The Appraisal Institute and the American Society of Farm Managers and Rural Appraisers on Sept. 2 lauded the Federal Housing
Administration’s proposal to allow appraisers to utilize residual techniques — such as cost and income approaches — to
STATES OF MIND
State legislation affecting appraisals during the last quarter
AMC bill fails
Legislation that would have
provided oversight of appraisal
management companies in
Massachusetts failed in late July as a last-minute
amendment to the bill drastically changed the
definition of an AMC — a change that forced propo-
nents of the bill, including the Appraisal Institute’s
Massachusetts and Rhode Island Chapter, to request
it be held for further consideration.
The late amendment to the bill significantly
expanded the definition of an AMC to include
appraisal firms that employ one or more appraisers. The definition in previous versions of the bill
was consistent with one included in the Dodd-Frank Act that limited applicability of registration
and oversight requirements to entities that contracted with 15 or more independent contractor
appraisers in the state, or 25 or more independent
contractors nationally. The revised AMC definition
was deemed unacceptable.
Utah lenders pay
higher fees for
Mortgage lenders are willing
to pay higher fees based on
complexity of an appraisal assignment, but not on
the appraiser’s experience and education; however,
appraisers who have a professional designation are
more likely to be hired, according to a study on custom-
ary and reasonable fees released Aug. 13 by the Utah
Association of Appraisers.
Around 76 percent of lenders said they typically
pay additional or higher fees for appraisals of complex,
unique or very expensive properties. When it came to
appraisal experience and education, 53 percent of the
lenders said appraisers with professional designations
are given deference over undesignated appraisers when
placing an assignment.
Read the complete study at
on appraisal fees
The Virginia Center for Housing
Research and the Virginia
The research was conducted by Virginia Tech
researchers and students during this spring and
summer in response to the Dodd-Frank Act, which
requires lenders to pay appraisers a “customary
and reasonable fee” for residential real estate
appraisal services in their geographic market. The
Dodd-Frank Act also requires that customary and
reasonable fees be calculated without the influ-
ence of assignments ordered by known appraisal
See the complete survey results at www.
analyze market reaction to green and energy-efficiency
improvements in the absence of comparable sales.
The joint AI and ASFMRA comments were submitted in
response to a draft Appraisal Handbook issued by the FHA that
intends to serve as an update to the current Handbook 4140.2
and will aggregate all agency appraisal polices in one place.
Under the draft handbook, appraisers would be required
to analyze and report the local market acceptance of special energy-related building components and equipment,
including solar energy components, high-energy efficiency
housing features and components such as
geothermal systems and wind powered
components. The draft explains that in
the absence of sufficient data to perform a
paired sales analysis, the appraiser must
consider the cost or income approach to
calculate an appropriate adjustment.
Read the joint AI, ASFMRA
letter to the FHA at www.
Appraisal Institute lauds FHA for green valuation proposal