Over the past few weeks VaCAP has been hearing from our members on some of the concerns they have with how amcs are conducting themselves.
It started when appraisers on the USDA panel received notifications that USDA was no longer ordering appraisals directly and that task has been outsourced. Verdi Consulting and Jones Lang LaSalle have received the contracts from USDA for appraisal origination. Neither of these companies are licensed as an appraisal management company in Virginia and they are using two amcs as subcontractors; Valligent and Clarocity. Most appraisers we heard from were highly concerned as neither of these companies have a positive reputation among appraisers. Many appraisers we heard from shared they would not be signing up with either of these companies.
Then appraisers reported being solicited for fee and turn times from both Clarocity and Valligent on properties several hours away from their market coverage. Every appraiser is aware any amc asking for a fee and turn time is seeking to find the lowest priced appraisal, regardless of location, complexity or appraiser experience. Searching for appraisers outside of the market area is a huge red flag on how the amc operates.
USDA makes loans in rural areas to low income borrowers. These loans are already a higher risk and fee shopping for the lowest priced appraisers increases that risk unnecessarily. We have to question if this is what USDA anticipated when they outsourced appraisals. AppraisersBlogs published an article on this very topic. Take a look here.
Now Amrock has stepped up there micromanagement and announced starting in 2020 when an appraiser accepts an appraisal assignment, the appraiser must input three dates and times for the borrower/contact to choose. VaCAP heard from a few appraisers, but social media exploded over this announcement. This simply does not work on any level. Not from the appraisers point of view and not from the borrowers point of view. The need for speed and technology at Amrock is actually a hindrance to the appraisal process.
A few things will happen if Amrock follows through with this extremely poor decision. First, appraisers are simply not going to work for Amrock any longer. There will be borrower complaints because the times available do not work for them. Perhaps the most detrimental outcome will be longer turn times and higher fees charged by the appraiser due to the inefficiency of their system.
When appraisers call to schedule an appointment, they talk with the borrower about the property; condition, improvements, needed repairs, etc. We also explain the lender requirements of photographing every room and any specific requirements for FHA of VA. During this process, both the appraiser and borrower have built a trust so it runs more smoothly during the appraisal inspection. Skipping this crucial step will due more harm than good.
Amrock’s policy really begs the question, especially in light of the recently passed California AB-5 law in employee classification requirements, has Amrock crossed the line from an independent contractor to employee status?
Now to top off this insanity see the below solicitation that was forwarded to VaCAP. This new amc has a different approach. You just have to laugh…..
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