When the HVCC rules came into effect in mid-2009, appraisers learned quickly that working with Appraisal Management Companies (AMCs) wasn't an option, but a necessity. Although there are many small companies which are still adapting to such regulations, the larger companies were well prepared with their legal contracts and processing software to bring in and maintain thousands of appraisers nationwide. Unfortunately, some of the contracts only benefit the AMC and can be seriously detrimental to the appraiser. This article will explain the major flaws in Appraisal Management Dallas Texas contracts and what you can do to protect yourself.
Since the change, appraisers have seen the rise and fall of a good number of AMCs. However, larger companies that have outlasted their competition have the entire process mapped out so that they have the legal documents, such as contracts and the software that helps to keep track of the hundreds of appraisers across the nation.
Just as with any legally binding contract, there are stipulations to watch out for. These stipulations can include clauses that benefit the appraisal management companies and leave the appraiser holding the financial bag. If an appraiser is aware of these stipulations, he or she can protect him or herself and still use the AMCs as a viable source of income.
One of these stipulations would be the indemnity clause, which holds the AMC harmless if a problem arises with any part of the assessment. This clause makes the appraiser responsible for the problem and financial responsibility for any legal cost suffered by the AMC, as well as any suffered by the appraiser. Many appraisers seeking to offset any legal costs have bought E&O Insurance. This type of insurance is reasonably priced and offers protection for peace of mind. However, E&O Insurance does not cover any form of an indemnity clause.
Other AMCs have appraisers on staff to review the evaluation reports while others have individuals who are not trained appraisers reviewing evaluations for compliance with lender requirements. These activities often add several days between when an appraisal is delivered to the AMC, and when the AMC delivers the report to the lender. Technology Fees- In addition to taking a cut of the fee for an evaluation, many AMCs also change the appraiser a "technology fee" in order to receive an order.
That is when the appraisal management contract comes in. Your E&O insurance is still in place, so you are covered for anything you did. However, now because of the "hold harmless clause, " you now have to cover all legal costs of the AMC as well.
As appraisers are getting wiser regarding the contracts they are signing, some AMCs have made changes to their contracts to make them fairer. Remember that it is mostly the largest AMC's that carry questionable contracts. Huge corporations, such as Wells Fargo or Bank of America that have big corporate lawyers are the ones causing the most damage. There are still hundreds of small AMC's, many that carry a simple one-page contract or none at all, that you can sign up with.
When deciding on a pay scale, AMCs will look at the number of appraisers they have on their "approved list." If it is a larger company, employing thousands of appraisers, the assessment company will not pay much more than about $250 per evaluation. This stems from them knowing if one appraisal does not take a job another one will, for the expected fee.
Since the change, appraisers have seen the rise and fall of a good number of AMCs. However, larger companies that have outlasted their competition have the entire process mapped out so that they have the legal documents, such as contracts and the software that helps to keep track of the hundreds of appraisers across the nation.
Just as with any legally binding contract, there are stipulations to watch out for. These stipulations can include clauses that benefit the appraisal management companies and leave the appraiser holding the financial bag. If an appraiser is aware of these stipulations, he or she can protect him or herself and still use the AMCs as a viable source of income.
One of these stipulations would be the indemnity clause, which holds the AMC harmless if a problem arises with any part of the assessment. This clause makes the appraiser responsible for the problem and financial responsibility for any legal cost suffered by the AMC, as well as any suffered by the appraiser. Many appraisers seeking to offset any legal costs have bought E&O Insurance. This type of insurance is reasonably priced and offers protection for peace of mind. However, E&O Insurance does not cover any form of an indemnity clause.
Other AMCs have appraisers on staff to review the evaluation reports while others have individuals who are not trained appraisers reviewing evaluations for compliance with lender requirements. These activities often add several days between when an appraisal is delivered to the AMC, and when the AMC delivers the report to the lender. Technology Fees- In addition to taking a cut of the fee for an evaluation, many AMCs also change the appraiser a "technology fee" in order to receive an order.
That is when the appraisal management contract comes in. Your E&O insurance is still in place, so you are covered for anything you did. However, now because of the "hold harmless clause, " you now have to cover all legal costs of the AMC as well.
As appraisers are getting wiser regarding the contracts they are signing, some AMCs have made changes to their contracts to make them fairer. Remember that it is mostly the largest AMC's that carry questionable contracts. Huge corporations, such as Wells Fargo or Bank of America that have big corporate lawyers are the ones causing the most damage. There are still hundreds of small AMC's, many that carry a simple one-page contract or none at all, that you can sign up with.
When deciding on a pay scale, AMCs will look at the number of appraisers they have on their "approved list." If it is a larger company, employing thousands of appraisers, the assessment company will not pay much more than about $250 per evaluation. This stems from them knowing if one appraisal does not take a job another one will, for the expected fee.
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