Appraisal News and Business Tips


AMC Declares Bankruptcy: What Appraisers Need To Know About Bankruptcy

By Ramir Rodriguez

You received a letter in the mail informing you that your client has filed for .  It is this moment you realize that this bad news just became your problem.

Many of us are familiar with the recent bankruptcy filings of and its  bankruptcysubsidiary .  Peter Christensen, attorney and general counsel to LIA Administrators & Insurance Services, shared in his blog that the total unpaid fees to , agents, and brokers as listed in bankruptcy documents is $11,048,411.97!  This is a remarkable amount.  Evaluation Solutions’ bankruptcy documents accounted for $9,349,612.97 of the total amount and a separate filing of its subsidiary was for $1,698,799.

I Received A Notice… Now What?

If you received a notice regarding Evaluation Solutions/ES ’ (I will refer to them as ES) bankruptcy you may be wondering what the next step is to try and recover money owed to you.  Yes, a client’s bankruptcy can be costly for you, but most importantly, not adhering to the rules of the bankruptcy process can cost you significantly more.

Knowing the types of bankruptcy, how to play by the rules, and what you can (or can’t do) will help you understand the scope of your problem and ensure you don’t get in trouble.

Types of Bankruptcy

There are lots of information you can gather from the bankruptcy notice from ES to help you understand the nature of this problem.  But first you must recognize the type of bankruptcy ES is filing.

Chapter 7 – This type of bankruptcy is the liquidation of remaining assets to distribute among its creditors.

Chapter 11 – This a financial reorganization of a business, which allows your client to function while they follow court ordered debt repayment plans.

Chapter 13 – Similar to Chapter 11, but rather than a business filing bankruptcy it is the individual reorganizing and following a debt repayment plan.

Ideally, it’s more favorable on your end if your client files for either Chapter 11 or 13.  These types of bankruptcy give your client a breather until they figure out how to repay.

If your client however files for Chapter 7, which is what ES filed, not only will your chances of getting paid be reduced, but also you may be waiting a long time (even years) for this type of case to be completed.

Take A Number

At this point you are probably frustrated and would like to call someone to attempt to collect your money.  Stop right there!  Your actions can get you in deep waters.  If you attempt to make phone calls to ES’s accounting department, send nasty letters, or try to file a lien (which some appraisers have done in other instances and is not recommended), you will face penalties.

Assuming you do get some money owed to you, you will have to wait in line.  This is the second item you must understand.  Here’s the payment order:

  1. Lawyers, administrative expenses, and other professional services that are involved pulling hairwith the work of filing the bankruptcy.
  2. Secured claims, including mortgage holders.
  3. Priority claims, including wages and taxes.
  4. Unsecured claims, which is where you as an may be categorized.
  5. Equity claims, including stockholders.

So curb your frustration because all you can do at this point is wait.

What Can You Do While You Wait

Sure you have to wait for ES’s bankruptcy process to take its course, but there are some things you can do in the interim.  Since this case can drag for a long period of time, you can do the following:

  1. Consult with your CPA about taking a deduction on your taxes for the bad debt.  If you manage to receive some money owed to you after the bankruptcy case is settled you can claim it as income at that time.  See your accountant for more details.
  2. It does not apply in this case, but if you have a future instance where your client files for Chapter 11 or 13 and wants to continue a working relationship, it may be to your advantage.  Of course your immediate reaction is to quickly say “no way!”, but understand that Chapter 11 and 13 require debtors to stay current on all accounts moving forward.  This means you can add a fee to your to recover what was lost, stricter payment time frames, and maybe exclusivity as other appraisers may not take another chance.  Keep in mind that the best way to reduce or eliminate risks is to get paid up front.

 Improve And Move On

Now that you’re somewhat familiar with the types of bankruptcy, payment pecking order, and what you may be able to do as the bankruptcy takes its course, it is important prepare for the future.  This means assessing your and how to prevent this problem from happening again.

First, create a process on how to screen new clients by knowing their payment history.  There are many tools and resources you can use online that are free or for a small fee.  Second, improve your accounts receivable aging management procedures.  Just because they are still “current” doesn’t mean it does not require all of your attention.  Current receivables can quickly turn into problems if you don’t pay attention.  Last but not least, be persistent and tough but professional with your collections.

