New AMC – 8 hour turn time!!

By on April 3, 2013   /   AMCs, appraisal management company, humor   /   6 Comments
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An AMC to Keep Pace With?
Q&A with Richard Johnson of Pacer AMC
April 1, 2013
Appraisal Buzz

BUZZ: How will you differentiate your company from the other 500 AMCs?

RICHARD: We have created a unique appraiser scorecard. We have an algorithm that measures the appraiser’s self esteem. We find appraisers who set a low fee, never complain when we are a slow pay, and love challenging assignments. We have no dress code. Appraisers just hate that.

We have spent a lot of time picking the best appraisers for our assignments. We call it dialing for dollars. We reward our processers based upon setting new lows.

Because we are the low cost provider we attract the very largest lenders in the US.. These large lenders too have an algorithm that includes input as to the cost of regulation. They have figured out the risk of penalties and fines is somewhere between slim and none. They have lobbyists to ensure that. We have hitched our star to their wagon.

BUZZ: What is this we have heard of your 8 hour Turn Times?

RICHARD: One of the ways we feel we can stay ahead of our competition is we have instituted an 8 hour turn time. We feel it shouldn’t be too hard to get all our appraisals done the same day they are assigned.

Of course we are not unreasonable though if a property is over 250 miles away we allow an extra 2 hours to submit your report.

BUZZ: With all the transparency, disclosures and Customary & Reasonable laws how do you get away with being the low cost provider?

RICHARD: It is really simple. We know our clients love AMCs because they get our services for free. It is the greatest business on the planet. The appraiser pays for the services for the lender. What a racket. We find appraisers who are willing to drive anywhere and do anything for an ungodly low fee.

We don’t worry about compliance because the appraiser signs an affidavit that certifies we have paid them a customary and reasonable fee. Have you seen the CFPB enforce any appraisal rules ? No of course not. Zero risk for lenders and AMCs.

My comment: be sure to click on the link and read the rest of the articled before you let your blood pressure go way up ;> It was published on April Fools Day!!

http://appraisalbuzz.com/an-amc-to-keep-pace-with

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75% of appraisers work solo

By on March 26, 2013   /   appraisers   /   3 Comments
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Real Estate Appraisal in the US: Market Research Report
Thanks to Appraisalscoop.com for this Most Interesting info!!

My comment: Unfortunately, the report costs $825. I’m not sure who would buy it, but below are some interesting excerpts. It does confirm that 75% of appraisers do not have any employees.

I did a surveys in 1992, just as licensing was beginning. At that time, relatively few appraisers worked solo (22%). 25% had 2-3 appraisers, 25% had 4-6 appraisers, and 27% had 7+ appraisers. The average was 5.4 appraisers per company. Number of years of experience of The business owners had 5-10 years of experience. I had three appraisers.

Around 1995 came a big crash, and many of us downsized to one appraiser. Few of us went back up to the old days. Newer appraisers in the mid-2000s hired lots of trainees to increase firm size. Most of them have gone back to one appraiser. Same Old Cycle. Nothing New.

Excerpts from report:

The top five firms in the Real  Estate Appraisal industry account for less than 15.0% of industry revenue  with the largest having a market share of just 6.2%. The larger participants in  the industry are generally subdivisions of large multinational property,  brokerage, and global real estate service firms. The vast majority of companies  operating in the industry are small, independent firms with few employees or  single-owner operators.

According to the US Census and IBISWorld estimates, 75.3% of establishments are nonemployers. From 2008 to 2010, the total number of  establishments in the industry was decreasing. The number of nonemployer  establishments was decreasing at a faster rate than employer firms. This trend, however, has reversed recently.

Click here to read more and post your comments at www.appraisalscoop.com .

http://appraisalnewsonline.typepad.com/appraisal_news_for_real_e/2013/03/real-estate-appraisal-in-the-us-industry-market-research-report-from-ibisworld-has-been-updated.html

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Excerpt from press release
Over the past two years, however, IBISWorld expects that industry revenue has recovered substantially, and estimates it will grow 6.7% in 2013 as the volume of real estate transactions increases and property values continue to recover from recessionary lows

Link to press release with more info:
http://www.prweb.com/releases/2013/3/prweb10545179.htm

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Source of Work – refis and foreclosures

By on March 25, 2013   /   appraisal   /   Leave a comment
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www.appraisalport.com

Excerpt:

As we all know, the housing market has been going through some major changes over the past years. As the market changes, so does the source of many appraisal assignments. This month we ran some polls to see how much work is generated from both refinance activity and foreclosure activity.

The first poll asked, “How much of your work comes from refinance activity?” and received a total of 5,404 responses. The results show refinance activity accounts for a good portion of the current appraisal assignments. No surprise there. The top answer was, “I do 51%-75% refinance work,” with 35% of the vote. A close second was, “I do 25%-50% refinance work,” with 30% of the vote. Quite a large group (20% of the appraisers) responded that more than 75% of their work is for a refinance loan. This work seems to be holding steady for now and should continue if interest rates stay at these historical lows.

