Sound Off

Appraisal Fees: A Reasonable Solution

Dear Henry:

Us 80 year old kids need to share our experience.

I recently received an FHA appraisal assignment on a single family house, from an appraisal management company and when I arrived on the scene I realized that I appraised, also on an FHA refinance, the house directly across the street in 2001. The value of the houses almost doubled in the 10 years in between.

My work to complete the appraisal, with 3 Comp sales (with current non-MLS pictures), 3 listings, interior pictures, market condition forms, etc, also almost doubled. When I pulled up the 2001 file, I found that I had received a fee of $400 for the old 2001 job. My fee for the 2011 appraisal was (drum roll): $400. WOW!

I found that the appraisal fee charged to the home owner was $750. (she offered the information) and asked why my fee which she assumed was the full $750 was so high? I could not find a reasonable answer except: "I'm sorry, I can't discuss it with you..ask your bank."

Reasonable fee solution: Since AMCs are here to stay, even though some states are now (or soon will be) requiring a license, the Feds and/or federal institutions should require the AMCs to pay the Appraiser 75% of whatever fee they charge the homeowner for the appraisal, and be required to show both parties and their fees, on the HUD1. The banks should NOT be allowed to own AMCs. This will stop the AMCs from shopping for the lowest fee and least experienced appraiser to do the job.

Don Betz
Maryland Certified General since 1962