wage (including FICA, etc.) or you could be looking at some unwanted attention from the IRS for wage theft.

Obviously for a lot of solo residential practitioners this doesn’t make a lot of sense, thus the shortage of supervisors for new appraisers looking to enter the market. On the commercial side, it can make more sense as paying a trainee $10-15 an hour for very basic work (putting pictures in a report, copying or writing simple area/neighborhood descriptions, verifying zoning, land size, etc.) is cost effective if it frees you up to do more work grossing $50 an hour or more. I had a salary of $30,000 as a commercial trainee and typically worked about 50 hours a week. It was enough to survive on but I felt like an indentured servant for those three years. Once I got certified and was on a split my income pretty much doubled within the next couple years.
 

Scott R.

Thread Starter
Member
Joined
May 6, 2006
Professional Status
Certified Residential Appraiser
State
California
Michael S.........before I took on the trainee I checked with the Office of Real Estate Appraisers (OREA) in California and my CPA. Both said the trainee was not an employee because I was not paying him/her. The trainee was an unpaid apprentice. In addition....the OREA would not comment to me if a trainee is an independent contractor (like a real estate agent) or an employee. So.....your points are well taken.

My first (2) years of work (training) was with a certified general appraiser in California........and yes I was paid minimum wage. I used those hours for my original licensed status (AL). After that I trained with a certified residential appraiser and got the rest of my hours.

My thought is I'll never take on a trainee again. It makes zero economic sense. I just thought it was a funny that one certain appraiser said they would, but would charge the trainee an hourly fee.
 

bnmappraisal

Elite Member
Gold Supporting Member
Joined
Nov 9, 2011
Professional Status
Certified Residential Appraiser
State
Florida
I just thought it was a funny that one certain appraiser said they would, but would charge the trainee an hourly fee.
I, too, think it's funny (weird) to charge them (a trainee) an hourly rate ($10/hr for 2,000 hrs = $20,000) for an appraiser to train them.

To me, in my personal opinion, that's not the reason one takes on a trainee. I've considered taking on a trainee before and even have had a few sit downs with potential ones over the past few years. The thought for any of them to pay ME to train them, never crossed my mind.
 

USPAP Compliant

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
North Carolina
I, too, think it's funny (weird) to charge them (a trainee) an hourly rate ($10/hr for 2,000 hrs = $20,000) for an appraiser to train them.

To me, in my personal opinion, that's not the reason one takes on a trainee. I've considered taking on a trainee before and even have had a few sit downs with potential ones over the past few years. The thought for any of them to pay ME to train them, never crossed my mind.
In NC a trainee can not pay a supervisor. Obvious conflict of interest.
 

hastalavista

Elite Member
Joined
May 16, 2005
Professional Status
Certified General Appraiser
State
California
In NC a trainee can not pay a supervisor. Obvious conflict of interest.
And, it is implicit in the Supervisory Certification on the GSE forms that the appraiser is an employee or subcontractor of the supervisor appraiser or the appraisal firm for which they work.

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I believe I recall (but haven't searched to confirm) that somewhere in Fannie's communication they explicitly stated the supervisor cannot be an employee or subcontractor of the appraiser-trainee.

I suppose a work-around to this would be not to have the trainee sign any Fannie-bound appraisal reports. Which would mean the supervisor would have to sign on the left as the "appraiser" and complete the inspection of the subject as well as the comparables.
 
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