If you have an AMC bill in your state, read it and educate yourself on how it can help your appraisal business.  There are sections in most AMC bills that require AMCs to pay by a certain time frame.  For example, Texas AMC bill requires AMCs to pay appraisers within 60 days.

Also consider resources available to you such as your receivables where the risk of non-payment is transferred to the company.  In this case, you can get paid quickly without the responsibility of collecting and liability of non-payments.

No small business is immune to the unexpected, but you can certainly minimize you risks as work towards a successful 2013.

Guest blogger:  Ramir Rodriguez  represents Treasure  Valley Factors
in Fruitland, Idaho. He has  helped real estate  appraisers
understand how factoring can can help their business since 2009.
For more questions about factoring ,
please  email him at
or visit his blog Factoring Helps or
Twitter: @RamirRodriguez
"Like" Treasure Valley Factors on Facebook!
Posted in: AMCs, appraisal management company, lender appraisals

How old are appraisers and when do they plan to retire?

To keep up on what is happening in appraisal businesses, mortgage lending, USPAP, etc. , Plus humor and strange homes, sign up for my FREE weekly appraisal email newsletter, sent since June 1994. Go to Home on the left side of the menu at the top of this page or go to
Sign up in the Big Yellow Boxes

I regularly write about hot topics in appraising and appraisal business management issues
in my paid Appraisal Today monthly newsletter.
$99 per year or (credit card only) $8.25 per month, $24.75 per quarter, or $89 per year.
For more info, go to

How old are appraisers and when do they plan to retire?

Appraisalport poll – 1/7/13

If you are licensed or certified, what is your age range?
21 to 30 (2%) 138 votes
31 to 40 (15%) 1,027 votes
41 to 50 (30%) 2,095 votes
51 to 60 (42%) 2,284 votes
61 to 70 (16%) 1,113 votes
Over 70 (3%) 228 votes

Total Votes: 6,885

My comments:
I keep hearing about the “aging” of the appraisal profession. The latest average I heard was 62 (I think). The person did not know the source of the number. When I started my business in 1985, the average age (AIREA members) was 52. The poll above shows that active appraisers are not as old as everyone is speculating. I assume that users of AppraisalPort are active residential appraisers.

Like every other type of work, the baby boomer bulge is increasing the average age for many types of workers, not just appraisers. Another significant factor is that many, if notold woman driving most, workers approaching 65 plan to keep working, for various reasons. Mandatory retirement at 65 is gone for almost all workers. Retirement savings investment yields are low. Few people, except teachers, government employees, and some union workers have defined benefit pensions.

Appraisers tend to be older as appraising is a second career for many of us. (It is my third career.) The number between 41 and 61 is 72%. There are fewer newer appraisers as many left the business during the recent downturn. This is what happens in the inevitable residential lending downcycles.

The over 70 number seems relatively low, probably because the first Baby Boomers are now 66 years old. Many people I know between 66 and early 70s are still working and plan to continue. However, we are cutting back on work hours. No more 60-80 hour work weeks for us!! (I will be 70 this year.) Yes, there are a few licensed appraisers over the age of 90!!

Personally, I don’t care about the problems of lenders finding armies of trainees for the next upcycle. There will always be experienced residential appraisers needed. Lenders have been wanting to get rid of unnecessary deal-killer appraisers since they first started using them during the Great Depression.


AppraisalPort poll – 1/21/13
I plan to retire or leave the appraisal business within the next:
5 years (22%) 1,304 votes
6-10 years (17%) 1,056 votes
11-15 years (15%) 938 votes
16-20 years (14%) 825 votes
21 or more years (15%) 938 votes
Not sure at this point (16%) 991 votes

Total Votes: 6,052

yes no maybeMy comments: Very interesting and not as definite as the age poll above, which had 19% over the age of 61. I would have also expected more “not sures” than 16%. I am not sure myself when I will retire, meaning giving up my appraisal license and designations. In California, you only have a one year grace period to reinstate your license, then you go back to a trainee and do everything all over again.

