"While there is no clear
accounting of how much debt Evaluation Solutions left behind, the current
evidence suggests that the unpaid invoices to real estate professionals total
in the millions."
Fast becoming one the profession’s most pressing problems, another AMCs
this time leaving individual appraisers owed thousands or tens of thousands of dollars.
How the lender and regulators respond may create important precedence for the
AMC Fails: Appraisers Stiffed Again by Isaac Peck
Evaluation Services/ES Appraisal Services is the
latest national appraisal management company (AMC) to declare bankruptcy and
leave hundreds of real estate appraisers and agents/brokers with unpaid
invoices.While there is no clear
accounting of how much debt Evaluation Solutions left behind, the current
evidence suggests that the unpaid invoices to real estate professionals total in
Those appraisers and agents/brokers who have been affected have been actively
sharing their stories online and putting pressure on the lender who hired
Evaluation Solutions, JP-Morgan Chase, to cover the AMC’s bad debts. Last year
under similar circumstances, appraisers cited numerous regulations, including
the statutes of FIRREA and the OCC (Collecting
AMC Debt from Lender),
arguing that when an AMC fails to pay the appraiser, the lender becomes
responsible, since the AMC is an “agent” of the lender (AMC
Bad Debt – Lenders Responsible?).
So far, Chase, the lender who hired Evaluation Solutions, is refusing to take
Appraisers Left Unpaid Nicholas Conteduca, an appraiser from Chicago, says he is owed well over $30,000
for appraisals he did for Evaluation Solutions.After hearing they were ceasing operations, he created a website,
allows appraisers and agents/brokers to share information, collaborate, and post
how much they are owed. The website is littered with comments from appraisers
and agents/brokers who are owed tens of thousands of dollars.At the time of this writing, the running total reported to the website is
Conteduca’s story has similarities with others. He says he worked for Evaluation
Solutions for two years and that slow payment was the norm.“It
would typically take 60 days or more to receive payment, and sometimes up to
four or five months. But I always understood that they took a long time to pay,”
says Conteduca. The fact that Evaluation Solutions consistently let invoices
build up into the thousands, and tens of thousands of dollars before paying,
made it less alarming when the total invoice amount would begin to build back
Like others in his situation, one of the reasons Conteduca kept working for
Evaluation Solutions was because they paid him higher fees than any other AMC.“On orders where the standard fee was $250-$300, they would pay $600 or
$700 an appraisal,” Conteduca says.
The staff at Evaluation Solutions often lied about when payment was going out
too, according to Conteduca. “There were times when they said they sent out a
check but they didn’t.The only way to
get paid was to constantly email and call them,” says Conteduca.
Conteduca says he has been in contact with Chase, who had told him they would
contact him on January 10 with a response, but so far he has heard nothing from
William Furney, an appraiser from Rhode Island, says his firm is owed $73,960
for work done over six months. “Five of my appraisers and myself were doing work
for Evaluation Solutions. I’ve already paid out around $40,000 to my appraisers,
so now I’m out the money that they owe me,” says Furney.
Furney, who had been working for Evaluation Solutions for three years, confirms
Conteduca’s experience that Evaluation Solutions was consistently slow to pay,
but that they also paid a little bit more than other AMCs.“They had owed me money before this. They paid me here and there and
sometimes a few months would go by,” says Furney.
Furney says he only did a few appraisals for them in the beginning because of
their slow payment, but then they would pay.“One time it went for five months, so I started putting a lot of pressure
on them and they sent me a large sum,” Furney says.Furney ended up doing so much work for them that he made a few friends at
their office. “The girls from the office would text me, asking me if I needed
work,” says Furney.
“This time around, the amount they owed me was getting larger and larger and I
started freaking out. They would tell me, ‘I’m really sorry, I’m going to Fed-Ex
you a check so you’ll have it by this day,' but the check would never
come,” says Furney.
On the day Evaluation Solutions shutdown, Furney was still trying to get paid.
