Are appraisal fees being paid to people with little or no education. Is part of your appraisal fee going to someone in another country that barly speaks a word of English? If you answered yes you may be right. In a time when loyalty doesn’t mean what it once did I find that there are still Appraisers that are loyal to their business. Appraisal management companies are not required to employ licensed appraisers and yet they are allowed to take part of the appraisal fee. I have also seen numerous so called “Appraiser Sites” where the primary purpose of the site is to create revenue from marketing to appraisers. In some instances these sites are not even owned by appraisers. For example, AppraiserUSA.com, AppraiserSites.com and AppraiserForums.com these sites market to appraisers and yet they are not owned by appraisers. The sites market appraiser products, and services, and promotes discussion about appraiser issues and are managed by people that are not active licensed appraisers. I submit that a person that is not active in the appraisal business is generally not informed enough to comment on current appraiser issues. I would also suggest that these kinds of people are in most cases motivated greatly by profit. While you are reading their literature and making decisions based on their advice it may be that you are being completely mislead? I would be very careful about taking appraisal advise from someone that is not an active appraiser. There are petition and form letters out on the internet that talk about wanting to reduce pressure on appraisers and yet they makes little strive to suggest any solution to this problem. They are basically a “poor me” letters. Perhaps, the reason there is no solution mentioned is because the writer or site owner doesn’t want to offend the lender or appraisal management companies. Are they affiliated with appraisal management companies? Don’t you think some of the companies they market to are appraisal management companies? Management companies are out on the Internet looking for appraisal clients? I wonder about this? I tried to reach a few of them them for comments but none of them have yet respond. 

I also noticed that one of the big appraisal software companies Alamode AKA Wintotal was sending letters to their customers asking them to write the lawmakers to protest the new appraisal legislature that is being considered for as law, the home valuation code of conduct or (HVCC). This legislature was designed to block bank owned appraisal management companies. Once again are the banks and appraisal management companies involved in this campaign? Why would independent fee appraisers want to protest a law that blocks bank owned appraisal management companies. Is there is some kind of deception going on here? Does Alamode appear to be in favor of allowing appraisal management companies continue to destroy the appraisal business? They make no mention of wanting to address the real problem, which is that the typical appraisal management company does not employ appraisers that are licensed and qualified to complete the appraisal orders that they contract to have completed. I tried to contact Alamode for a quote but they have declined  to respond. Is it because they are involved in a banking or appraisal management campaign to discourage this new law? The law will put many bank owned appraisal management companies out of business. They wouldn’t be able to take part of the appraisal fee all the while telling the consumer that they are only paying for an appraisal. These companies take part of the appraisal fee and are not typically qualified to accept the appraisal order in the location that the order is placed. Can you see why a new law is needed?

I would like to submit my thoughts on the proposed home valuation code of conduct. I think that the home valuation code of conduct does not go nearly far enough to protect consumers and appraisers. It should require that the person doing the appraisal work be licensed and qualified with the experience necessary to accept the order that is being completed and that anyone that contracts for appraisal work, such as appraisal management companies, should likewise be licensed and qualified to complete the very same appraisal work. This would completely solve the problems that arises from Appraisal Management Companies, because they typically do not employ appraisers that are qualified to complete the orders that they contract for. Management companies tried this approach in the land surveying business and they revised the laws to include that not only the person doing the survey but anyone that contracts for survey work be licensed and qualified to complete the very same work. The bank owned companies claim that all orders should go through appraisal management companies because they want to make more money. I submit that all companies that contract for appraisal work and take part of the appraisal fee should be licensed and qualified to complete the same order. After all, these fees are disclosed to the borrower as “appraisal fees”. If they are in fact appraisal fees then they should only be paid to licensed appraisers, otherwise the consumers are being deceived into thinking they are only paying for appraisal fees when in fact they are paying for management fees that many times go to people that are not licensed or qualified to appraiser their home. It’s insulting to see people that don’t even have a high school education getting part of my fee. There are people that don’t even have a full grasp of the English language and are living in other countries that are getting part of my fees. My question to you is do you not think there is something wrong with that? That is why I think that if a person or company wants part of the appraisal fee then they should be licensed and qualified to complete the very same appraisal. I have many years of experience in the Real Estate, Appraisal, and Lending Business and I hope that you might consider my thoughts on this subject. Instead of requiring that appraisals be managed by people that are many times not qualified to manage themselves, we should require that all companies or individuals that contract for appraisal work and take part of the appraisal fee be licensed and qualified to complete the same work.

