Sunday, February 14, 2010

Appraiser calls for regulation of middlemen

Appraisers nationwide are petitioning lawmakers to regulate AMCs. An example from Pueblo, CO:

"Pueblo appraiser Ivor Hill on Tuesday urged state lawmakers to adopt standards and regulate appraisal management companies.

"Appraisal management companies capitalized on the new standards, geared at buffering unethical dealings between mortgage lenders and appraisers, by marketing themselves as required by the HVCC, when in fact they are not.

"Other real estate professionals joined Hill in criticizing how appraisal management companies operate. Hill testified that the companies charge mortgage lenders excessive fees to act as middlemen, then solicit bargain-basement appraisals to turn a profit, often at the expense of the borrower and the quality of the appraisal.

"That was verified by Erin Toll, executive director of the Colorado Division of Real Estate, who said appraiser license renewals are down in part because of the low-ball fees being brokered by the companies. Consequently, she said, experienced, knowledgeable appraisers are leaving the field because they are being priced out by less experienced appraisers whose work is not of the same standard. Hill pointed to Equifax, an appraisal management company that just this week sent out e-mails to appraisers stating that the fees it offers would be cut by 10 percent.

" 'The type of appraisers that will work for that kind of money is the first-time appraiser with no experience,' Hill said. 'Quality of appraisals suffer.' "


1 comment:

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