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NAIHP Exposes AMC Tax Evasion / RESPA Violations

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Mortgage Professional America | 12 Feb 2012, 02:07 AM Agree 0
NAIHP recently discovered many Appraisal Management Companies (AMC’s), are operating without authority in most states and have failed to pay state income tax.
  • Donna Corrado | | 12 Feb 2012, 02:32 AM Agree 0
    My quality of work is excellent. No claims;violations and a stong E&O policy. As soon as AMC's flooded the market, I lost all my business and am barely hanging on. They take forever to pay if at all, and they treat us like garbage. They are insulting,threatening and should be put out of business. Another failed policy. We are a profession. We should be treated as educated professionals. That is why thousands of us are leaving the appraisal business. They order from whoever quotes the lowest fee and the fastest turn around time. They are intinidating;rude and basically don't know the business.They cause your reputation with the banks to sour.
  • Marc Savitt | | 12 Feb 2012, 03:37 AM Agree 0
    Donna: NAIHP understands the problem and is working to restore true appraiser independence. On January 26th, we met with CFPB Director Cordray. He understands the problem with AMC's and is working with us to make changes. AMC's are rogue, unregulated and harmful to professionals and consumers.
  • Bill Burnett | | 12 Feb 2012, 05:01 AM Agree 0
    Go back to the way it was prior to HVCC. This is just a new revenue source for the banks and the quality is inferior AND the consumer pays more. Don't fix things with HVCC, get rid of it!
  • Donna Corrado | | 12 Feb 2012, 02:58 PM Agree 0
    Do you know that on the orders we get from the AMC's, it specifically states that we are not to tell the consumer what we are being paid, and if we do,we will be dropped from that AMC list? I call that "sneaky" and "deceptive". The appraiser is being "blackmailed". Another problem is, that our files are being looked over and criticized by so called "REVIEWERS" No one ever states who are these people and what are their credentials? If they disagree with our "opinion of value",our reputations are damaged and we are put on the "DO NOT USE LIST". All the industry needs to keep the appraiser independent is a firewall protection. We don't need babysitters. We are already regulated by DPBR and the ASC and AQB. Retroactive field reviews are the worst. The AMC wants the review done and regardless if we agree with the former appraiser's findings, they want us to point the finger at them so they can show their client, someone is at fault. That is just "sick". They then can submit a bill and get paid.They only care in the end ,to fault the person who carries the E&O policy and satisfy their clients desire to hold someone liable. Are you also aware that we cannot even stand a chance to get orders. Most of these AMC's don't care who completes the file. They are not assigned according to an appraiser's experience and quality,they are Broadcasted to hundreds of appraisers.On the other end, the appraiser purchases software that "Auto Captures" the order before anyone else has a chance to accept it. When I reported this to a big AMC that I have had no order assignments in months and have been with them for 3 years, they said and I quote, "We don't care, as long as the assignment is completed in 48 hours". We also get calls asking what our fee and turn time is on a specific property address but never receive that order because it will definitely go to the lowest bidder. Unless things drastically change,and the appraiser is his own person again with reasonable fees that are now going down,down,down, the industry is finished. Would you advise your son or daughter to take up "Appraising "? Our liability is being abused along with our reputations, With the cost of education,licensing requirements,software licensing,equipment,research, and
    transportation, there is no profit left. We should be able to have clients and be able to compete in a free marketplace. SInce the AMC's have to place their fee on the HUD seperate from that of the appraiser, they have all begun trying hire appraisers on a W-2. That changes nothing but makes it worse. Now the appraiser will have to produce volumes of files for even less money. Enough is Enough!.
  • Cynthia Hamilton | | 12 Feb 2012, 03:33 PM Agree 0
    The only reason why AMCs can be profitable is that they hire appraisers as independent contractors, despite the fact that they exert so much control over the appraiser that the appraisers should properly be classified by the IRS as employees. This means the AMCs would have to pay not only income taxes on behalf of the appraisers, but also social security taxes and local taxes like unemployment and disability. It also means that they would have to follow minimum wage and overtime laws (they often require 24-48 hour turn times, which means overtime to finish assignments). I'd love to find a senator or congress person to take this on and stop this fiasco.
  • Marty Lough | | 12 Feb 2012, 03:50 PM Agree 0
    As a state leading the way in correcting some of the regulatory issues we face, Washington mandated that in spite of what AMC's might dictate, an assigned appraiser must be from and familiar with the area the property is located in. In the beginning, we had people from the Eastern part of our state sent to the West side to determine value in unfamiliar areas. Thus you may have had an appraiser who had done a report on manufactured homes in the Yakima area one day, then sent to report on Lake Washington estates in the Seattle market...apples and oranges..with poor quality work and disproportionate values.
    This has stopped, yet some things have not. Calling for a reinspection twice to determing that a kitchen faucet worked (FT Borrowers paid $135 each time plus the initial $520) while a certified HUD inspector's report was unacceptable because it was against USPAP guidelines. As I understand it, the appraiser was fine with the inspectors information, but the AMC made him revisit the property for all of two minutes to turn the faucet on, and he received $40 of the fee. This AMC is one now under scruitiny nationally for not being licensed in all states where it is doing business. With appraisal fraud up over 50% while consumers foot the bill, it's time this rule was reversed and true professionals be allowed to restore us to good business practices. This is one of many topics to be addressed in the NW Housing Summit 2012
  • Jodie Hawley | | 12 Feb 2012, 04:40 PM Agree 0
    In addition to the previously noted issues, the State regulatory agencies cannot enforce compliance with current state and federal mandates of unlicensed entities. The AMCs who have failed to meet the most basic requirement of simply registering with the appropriate regulatory agency in the states where they conduct business, are therefore "above the law" and answer to no-one.
  • Donna Corrado | | 12 Feb 2012, 06:40 PM Agree 0
    People forget the days when it took an appraiser two weeks to complete an appraisal and you weren't allowed to hassle them. Who wrote the rule "48 hrs" anyway. Assignments are complex today consisting of 27+ page reports not only with USPAP compliance but that they be UAD compliant. I don't get it. We turn the file in to an AMC, in 24-48 hrs and it takes up to 3 weeks in underwriting and 45-90 to get paid. It's all nonsense.
  • Marc Savitt | | 13 Feb 2012, 05:25 PM Agree 0
    Please blackout the name, but send me a sample of those orders. msavitt@naihp.org Thanks
  • Marc Savitt | | 13 Feb 2012, 05:28 PM Agree 0
    Jodie: This isn't about registering with regulatory agencies. This is about registering with the secretary of state as a business. Those that don't are operating without authority.
  • USACorp | | 13 Feb 2012, 09:33 PM Agree 0
    Are there TOO many corporations evading taxes to keep track of and punish?
  • Steve Miller | | 13 Feb 2012, 11:54 PM Agree 0
    I feel like a prostitute working for a pimp that batters and abuses me. This has to end NOW! Sorry, I had to put in a fake name due to the likely blacklisting if an AMC saw my real name. See the control they have over our livelihoods? It's sickening! I think I'd rather work in the meat packing plants prior to unionization. I think I'd rather work in a Chinese sweatshop making shirts for the Kardashian Collection.
  • Jon Adams | | 15 Feb 2012, 10:40 AM Agree 0
    Don't worry, the gubment will fix it. They fix everything.
  • Jon Adams | | 15 Feb 2012, 10:49 AM Agree 0
    I forgot to mention that the appraiser independence regulations have all been for the greater good and every one of us should be willing to sacrifice. After all, didn't Andrew Cuomo make several million dollars when he sold his stake in an AMC?