By Robert B. Sheppard  

Read the Proposed Home Valuation Code of Conduct: www.oag.state.ny.us/press/2008/mar/Code%20Final%203-2.pdf               

Home Valuation Protection Program: www.fanniemae.com/media/pdf/030308_agreement.pdf

On April 10, the Senate overwhelmingly passed H.R. 3221, (Senate Passes Foreclosure Bill without Casey-Martinez Amendment) a bipartisan package of tax breaks and other steps designed to help businesses and homeowners weather the housing crisis. However, some fear that the plan, which combines large tax breaks for homebuilders and a $7,000 tax credit for people who buy foreclosed properties, as well as $4 billion in grants for communities to buy and fix up abandoned homes, favors businesses like homebuilders rather than helps borrowers at risk of losing their homes.  While originally proposed and passed by the House, changes to the bill in Senate mark-up leads to speculation that the bill will be significantly redrawn again in the House, such as rejecting $25 billion over three years in tax breaks for money-losing businesses such as homebuilders. A plan adopted April 8 by a key House panel dropped that idea as well as the tax credit for purchasers of foreclosed homes. The measure calls for a long-awaited modernization of the Federal Housing Administration that would enable more homeowners to refinance into loans backed by the Depression-era agency. The bill also offers $150 billion for pre-foreclosure counseling and stronger loan disclosure requirements as well as $10 billion in tax-free mortgage revenue bonds to help homeowners refinance subprime loans. A House bill takes a far different tack, steering tax breaks toward first-time homebuyers and investors in low-income rental housing. That measure is likely to be paired with a broader housing rescue package being drafted by House Financial Services Committee Chairman Rep. Barney Frank, D-Mass., which would have the FHA step in to back $300 billion in refinanced loans for 1 million or more homeowners who otherwise might face foreclosure. Under a similar plan by Sen. Christopher Dodd, D-Conn., the Senate Banking Committee chairman, the FHA would insure up to $400 billion in loans. (See related story.) The April 10 vote on H.R. 3221 came after an April 8 invocation of cloture, which meant limited debate and a speedy vote. Therefore, the bill did not include many proposed amendments, including one offered April 7 by Sens. Robert Casey, D-Penn., and Mel Martinez, R-Fla., that would specifically ban appraiser coercion, among other reforms to the real estate appraisal process.  The Appraisal Institute heralded the Casey-Martinez proposal in a release on April 7, stating, , “We support this amendment, applaud its bipartisan approach, and urge its immediate passage.” 

New Appraisers Forum, http://AppraiserX.com/ I want to make it known that their is a Appraisal Management Petition to protect Appraisers Rights. Do the AMCs have you in their clutches?

Read More: http://appraiserdock.com

Sign The Petition:

http://www.ipetitions.com/petition/AppraisalManagement/

Appraisers Fight Back! Take back your industry. AMCs want to run you. Let’s not allow individuals and companies that are not qualified to accept Appraisal Orders continue to contract for Appraisal Work. Appraisal Law (USPAP) states the minimum qualifications required to accept appraisal assignments. Are these companies educated and experienced enough to accept appraisal assignments or contract appraisal work. Are the Law Makers going to allow AMCs and Lenders take over your the Appraisal Business?    

Sign The Petition:

Appraisal Management Petition

http://www.ipetitions.com/petition/AppraisalManagement/

Rachel Dollar is an attorney and Certified Mortgage Banker who handles fraud recovery litigation for lenders and secondary market investors nationwide. She is a nationally recognized speaker on the topic of mortgage fraud. Ms. Dollar is benh1@asc.gov
cc: Other state or federal agencies with authority in the following matter:

“The ASC’s mission is to ensure that real estate appraisers, who perform appraisals in real estate transactions that could expose the United States government to financial loss, are sufficiently trained and tested to assure competency and independent judgment according to uniform high professional standards and ethics.” From the ASC website.

