Appraisal/Evaluation management is when an individual or group employs Licensed, Certified and General appraisers to fulfill real estate appraisal assignments, and qualified real estate professionals to fulfill evaluation assignments, on behalf of the mortgage lender. It involves recruiting, qualifying, verifying licensure and other requirements, negotiating fee and service level expectations; administrative duties like order entry and assignment, tracking and status reports, pre-delivery quality control (USPAP and Appraisal Standards), and report delivery (generally electronic). In addition, it involves ongoing quality control (a new major focus of federal regulators), accounts payable and receivable, market value dispute resolution, and record retention. It's much more than 'order in' and 'order out'.
Appraisal Management Focus
- Order Management
- Appraisal Review, USPAP
- Record Keeping/Accounting
LOWERED NON-INTEREST EXPENSE (SAVING MONEY)
Meeting Federal requirements is the primary reason community banks start considering an appraisal management company, but a second and ever more important reason is that the community bank or credit union saves money on every transaction. Community lenders cannot compete with the efficiencies that an appraisal management company offers as the local lender's non-interest expense (labor) grows higher. There are even AMCs that specialize in working with local banks and credit unions. Appraisal management is not the lenders focus. Have I mentioned that the community bank does not pay for appraisal management if it’s outsourced? That cost is passed onto the consumer at the closing. But it does come off the lenders bottom line if in-housed!
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