BARELY 12 MONTHS AGO, in January 2014, a la mode--the largest appraisal technology vendor--announced its Community Partnerships Program (CPP). It is an outreach effort designed to provide financial, technical, educational and logistical support to appraiser organizations and coalitions at the local, state and national levels.
On its own, that might not rise to the level of news were it not for the fact that its immediate success speaks volumes about the current state of the appraisal industry, and its relationship with the mortgage lending and appraisal management sectors.
CPP's rapid growth, from zero to 23 organizations in just a year, reflects the reality on the ground in the appraisal industry: Appraisers aren't happy, and they're organizing at the grassroots level to do something about it.
Lenders and appraisal management companies (AMCs) should take note of the angst CPP has tapped into, as well as the shifting regulatory landscape it's helping create.
While a la mode's CPP includes a handful of national organizations, it's overwhelmingly comprised of state and local groups--many of which have never gotten much notice at the national level and rarely seek it. Instead, those groups apply their influence where it can be most effective, at the state level.
In virtually every state represented, these organizations have members on the regulatory boards overseeing appraisers. Those same boards often control licensing of appraisal management companies as well. The results are clear: States are fertile ground for appraiser-initiated regulatory change.
Compare that with the federal level, where in the aftermath of the much-hated Home Valuation Code of Conduct (HVCC) and the appraisal provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act, appraisers have seen their voices minimized and their advocacy efforts swept aside by competing interests. Much like the current state of national politics, they've taken their efforts locally--and often contrarily--and have had much better success addressing what they consider to be the pressing issues of the day.
Those issues generally include appraiser pressure (often applied via blacklisting or non-payment for services rendered), fee transparency (burying appraiser fees inside the AMC markup on closing documents, and AMCs barring appraisers from including the original invoice in an appraisal seen by the consumer), and of course payment of "customary and reasonable" fees (as originally...