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2015 Expert’s Guide to Defensible Workfile
“Bulletproof” your Workfile, protect your license and your livelihood with expert help. Quick tips from an expert on how to produce highly defensible reports that keep you safe and raise the quality of your product. Click now
2015 AMC Guide
UPDATED 2015 AMC Guide. Increase orders so you can turn down low-fee AMC work, negotiate fees from a position of strength and confidence and refuse to work for the AMCs that undervalue you. Start 2015 off with a new book of clients! Work with the best and fire the rest. Click now.
> FREE Webinar in April (Reserve space now!)
Background Screening – Understanding the Problem, Finding a Solution
Editor’s Note: This is one appraiser’s response to a recent WRE story: Appraisers, AMCs and Building Bridges. He writes under an alias due to fear of retaliation from his AMC clients – and he has something to say about that too.
AMCs – A Bridge Too Far?
By John Doe
Last night I lost a second appraisal from an AMC. All I was asking for was an additional $25 fee, which is $25 less than the customary and reasonable fee for this area. I lost two assignments yesterday this way. So today I’m not working.
I am a Certified Residential Appraiser. I attended the Appraisal Summit last year and saw the panel that you (David Brauner) moderated. I also liked your article Appraisers, AMCs & Building Bridges in Working RE (Visit WorkingRE.com; click Library, WRE Online). I am interested in your reporting on the auditing process of AMCs to determine who gets the appraisal, and their assertions that it is based upon competency first. In my experience, this is the exception, not the rule. I have found the opposite to be the case.
The AMCs are in a straight commodity arbitrage business. The only way they make money is by increasing their margins. Get more for the appraisal and then pay as little as possible. Despite what these AMC people say, to portray it in any other way is to miss the point. As an appraiser, I am on the opposite side of the table from the AMCs I work with. They want me to work for as little as possible and I want to charge as much as possible. It is an adversarial relationship, though it can be mutually beneficial.
My fees are below or equal that of most of my peers with whom I spend a lot of time. For example, today I got a request of $240 for a 1073 (Condo) form. They typically pay me $325 but due to the slowdown in lender work, they know they can pay less. I wrote them back and quoted $300. They wrote back and said, “Thanks but no thanks.” The reason I lose most of the AMC work offered to me is exclusively due to price. I have a 100 percent clean history and do clean and error-free work. The reason I lost the contract was my fee. Not regional competency. My only choice as an appraiser, as someone who has performed professionally in the field for 22 years (never sued, never sanctioned or scolded) is to accept this unequal power structure or leave the business.
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In the go-go days that led up to the housing collapse, the financial institutions set up a structure that ensured appreciation in the housing market. Loan officers would give more/all work to appraisers who “hit” an inflated value. The same system is at play today with regard to appraisers and their fees. The system is set up to reward appraisers who perform at the lowest price. The appraiser who can turn around assignments the fastest and the cheapest get the work. But the appraisal fee doesn’t go down for the customer, it goes down for the appraiser.
What I struggle with is that when all lender work was detoured through AMCs by the government, it took away my ability to negotiate with equal power. Since we are compelled to be in this relationship with AMCs, I don’t see why it would be unethical to set standard brokerage fees for AMCs. Create a dynamic where appraisers and AMCs have equal power.
Finally, appraisers are afraid to speak freely and publicly. My name is not attached here because one of the AMCs that I deal with made me sign an agreement that states that I will not say disparaging things about them, otherwise they can sue me. These institutions aren’t afraid of appraisers speaking lies about them; they are afraid of appraisers speaking the truth about them and are seeking to suppress open and honest discourse.
April Webinar Schedule
> How to Determine Land Value/Building a Better Cost Approach
> Background Screening– Understanding the Problem, Finding a Solution – Presented by Comergence (Free)
How to Determine Land Value/Building a Better Cost Approach
Part 1: How to Determine Land Value (presented live April 7)
Now Available On-Demand: The market value of all real estate is based on land and its desirability. Land value is the basis for determining numerous appraisal adjustments and may be the single most important component of any appraisal- especially the good ones. Do you know how to determine land value even when there are no land sales? In this webinar, Richard Hagar, SRA shows you seven easy methods for determining land value. These methodologies work on SFR, multi-family, farmland, and commercial properties located in dense downtown cores or sparsely populated rural areas. Sign Up Now!
Part 2: Building a Better Cost Approach
Live: April 14, 10:00 – 11:30 a.m. PST
How often do you use the cost approach? In this webinar, Hagar shows appraisers why the cost approach should be included and how to correctly use this method to strengthen their appraisals. Sign Up Now!
Note: Live webinars are recorded for on-demand viewing in case of scheduling conflicts.
Free Webinar April 23 – Presented by Comergence
Background Checks—Understanding the Problem, Finding a Solution
Are you tired of paying for background checks? Do you ever wonder WHY AMCs want background checks even though your state board already cleared you? In this webinar, Comergence Executive Corey Prezenkop explains the laws involved, where the requests are coming from, and how to simplify the process, save time and money, and avoid paying for background checks for multiple clients no matter how many AMCs that you work with. Sign Up Now!