I strongly recommend that appraisers keep your license if you possible can. It is not that difficult to get a few non-lender appraisals a month, which can keep you somewhat active and give you few extra bucks. Also, if you really need more money, you can do more appraisals. It is a lot easier and you make a lot more money than taking a part time WalMart job.

9/20 Update: not much has changed, except the average appraiser age is around 60. No new trainees due to AMCs requiring state certification plus 5 years experience to be approved. Baby boomer aging.

Posted in: unusual homes

30+ of the most beautiful abandoned places and modern ruins

St Etienne by Jurg Roessen

Click here to go to the original blog post.

Stunning NYC Subway Station Hidden in Plain Sight, Until Now



Posted in: unusual homes

Luna Parc – strange home and other stuff in New Jersey!!


Excerpt from article:
Upon entering the gates to Luna Parc, you are awestruck at the immensity of the project Boscarino has been building in the woods for all these years. The front yard is awash in brilliantly colored sculptures, walls and spires. Everything is encrusted with swirling mosaics of tile, glass, concrete and painted metal. The house itself sits above the terraced yard looking like a technicolor gingerbread chalet in a psychedelic fantasy land.

Ricky, the proud creator of this unique home, is friendly and easy-going and always willing to give us a tour of the newest additions he has made to his one-of-a-kind-eastate in progress. We asked him how he first found the property.

“I grew up in Piscataway and I used to go to summer camp at Stokes, so I kinda knew the area a little. I started a jewelry business in 1986 and I was looking for a place of my own. I really just stumbled upon this place after pounding the pavement for about two years. It was an old hunting lodge, and the family that owned it hadn’t even been here for about ten years.”

Posted in: unusual homes

Appraiser comedian at the Punchline

Appraiser David Cash at the Punchline Comedy Club.
An oldie from 2008 but a goodie!! A blast from the past, pre-HVCC!!

I searched online but could not find any more videos. Also, there are lots of David Cash appraisers and I was not sure which one did this. I did find some other David Cash’s such as a hip-hop musician!!

If you know anything, please leave a comment!!


1-1 GOOD AT final rev newslet

Posted in: appraisal, humor

The conic "Trulli" dwellings in (Apulia / Italy)

Trulli (trullo in singular) are round or square dwellings or storebuildings with cone shaped roofs found in the Itria valley in the Apulian region of southern Italy. They are traditionally built completely without mortar – to avoid taxation, it’s been said. Allthough some foundations can be traced back to the Neolithic period, really ancient trulli don’t exist, because people used to tear them down when they became rickety and rebuild them or build new ones using the material from the ones they tore down. New trulli are still being constructed the traditional way.

Traditional symbols of good luck and protection against the evil eye are painted on the roofs. They can be pagan, Jewish, Christain, Hellenic, magical – some are so old nobody remembers their origin or exactly what they mean.

Click here to see more fotos

Posted in: Strange homes, unusual homes

The Value of Evaluators

Another great article from the Illinois appraisal regulator


The argument to promote evaluations as an alternative to appraisals was driven by rural lenders who feared a shortage of appraisers might slow down closings. That was it. That was the main beef. A simple supply and demand issue for banks in the boonies… twenty years ago! An evaluation was regarded as “a generally simpler assessmentmonkeys see hear no evil
of real estate market value.”

Evaluations versus Appraisals (2012) —
The most recent incarnation of the Interagency Appraisal and Evaluation Guidelines emerged in December of 2010. Section XIII provides the suggested content of a evaluation…“a generally simpler assessment of real estate market value.

(BPOs cannot be used for evaluations.) A valuation method that does not provide a property’s market value or sufficient information and analysis to support the value conclusion is not acceptable as an evaluation. For example, a valuation method that
provides a sales or list price, such as a broker price opinion, cannot be used as an evaluation because, among other things, it does not provide a property’s market value.

1-1 GOOD AT final rev newslet

If you want to know what the feds meant by “a simpler assessment”, go ask them. I’d love to hear that explanation myself.

Many AMCs, while eager to take on the evaluation function, fail to understand who is ultimately responsible for the entire program. (Their clients, the lenders)

Banks cannot hand‐off liability to AMCs like a hot potato just because they can’t be bothered managing their own evaluation program. If an AMC makes a mess of the bank’s
evaluation program, the responsibility of the failure falls squarely back on the bank.

