…of APPRAISAL MANAGEMENT COMPANIES
What is an Appraisal Management Company (or AMC)?
There is an appraisal code of conduct that all Lenders must follow, called the Home Valuation Code of Conduct (or HVCC). Many lenders have created, or have an equitable interest in, AMCs as a way to profit off of the HVCC rules by forcing appraisals to be ordered through the AMC of their choice. This is done at the borrower’s expense.
AMCs get to keep more than half the money for the appraisal, and the actual appraiser doing all of the work gets the balance. Most AMCs charge $400-$450 per appraisal, and the individual appraiser gets an average of $150-$200 for doing all the work. The AMC simply profits the balance while not doing any work or even being a licensed appraisal company. This has led to less than adequate appraisal reports. Many individual appraisers refuse to join an AMC because of lack of payment equal to the job required.
There is no licensing requirement to own an AMC!
The forced use of the AMCs by lenders is under tremendous public and private scrutiny. It is being reviewed by the Government and HUD with the potential to remove the HVCC code completely from the reverse mortgage industry. Most importantly, YOU as a homeowner can not even order your own appraisal other than for personal use. It will not be accepted by any LENDER because it was not ordered by the Lender at an AMC of THEIR choosing.
Little pay + No accountability = Bad finished product = low appraised value for the client, YOU
How are we different? We ARE the Lender!
We pick our appraisal system we want to use. We are NOT forced into AMCs. We maintain 100% compliance with the Home Valuation Code of Conduct. HUD clearly specified in its Mortgagee Letter 2009-28 that, “FHA does not require the use of AMCs or other 3rd party organizations for appraisal ordering.”
How do we order appraisals? Our advantage is your advantage!
We have a random rotation of appraisers that we have done business with in the past, they all provide superior service, and are all licensed and insured and fully HVCC compliant. We have absolute trust that they will give our clients the actual value and best possible service that can be delivered. WE DO NOT USE AMCs! This provides a high level of local knowledge and work product, especially since all of the money you pay goes to the individual appraiser themselves.
I feel that this will provide the best possible work product for you. I have case studies and client testimonials that can confirm that the use of a non AMC appraisal will deliver better quality than lenders that require AMCs.
How can you be sure this is true? It’s all on the internet…
All of this can be researched online. Just look for blogs or articles from Realtors, Appraisers, and Mortgage Professionals complaining about AMCs that have made their clients lose properties or mortgages. The idea and concept of the AMC has been an incredibly disappointing change that is not required by HUD but being forced by the individual lenders. This is single handedly hurting homeowners, like yourself, with unjust and sub par work product.
Thank you for taking to time to learn more about how the process will work for you!