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Residential Appraisers: Panel Appraisers vs AMC

Though the days of a quid pro quo relationship between lender and appraiser are gone, the firewall in place seems more like a punishment than a safeguard to some consumers.  “If the goal was getting to an objective property value by preventing appraisers from being undermined by their customers, the final rules fell woefully short.”  Even now, there seems to be another sudden concern for overly conservative appraisals.  What changed?

“Ask any veteran loan originator.  The No. 1 reason that transactions fall apart is low-ball appraisals, not tight credit standards.”

That’s why, choosing the right appraiser may greatly improve your chances of securing a new home loan.  But, choosing an appraiser isn’t as a simple as choosing a lender.  How will you know if the lender you’ve chosen is using a panel appraiser or an AMC?  And, if you don’t know the difference, how will you even know to ask?

The difference

Lenders using AMCs for their appraisal orders may be able to sell a "less expensive" process but their low-ball appraisal may prove costlier to your next housing transaction.

Lenders using AMCs for their appraisal orders may be able to sell a “less expensive” process but their low-ball appraisal could actually prove costlier to your next housing transaction.

AMCs or, Appraisal Management Companies, are most often employed by large lenders with high-volume appraisal orders.  Their ability to handle high-volume orders will generally enable the lender to sell a “less expensive” appraisal process to their clients.  The drawbacks, however, include slower turn-times, lack of familiarity and delivery of ultra-conservative valuations.  At best, these drawbacks can create delays for a residential real estate transaction.  At worst, they can kill your deal.

At PrimeLending, we don’t use an AMC to order appraisals.  Instead, we order from “preferred list” of veteran appraisers who are familiar with their local markets.  This eliminates those obstacles that can stall or stymie loan approval.  Our in-house appraisers understand that timeliness, accuracy and competency is our clients’ prime concern.

Is this really a big issue?

There’s been a sudden increase in comments regarding appraisals and valuations.  “In some cases the low appraisals had merely required the restructuring of the loan, in others they killed the deal.”   But, as the so-called trend is being investigated, measuring refinances vs. purchases and the roll out of a new desktop underwriting system.  As of now, the only measurable factor is the glaring differences between an AMC appraiser as opposed to a panel appraiser.

For more on Orange County, CA locals who’ve suffered the hypocrisy of the real estate appraisal process click here.

To count on quick, credible and accurate appraisals, Contact me today!

 

 

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