At home with America's fastest-growing AMC

Appraisal Nation's popularity is due to diversity and breadth

At home with America's fastest-growing AMC

If your buyer wants to buy a property, then you’re going to need an appraisal. Whether the appraisal is for a classic residential mortgage or an as alternative valuation type of products for residential and commercial property, Appraisal Nation is a one-stop shop.

And talk about growing pains: for the past three years, the independently-held AMC has made Inc. 5000’s list of fastest-growing companies in America, with more than triple-digit revenue growth and adding staff to connect more than 400 lending clients and thousands of regional mortgage brokers with its network of more than 20,000 appraisers in all 3,100 counties in all 50 states.

John Tedesco, senior vice president, business development, said that diversity and breadth in both geography and product is why people are flocking to Appraisal Nation.

“We’re doing not only your classic Fannie, Freddie, residential stuff, but we’re the number one provider in the country of valuation insurers to the capital mortgage, private mortgage, hard money institutions, across the country. So people who are investing in fix and flips, reno, portfolio investments, etcetera, we are doing the heavy valuations on those properties as well.”

Requirements of these types of loans sometimes differ from one another, but since Appraisal Nation has a full suite of appraisal products, commercial products, BPOs, AVMs, and customized review products, there are cross-benefits to all partners. Conventional mortgages, for example, tend to move much faster than investor mortgages. Not at Appraisal Nation.

“These loans are closing in 10-14 days, you have these things moving quick, and we have the fastest turn times in the country, so that’s why all these people are turning to us. Now, the benefit of that is, it trickles over to our conventional business. So if you’re working with us from a conventional bank or you’re working with us from a credit union or a community wholesale lender, you’re going to end up getting those fast turn times and that unique customization that those private capital market investors have become used to as opposed to a classic institutional AMC that’s going to drag their feet,” Tedesco said.

Michael Tedesco founded the company in 2007 having a particularly relevant insight due to his background as a lender. He worked for one of the largest loan servicers in the country, and he noticed that if you were working with the A-paper loans from the largest lenders, you’d get A-type service; customizable solutions from high-end professionals. If you were a small- to mid-size community lender, you got less experienced workers who would just follow the process sheets on their policy requirements. For Tedesco, that wasn’t good enough.

“So Mike said, I think I can build one of these AMCs with the mindset of that big five service for all the small- to mid-size lenders in America. And this was prior to the market collapsing in ’07-’08, before HB16 and Dodd Frank, and all these changes came into the industry, so really we got ahead of the curve,” John Tedesco said. “Seeing his vision to take this further really allowed us to set the pieces in motion to make it very customizable and attentive to even the smallest of lenders around the country, which made us a good solution for alternative lending institutions.”

Appraisals may not be that exciting on paper (let’s face it, neither is most of origination), but there are quite a few aspects of the business that gets Tedesco fired up. One of these is the way Appraisal Nation has chosen to incorporate technology into their business practice.

“We’re not letting the relationships deteriorate because of technology; we’re actually using that to help flourish the relationship,” he said. They recently created appraisal 360 products that include drone footage and 3-D Matterport cameras, or dollhouse imaging.

“In the classic appraisal where you’d see that PDF and it shows the plat map with interior pictures, in our 360 appraisal you can actually click on that plat map and it’ll bring you to drone footage around the area so you can look for yourself. Or you can click on that photo of an interior room and it can bring you right into a dollhouse image where you can actually turn around, look around, see the other four walls in the room as well. We’re doing some cool stuff so we’re excited about it.”

These tools are also integrated with the majority of LOSs, so with a few clicks, a file can be sent to Appraisal Nation.

The appraisal pool is shrinking due to appraisers aging out of the business without anyone taking their place. One solution is through hybrid products, in which Appraisal Nation can use their extensive network of home inspectors to go into the field, take photos and do checklists, and send that material back to the appraiser, who can then use those, along with other smart tools and algorithms to complete the report from their desk. This allows experienced appraisers to make the most of their time and do more reports per day.

While these types of hybrid products were typically used for HELOC loans or for portfolio lending under certain thresholds, Tedesco said, they weren’t historically used for conventional lending. He thinks that may change.

“Last year, Fannie and Freddie approved some of those type of alternative type products to be accepted on conventional loans under a certain threshold,” he said. “I think what you’re going to see is that as that does well in the next year or two, they get comfortable with it . . . it’s still being FIRREA compliant, signed off by an appraiser, it’s still working for meeting the needs while speeding up the process for the lending industry across America,’ they’re going to then reevaluate their threshold.”