Working Directly For A Bank

[PhiloFarnsworth]

After years of running my appraisal business almost exclusively off of AMC's, with all the frustrations that entails, I have finally managed to attract the interest of a couple local banks. Before I enter into an agreement with one, I was wondering if I could get some input from appraisers who have more experience working directly with lenders.
First, is there anything that is expected of me that is not expected with an AMC? Does a bank have any specific expectations that would differ from a typical AMC's in scope and reporting?
While I assume most of this will be spelled out in any letter of engagement, I must admit that, since the laws changed regarding lending several years ago, I am not really sure what sort of assignments a bank would ask for outside those that are required to go through an AMC.
Maybe I am worried about nothing, but, as this is new territory and I feel that there are things I don't even know if I know, I was hoping someone with prior experience might have a pointer or two.

 

[Mike Kennedy]

Those valid questions should be addressed to your Hiring Manager......Good Luck with It.

 

[Mark K]

The small amount of mortgage work that I do is directly for local banks; I've never worked for an AMC and likely never will.

Nothing special about it. Some local banks keep most of their loans in-house (portfolio) and therefore they're not concerned about Fannie regs. Sometimes they keep them in-house but want them available to sell so they want Fannie regs followed. I do a lot of appraisals for new construction loans that are temporary financing during building and the borrower then gets a permanent loan upon completion. I also do some ag ground appraisals for the banks and appraise building lots in the subdivisions.

Be certain of what they want in an agreed upon scope of work, i.e., Fannie or in-house, which form or format, etc. Last order I received was for refi for three duplexes. Instead of three separate form reports I suggested doing them all in one narrative report. They were fine with it since all three were going under one mortgage. The order before that was for three building lots and two spec homes. The three lots went in one report, the two spec homes in another. The bank was putting a blanket mortgage on all five properties. If the lender is keeping the loan in-house they have a lot of latitude in report options.

Good luck, it could turn out to be a good source of business. Sometimes you'll get some bizarre requests but that's what makes things interesting. And bizarre usually pays well.

 

[bnmappraisal]

Philo, first off, congrats! I think you'll enjoy the bank work a lot more than the a m c world.

Question? Are you going to be a staff appraiser/employee for the bank? Or are you independent fee able and going to be doing bank work?

Independent should give you more range as far as negotiating fees, etc. Staff, not so much.

 

[ockyappraiser]

I have two banks I work with. Both require me to "bid" on orders as they send the order to all appraisers on their panel. One pays in 30 days, the other not until the loan is funded.

I have two AMC's I work with. The orders come to me full fee, as I have all ready set it up that way. One pays in 3 days, the other in 10. . .both direct deposit.

I will take the AMC's

 

[Tim The Enchanter]

Read their engagement letter before starting the job, and again before you send the report.
Make sure you cover what they want as far as scope of work and what the report should contain.
Good luck with them.

 

[J Grant]

When you did appraisals for the AMC's, the client was a bank, so you likely were doing what the norm is , esp as most banks sell to same secondary market at end of day, Fannie, FHA etc. If private they may have similar guidelines, in case they want to sell loan at future date but find out.

I would have an open discussion with your manager, is there anything specific they require or prefer to see in a report as you would want to meet or exceed their expectations. Get an over view of what type of assignments, ask in a friendly way, they usually like to talk.

Best of luck!

 

[Vermonter]

I have two banks I work with. Both require me to "bid" on orders as they send the order to all appraisers on their panel. One pays in 30 days, the other not until the loan is funded.

I have two AMC's I work with. The orders come to me full fee, as I have all ready set it up that way. One pays in 3 days, the other in 10. . .both direct deposit.

I will take the AMC's

Sorry to hear that.

Working for banks is not much different than working for AMCs. There are good and bad (although rarely ugly). Some pay quick, some don't. Some are high maintenance, some aren't.
With direct order lenders or AMCs, the key is weeding out the bad to find the good.

The main difference between the two (in my experience) is the ability to establish a long term working relationship with the banks. You will probably never do that with an AMC. I've been working with the same ordering team and underwriters at the local banks for over a decade. Thru HVCC, thru mergers. I know what to expect from them and vice versa, which provides more stability in my business (and probably theirs to some degree).

When I did work for AMCs, there was a lot more volatility. One month it was more orders than I could handle, the next month crickets. Start to think you're making a connection with one person and then they're gone. Start to think you have a steady, solid client and then no orders for months.

YMMV.

Good luck!

 

[PhiloFarnsworth]

Philo, first off, congrats! I think you'll enjoy the bank work a lot more than the a m c world.

Question? Are you going to be a staff appraiser/employee for the bank? Or are you independent fee able and going to be doing bank work?

Independent should give you more range as far as negotiating fees, etc. Staff, not so much.

No, I am going to remain free as a bird. According to the bank rep, we work in rotation within a given county.

 

[PhiloFarnsworth]

Given what you say, I can see why you prefer the AMC's. But this particular bank agreed to my top dollar fee as a basic fee. So, We'll see. BTW

the other not until the loan is funded.

Isn't this a blatant USPAP violation? Or is this something that is just sort of "understood"?