“I started getting really fed up so I called one of the girls there who I knew.She said that she was putting pressure on the head of accounting, and
that my check should’ve gone out already.She told me that the head accountant was in a meeting and that she’d call me
right back.I got a text message an hour
later and she said ‘I just lost my job, they just kicked everybody out,’” says
After hearing that Evaluation Solutions was going under, he called the
WAMU-Chase Department in Florida. “The manager there told me he was being
bombarded with calls from appraisers, then gave me the cell-phone number of the
regional manager of the mortgage department at Chase,” says Furney. “When I
originally called the regional manager, he told me to send him a list of my
invoices and that he would get to the bottom of it, but he never called me back.When I finally got him back on the phone, he told me he ‘got wind’ that
Chase isn’t really responsible for this and that he couldn’t help me,” says
“This regional manager had the manager at WAMU-Chase in Florida call me back and
he immediately started reading a script.It was pretty clear that Chase had their legal department send around a script
to read to all appraisers calling in about this issue. I managed to get him off
the script and he ended up telling me he was the one who hired Evaluation
Solutions and he offered to refer me to his other clients!I said no thanks, that’s my kid’s college fund!” says Furney.
Agents/Brokers Unpaid Appraisers are not the only ones who were left with unpaid invoices when
Evaluation Solutions shut their doors.Shelley Smith (not her real name) is a real estate agent/broker who says that
she is owed over $46,000 by Evaluation Solutions for over 900 BPOs that she
completed over a six-month period.“I
worked for them for three years and they were always slow to pay. They typically
took 90 days to pay me,” Smith says.
Smith experienced the same issues as Conteduca and
Furney with regards to being lied to about when payment was being mailed out.
“This latest time, they actually sent me an email in October of last year that
my payment had gone out, so I kept working for them, but the check never came,”
Upon hearing the news that Evaluation Solutions was filing for bankruptcy, Smith
created a Facebook profile, Evalonline
Complaint, as a gathering place for appraisers and agents/brokers to come
together and discuss their options.At
the time of this writing, the profile had 69 friends.
Since Evaluation Solutions went under, Smith has been in direct contact with
Chase, the lender and “client” who ordered all of the BPOs through Evaluation
Solutions. Chase initially instructed her to fax her invoices over to their
research team, but less than a week later Chase sent notice to Smith saying that
since they are not the direct vendor they declined to pay the invoices or to
further research the issue.
Through her Facebook profile, Evalonline
Complaint, Smith says she is gathering support for a class action lawsuit
against Chase bank, if it comes to that.According to Smith, a class-action lawsuit against Chase will be used as a last
resort if filing complaints with the OCC and CFPB fail.
To Smith, this is also a case of fraud on Evaluation Solutions’ part and she has
also filed a Fraud Tip Form with the
FBI. “It is fraudulent behavior for them to accept money for work from Chase,
and then not pay us for doing that work. But also, the repeated instances of
emailing us that payment had been posted, when no payment was coming, was
intentionally fraudulent. I believe they intentionally lied and engaged in
fraudulent and criminal behavior,” says Smith.
Moving Forward It has been less than a month since Evaluation Solutions closed its doors, so it
remains to be seen how Chase will handle this issue. From what appraisers and
agents/brokers on the ground are saying, it is likely that within the coming
weeks numerous complaints will be filed against JP Morgan Chase with the OCC,
CFPB, and with the Florida State Banking Commission.If Chase continues to deny responsibility for Evaluation Solutions’ bad
debts, the response by regulators might set a new precedent for the industry-
whether it holds Chase responsible or not.
The bankruptcy of Evaluation Solutions is a glaring reminder that the proper
regulation and vetting of AMCs continues to remain a problem for the industry.Working RE has covered this issue in depth and appraisers and
agents/brokers are encouraged to read the stories of others who have been
successful in getting lenders to pay for the bad debts of the AMCs they hired:
Working RE also has an
AMC Rater blog,
where appraisers can share their experiences with AMCs and pick up on AMCs who
are having payment problems.On the AMC
Rater blog, appraisers were warning that Evaluation Solutions was slow/no pay as
early as April 2012.
Author Isaac Peck is the Associate Editor of Working RE Magazine and Marketing
Coordinator at OREP.org, a
leading provider of E&O Insurance for appraisers, inspectors, and other real
estate professionals in 49 states. He received his Bachelors in Business
Management at San Diego State University. He can be contacted at Isaac@orep.org
What steps do you take to avoid AMC non-payment issues?
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