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The second poll asked a similar question, but instead of refinance work, the focus was switched to foreclosure work. We had 5,395 total responses to this poll and we found that foreclosure assignments make up a much smaller portion of work volume for appraisers. There are a couple of potential reasons why foreclosure work isn’t as important for appraisers when compared to refinance work.

First, often foreclosure work is done by brokers providing BPOs, rather than by lenders ordering a full appraisal. Second, the default and foreclosure rate is actually falling rapidly in most areas of the country, which is good news for everyone. The top answer with 60% of the vote was that less than 25% of the work volume comes from foreclosures. Keep in mind that this answer includes those who get 0% of their work from foreclosures. About 22% of appraisers responded that they still get 25%-50% of their work from foreclosure activity. The last two possible responses of 51%-75% and more than 75% were essentially tied, each category receiving approximately 9% of the vote. So we can conclude appraisers are not currently heavily dependent on foreclosure activity for new assignments.

My comments: nothing new here. BofA’s recent appraiser layoffs and other layoffs due to shrinking foreclosures show that this is happening. They love their BPOs for foreclosures. There is work for Fannie and others trying to get money from appraisers who were to “high” in the boom time.

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National Appraisal Compliant Hot Line to start by 3/29/13 Appraisal organizations ask for delay

By on February 28, 2013   /   appraisal, Appraisal Foundation   /   7 Comments
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ASC notice to state regulators:
Excerpt: The Hotline will begin operation no later than March 29,2013. The Hotline will refer complainants to appropriate State and/or Federal agencies to handlecomplaints of alleged violations of the Uniform Standards of Professional Appraisal Practice(USPAP) and/or appraisal independence requirements. The Hotline will direct complainants tocontact you to formally file their complaint using the existing protocols established by your State.The Hotline does not initiate complaints, act on behalf of complainants, arbitrate complaints, assistin appealing the outcome of complaints, or follow up on complaint referrals previously provided

Link to full notice:
http://www.scribd.com/doc/126820613/ASC-Appraisal-Complaint-National-Hotline-Notice-to-States
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Feb 4, ASA/NAIFA sends letter to ASC asking for delay

Excerpts of a few bullet points:
– The ASC designed the appraisal complaint hotline system behind closed doors, and has failed to allow stakeholders to comment on it prior to final implementation:
– The ASC’s hotline system, as proposed, violates congressional intent and the clear language of the dodd-frank provision authorizing it:
– Congress intended the hotline to provide appraisers with an ability to report efforts to undermine their independence, not as a catch-all mechanism to be used against appraisers by persons disgruntled because the appraised value did not meet their needs or for other non-specific or Non-serious reasons:

Link to letter http://c.ymcdn.com/sites/www.naifa.com/resource/resmgr/legislation/02.07.2013_letter_from_asa_a.pdf

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Feb 12, AI/ASFMRA sends letter to ASC asking for delay

Excerpt:

However, in speaking with state appraiser regulatory officials, practicing appraisers and others involved with real estate and mortgage finance, virtually no understanding of the hotline and its intended purpose, as well as the proposed protocol, exists. As such, we believe that the protocol could be met with unnecessary trepidation simply because to date the ASC did not seek stakeholder input. As such, we respectfully request that the ASC refrain from approving the protocol, and instead release the protocol for public comment, similar to the process used by the ASC in drafting Policy Statements. Since the hotline likely will impact other mortgage and real estate professionals and regulatory agencies, we believe that all stakeholders deserve to have an opportunity to review comment on the hotline before it is operational. This is the foundation of good government and, in this case, we believe that such a measure actually will engender support for the proposed protocol.

Link to AI/ASFMRA letter
http://www.appraisalinstitute.org/newsadvocacy/downloads/ltrs_tstmny/2013/AI-ASFMRA-to-ASC-on-Hotline.pdf

My comments: The ASC was mandated by law to set this up. I have not read all these links, so I have no opinion. It is all up to you!!

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So, just how accurate is the Zillow “Zestimate” anyway?

By on February 19, 2013   /   appraisal   /   32 Comments
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Thanks to appraiser Tom Horn for this Most Interesting video!

Have you ever wondered how accurate the Zillow “Zestimate” really is? Whenever I am doing appraisals I have homeowners tell me what their Zillow “Zestimate” is. I am sure they are hoping that my appraisal is similar to that number (if it is high), however the two could be close, but more times that not they are pretty far apart.

I actually just found out recently how you can determine the accuracy of Zillow in your area. Take a look at the video to learn how.

[youtube=http://www.youtube.com/watch?v=1pT9HPqsu-I&feature=player_embedded]

click here to see the original blog posting

1-1 GOOD AT final rev newslet

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