Turning an evaluation into an USPAP compliant appraisal takes far less effort than trying to cobble together a cadre of competent and reliable evaluators to provide something that by state statute,must fall short of an appraisal.

My comment: This is an issue that has been around since the early 1990s. What does an evaluation mean? Cheap and fast. Banks want them. AMCs would love to provide them. I have no idea who would do them and what they look like. I have no idea how a licensed appraiser would do them as they must be USPAP compliant.

Seems easier to me just to do an appraisal. Maybe a shorter appraisal that is not 30 pages long with 9 comps and pages and pages of explanations!! Now that is a very practical idea. Just go back to the past pre-HVCC and incredible scope creep since then.

Click here to read the full newsletter article.

Posted in: AMCs, appraisal, appraisal management company, lender appraisals

Cave dwellings (Sassi di Matera / Italy)

This awesome place in the town of Matera in the region of Basilicata, Italy, is carved out from the soft tuff rock mountain (sassi = rocks). In 1952 the inhabitants were forcefully relocated by the government due to breakdown of the dwellings’ complicated ecosystems and lack of sanitary systems, but that’s changing now that they have entered Unesco’s World Heritage list (1993). One of the main reasons for the inclusion on the list is the enormous rainwater collection system, another reason is of course the age – the oldest inhabited parts date from the Palaeolithic period, and are thought to be among the first human settlements on the entire peninsula. Several caves have been carefully restored, parts as museum, but most as proper homes, or as holiday homes, small businesses, hotels, and B&Bs.

Click here for more fotos

Posted in: unusual homes

Appraisal client requests for clarification

AppraisalPort Weekly Poll Analysis – client requests for clarification
By Steve Costello, AppraisalPort Product Manager

I receive a lot of e-mail from appraisers commenting about the time they spend working onstress - hitting head on keyboard requests for clarification on appraisals they have submitted to their clients. That prompted me to post two polls related to these client requests.

“What percent of your assignments result in a request for clarification from the client?
The results were a little different than expected with nearly half (45%) of the 4,691 respondents stating that they only get a clarification request 0%-10% of the time. That is actually lower than expected based on what I hear from appraisers directly.
The second most popular answer was 11%-20% of the time with about 19% of the vote. The number of votes continued to get smaller as the percentages increased (13% chose 21%-30% while another 8% answered 31%-40%).
After that, things take a bump up. Nearly 15% of the appraisers responded that they get a request for clarification on more than 40% of their appraisals. I can see where that level of requests could make it difficult to get the new work completed on time.

“How often does your client requests information that is already in the original submitted report?”
In other words, we are asking how many of the above requests for clarification were un-necessary because the client already had the needed information.
This was a popular poll with 5,632 responses and the overwhelming answer was “often” with 60% of the vote.
About 27% responded that they “rarely” run into this situation while only 1% said it “never” happens to them.
Another 12% answered that this “almost always” happens.
So it looks as if we have a fairly large number of appraisers being asked for additional information that is already contained in the report.

My comment: nothing new here but I do like the analysis of the data. I love working for my estate clients. The dead people never request any clarifications (except maybe their executor contacts me when I have the wrong subject property address) ;>

Posted in: AMCs, appraisal management company, lender appraisals

Dear Clipboard and Measuring Wheel – A Walk Down Memory Lane

By Dustin Harris, The Appraiser Coach

Hey!  How have you been?  Sorry I have not written in a while.  Wow, I cannot believe it has been over 15 years since I broke up with you.  How time flies.  My purpose in writing is not to make you feel bad, but I am not disappointed that we parted ways, and I honestly do not miss you two… at all.  I know that seems harsh, but you said I would be sorry, and I just wanted you to know that you were wrong… again.