    What could be more important than that?
  • Bill Smolen | | 15 Feb 2012, 03:23 PM Agree 0
    Any appraiser who stops getting work from an AMC should certainly consider filing for unemployment benefits. It is hard to imagine that the Dept. of Labor, which is more-often-than-not sympathetic to the person filing, is going to look at one of those 100+ page contracts, with all their un-understandable legalese lanaguage, and not conclude that the individual who signs such a contract is not being supervised to a certain extent, and that their fees are not being controlled, and that the person signing had full uderstanding of the document. Let's get some sympathetic lawyers involved. By the way, the way it usually works, once the employer (whether they believe themselves to be one or not) loses, some time soon after the IRS comes a-calling. Lose one and you have lost them all, even if they are still doing work for you. Have any appraisers tested these waters yet?
  • Concerned Appraiser | | 16 Feb 2012, 08:28 AM Agree 0
    Speaking of Andrew Cuomo, I'm curious what contributions he has received from various PACs that represent the interest of AMC's or Associations like TAVMA. I'd be interested to know what political contributions are being dispersed and who is receiving them.
    Also of concern are those management companies that outsource the auctioneer to overseas companies or call centers. Communication is next to impossible, due to the lack of their understanding of the English language and our industry.
    Appraisers need their own PAC to fight this battle, and not expect education providers (ie. AI) acting in their self interest to win the war.
  • James Dean | | 17 Feb 2012, 01:12 PM Agree 0
    To Marc Savit, Thank You for all You guys do for us Appraisers. Even Appraisal Institute is a bankers prostitute they just want our $ and do nothing. I feel betrayed . No one spoke up till now lets hope we can expose these thieves and scum. I will join NAIHP as soon as I get paid for my work which was completed over 1.5 moths ago. I recommend for all other Appraisers to join in, this seems to be the only way to deal with this issue and take control of our profession. Nothing, nothing gets done on its own. This profession which supposed to be a backbone and protection has been hijacked by BANKSTERS.
  • Retired Appraiser | | 05 Mar 2012, 05:41 PM Agree 0
    Correction Donna; the appraiser is being "extorted". FNMA & Freddie Mac were the entities that were blackmailed to create this golden goose for banks.
  • Retired Appraiser | | 05 Mar 2012, 05:50 PM Agree 0
    One Question For The Countless Appraisers Who Say You Have Had Enough:

    Why is it that you refuse to organize and strike?
    No union is needed guys so stop using that as your excuse.

    In all honesty I think appraisers deserve everything that has happened to them.
    Why? As a group you couldn't fight your way out of a paper bag. It's pathetic that every appraiser has access to the internet and you can organize with one simple web page (which was actually created last year). Appraisers however prefer to whine and work for half price.

    Yes I was one of you guys for two decades. I managed to sprout a brain however after refusing to participate in extortion.
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