Appraiser Question: "I received an order from an Appraisal Management Company (AMC) that requested I bill the client $75 more than my standard fee and return $75 to them. I've never heard of this before, but I haven't worked with many management companies. Is this common?" "Do I need to make a statement in the appraisal report that I have paid $75 to the AMC?" "Are there any other USPAP or legal concerns that I should consider to cover myself?"
Appraiser Question:I got a call today from a mortgage broker in Chicago. She asked, "What's your fee for an appraisal in Danvers, IL?" I told her. Then she asked, "How you you feel about charging an extra $100 so that I could make a little something-something on the deal?"
Here are some appraiser responses to the first question:
- Appraiser: "I have a company that I do work for and they charge $50 per appraisal. I have no problem with this, I charge the customer my fee, provide an invoice for the entire fee and pay the company for each appraisal that they assign to me. Am I doing something that is illegal? Would this be considered a kickback?"
- Appraiser:"At least two of the AMCs I work with inflate the quoted fees to the borrower and take their piece back when collected. It happens to be $50 in each case. I have no objection as long as I collect the fee before I pay them their end. "
- Appraiser:"In my opinion the $50 is for a service performed by the entity acting as the AMC and is not violating RESPA. They have to do some administrative work at the least and make a panel selection to the referred appraiser."
That was just a few of the responses to a debate on how to handle additional fee requests from lenders, brokers, and appraisal management companies.
I'd welcome YOUR thoughts on this topic before I blog MY opinions later today.
Author: Brian J. Davis, RAA - Brian Davis & Associates - Brian has over 23 years of appraisal experience in Central, IL and hosts the Appraisal Scoop blog and the WinTOTAL Users Group an email forum for appraisers.