Oh, in the beginning, I thought I had made a huge mistake.  My new flings were not as easy to get used to as you were. There was that one night, early on, where I had a little cry, ate an entire carton of Ben and Jerry’s, and almost broke up and came running back to you.  How glad I am that I did not.  That would have been a huge mistake.  Why?  Despite your warnings, your replacements have loved me without condition, been nearly completely faithful, and have allowed me to be more efficient and more accurate than I ever was with you.  Though they may have cost more in the beginning, they have paid for themselves over and over and over.

measuring wheel Measuring Wheel, I am sorry for the jealousy I caused you when I left you for Disto.  I still remember the harsh words you spewed at me as I laid you in the trunk of the car as a ‘backup.’  You said, “You will regret this!  Her smaller frame and fancy red laser can never replace me.  You will, I repeat, WILL be back.”  In all honesty, I thought at the time that you might have been correct.  That is why I carried you around for so many years even after turning my attention to Disto.  Please accept my apology that I never did pick you up again, even for a short fling.  I just cannot tell you how happy I am now with Disto by my side.  Is she accurate?  So much so that I have to ‘dumb her down’ a bit in order to meet ANSII standards of measuring to the nearest half foot.  “But, what about those really sunny days or walls that do not have anything to bounce off of” you ask?  Let me just say that everyone had a period of ‘getting used to.”  She had hers as well (and honestly, it was longer than it took to get used to you), but once I understood what makes her tick and how to really ‘push her buttons,’ I have never met a wall I could not measure with her since.  She and I are quite a team now.  Granted, she will never protect me like you did (remember that time I used you to beat that vicious dog over the head?), but thankfully I have never had an incident like that one again.

Clipboard, I know you were angry when I put you in the backseat and started holding a pocket PC instead.  Though Jornada™ seems a little antiquated now, she was light years ahead of you at the time.  Maybe it will make you feel a little better if I told you she did not last either.  Yes, I have now replaced her as well.  Before you start accusing me of being a ‘player,’ you should know I stuck with her for many more years than I ever was with you, and her replacement was a huge step forward.  Yep, I am now hanging with the iPad.  clipboardInterestingly, you will remember that I ditched you for the more petite replacement, but my steady now is almost the same size as you (though she is a tad more heavy—so you at least have that).  Remember when we were together how I would sometimes get clear back to my office before I realized that I had forgotten to take a picture or the two sides of my sketch did not match?  Then, you and I would have to get back in the car for another ‘date’ to the subject property?  Well, those days are so 1997.  iPad never allows me to leave the property without knowing that I have everything I need and that everything matches as it should.  How cool is that?

I know what you are saying, Clipboard.  You think that I am spending more time at the subject than I ever did with you.  OK.  I admit it.  This time you are right (I bet you never thought you would hear those words from me).  I am spending an average of 5 additional minutes at the inspection, but that is not where the time savings comes in.  The efficiency factor comes into play when I get back to the office.  Remember how I used to have to come back to my desk and stare at you for dozens of minutes while I transferred my chicken scratches into the appraisal software?  I know you liked all the attention, but I do not do that anymore.  All that data transfers into the report on its own.  You heard me correctly, all the data, the sketch, and pictures are all there when I get back to my office.  You could never do that for me, Clipboard.

As I reread this letter, I guess I have been hard on you two.  Maybe I shouldn’t send it, but my purpose is not to tear you down, and I am certainly not trying to pour salt in old wounds.  I only think it is fair, since so many appraisers are still spending so much time with you, that you know where you stand.  Just because you are popular does not mean you are better.  There, I said it.  I am sorry if that hurts, but there are other fish in the proverbial sea, as they say.  It is time that other appraisers follow my lead and ditch you guys.  Breaking up is hard to do, but it was a great decision for me, and I know it will be for others as well.  Sometimes we gotta put you relics on the shelves and move on.  Please do not feel bad.  Perhaps it is time for a makeover.  Clipboard, maybe you could round yourself off a bit and get rid of that hideous, metal growth and start a new life as a Frisbee.  And Measuring Wheel; you still make a pretty good billy club.

Wishing you All the Best,

Dustin Harris

The Appraiser Coach

Dustin Harris is a multi-business owner and residential real estate appraiser. He has been appraising for nearly two decades. He is the owner and President of Appraisal Precision and Consulting Group, Inc. He owns and operates The Appraiser Coach where he personally advises and mentors other appraisers. He is also the Founder and President of The Appraisal Coach which implements some of the systems he has developed to help lower costs and free up time. His principles and methodologies are also taught in an online, Mastermind group. He and his wife reside in Idaho with their four children.

AT final rev newslet

Posted in: appraisal, appraisers