The concern of this petition has to do with “Unearned Fees, and Unqualified Appraisal Managers” in performing real estate appraisals.

We, the undersigned, represent a large number of licensed and certified real estate appraisers, lenders, and consumers in the United States, who seek your assistance in solving a problem facing us on a daily basis. Appraisal Management Companies (meaning any and all of the following: , AMC, Appraisal Servicing Companies, Appraisal Placement Companies, Appraisal Vendors, Appraisers, and Appraisal Companies) have individuals within their ranks, who, as a normal course of business, charge fees that exceed the amount that is actually paid to the licensed or certified appraiser that completes an appraisal assignment. The extra fees constitute unearned fees that are charged directly to the consumer. These companies typically do not staff or employee professionals that are qualified to accept appraisal assignments. The Appraisal Management Companies accept orders for appraisals. Then they contract this work out to independent fee appraisers and keep part of the appraisal fee that is charged to the consumer. The fees that the Appraisal Management Companies keep are in most instances titled as appraisal fees and consumers are not made aware that part of the “Appraisal Fee” is for Appraisal Management Services.
The banking community has been aware of this issue for many years. Bank, Lenders, Brokers, and other Financial or Lending Related Companies that want to profit from Appraisal Fees simply form Appraisal Management Companies in order to pass on excessive fees to unknowing consumers. When Appraiser complain about these unethical practices Lenders and Appraisal Management Companies answer these complaints with the following:

the withholding of business, and black listing honest appraisers.

We request that action be taken to hold the lenders and Appraisal Management Companies responsible for this type of violation and provide a penalty for any person or business who engages in the practice of charging unearned or excessive fees to consumers, not disclosing Appraisal Management Fees and or calling them Appraisal Fees, and Accepting Appraisal Orders for which they have no qualification to complete. Companies or indiveduals that accept orders or contract to manage or complete Appraisal Assignments should be qualified or directly employee qualified appraisers that are USPAP compliant. We believe that this practice has an adverse effects on our local and national economies and that the potential for great financial loss exists. We also believe that many individuals have been adversely affected by the excess management fees that are labeled or titled as Appraisal Fees. We believe that many times these fees are paid to individuals or business that are not qualified and do not employ qualified appraisers that are USPAP complaint. We also believe that consumers are mislead into believing that they are paying for Appraisal Services and do not know that a portion of the fee is for “Management Services”. We believe that these kind of fees are deceptive and constitute unearned fees. We also believe that in their desire to profit from Appraisal Fees these companies and individuals have had an adverse affect on the American Appraisal Industry.

We thank you for your cooperation and assistance.

Sign The Petition:

http://www.ipetitions.com/petition/AppraisalManagement/
 

Excessive fees and “packing” – This involves charging the borrower fees that are too high for the services provided, and also the practice of hiding or “packing” fees into the loan amount without the borrower’s knowledge or understanding.

Like loan flipping, packing robs property owners of their hard-earned equity.  The excessive fees are not paid directly from the borrower’s pocket; instead, they are rolled into the loan amount.  In a case like this, a borrower who they are rolled into the loan amount.  In a case like this, a borrower who intended to borrow $50,000 on his home could – unwittingly – end up with a mortgage of $60,000, of which $10,000 goes directly to the broker or lender.

In April 2006, Fannie Mae announced that it will not purchase or securitize a mortgage if the total points and fees charged to the borrower exceed 5% of the mortgage amount.  For example, on a $100,000 loan to be purchased by Fannie Mae, the fees and points charged to the borrower cannot exceed $5000.

Just as in loan flipping, “packing” cannot occur without an inflated appraisal.  Because these “packed” fees are part of the loan amount, the property must appraise high enough so that this additional amount can be borrowed.