The Appraiser Shortage Myth Part 43

[J Grant]

Well, my opinion is based on observation of actual data. We work with a LOT of different lenders, and they don't all have the same arrangement. Although most lenders resist it due to the disclosure issues noted earlier, I do have clients that operate with my company under a cost plus model, and I have seen first hand the effect (lack of effect, to be more accurate) on appraiser behavior. And why should it affect appraiser behavior? If an AMC (or anyone, for that matter) asks you what your fee is, then you should quote YOUR fee, regardless of any fee arrangement the AMC has with a lender.

Thank you for your fake concern that appraiser behavior wouldn't change -we'll take our chances. Switch your business model to 100% cost plus, we can deal with our own behavior.

How can you measure appraiser behavior when it is a limited segment of lenders using cost plus within the SL environment, which outside of that segment of cost plus orders is about selection involving competitive low fee as a component?

In any case, our behavior is our problem, stop waving it around like it's a noble reason to leave things as they are. In addition, appraiser behavior to compete for orders by low fees is eliminated when cost plus is in place, since typically a uniform fee is paid to appraisers in a region when that happens.

 

[DWiley]

...but the final rule, excludes AMC paid rates as C and R.

That particular provision applies to surveys. It does not apply to studies of actual fees paid. Can't just read the parts you like.

It is funny how people want to argue both ways on this. On the one hand they say that AMCs have too big a share of the market, yet they also want to argue that even though over half the business goes through AMCs, those fees should not be used to determine market rates (C&R). If somewhere between 50% and 80% of transaction are conducted a certain way, then what should establish the market rates for those transactions? The 50% to 80% or the remainder? I know how you will answer, but what would your answer be if the question was about real estate prices rather than appraiser fees?

 

[hastalavista]

Reminder: DF regulation, is for AMC's to pay C and R fees,not fees driven by supply and demand . You can argue that market forces ( supply and demand ) will shape C and R fees, but the final rule, excludes AMC paid rates as C and R.

(my bold)

I will attempt to ask you a serious question:
There are two presumptions in the IFR:
The first allows AMC paid rates to be part of the calculation.
The second allows 3rd party studies that exclude AMC rates (and includes VA rates).



How is your bolded part in the quote consistent with what the actual rule states?
Or, is it your argument that AMCs violate the second bullet point, so therefore whatever they pay does not meet the 1st presumption?

 

[J Grant]

It is funny how people want to argue both ways on this. On the one hand they say that AMCs have too big a share of the market, yet they also want to argue that even though over half the business goes through AMCs, those fees should not be used to determine market rates (C&R). If somewhere between 50% and 80% of transaction are conducted a certain way, then what should establish the market rates for those transactions? The 50% to 80% or the remainder? I know how you will answer, but what would your answer be if the question was about real estate prices rather than appraiser fees? [/QUOTE]

It is the LAW that states it, what you rephrase as market rates ( a spin term for C and R, are you that afraid to utter the word C and R?) The final rule of DF regulation says exclude AMC payments as a measure of C and R, not funny silly appraisers here on the board. .

 

[DWiley]

You know what a legit lender does regarding C and R? Even If MY fee is lower than C and R, ( they pay me above "my" fee, if the C and R rate is higher. I know because this very thing happened to me with a well respected lender. THAT is what compliance with C and R looks like.

I agree. That is why we do exactly the same thing

 

[DWiley]

...says exclude AMC payments as a measure of C and R, not funny silly us appraiser people.

Please read the actual wording that Denis posted. What you assert as being universal is not. It only applies to certain methodologies.

 

[J Grant]

(my bold)

I will attempt to ask you a serious question:
There are two presumptions in the IFR:
The first allows AMC paid rates to be part of the calculation.
The second allows 3rd party studies that exclude AMC rates (and includes VA rates).

View attachment 32912

How is your bolded part in the quote consistent with what the actual rule states?
Or, is it your argument that AMCs violate the second bullet point, so therefore whatever they pay does not meet the 1st presumption?

Did you paste that from a document before the final rule came out? Please paste what the final rule states.

 

[DWiley]

Did you paste that from a document before the final rule came out? Please paste what the final rule states.

It does not state what you think/want.

 

[hastalavista]

Did you paste that from a document before the final rule came out? Please paste what the final rule states.

(my bold)

My pleasure.

I'll repost what I just posted; you can look it up.
Again, can you tell me where you read AMC fees cannot be used under presumption #1?

 

[timd354]

I call out once more about quoting YOUR fee, since it in effect gets no work, or scraps, from SL unless it is low . I know first hand, your company solicited me to join, I did, quoted MY fee, which was very reasonable but I know above the basement level where I would get orders, and sure enough, in 2 years active, I got NOTHING, no orders , nothing at that fee. I suppose if MY fee was 50% lower I 'd be swamped. .

Your fee apparently is not competitive with your peers in your market, but yet you still want someone to use you and pay you more than they need to pay to obtain an acceptable appraisal because...exactly why should that happen?

I guess that you think that you are entitled to your fee even if that fee is higher than what other appraisers in your market charge or you think that you are a better appraiser than practically everyone else in your market, but that is what most appraisers think and is just wishful thinking in most cases.

You have been out-competed in the market place for SL's business and now you want the government to come in and fix it for you by forcing users of appraisal services to pay above market fees or mandate some sort of mandatory rotation so you can get your piece of the pie without having to out-compete your peers.