“I have let all my lenders know I will not deal with them if I have to use an appraisal ordering system, (and) I have managed to get exemptions from four lenders that insist on [using them],” broker Curtis Glenn wrote on MortgageBrokerNews.ca. “I have told the lenders I will go somewhere else with the file. I after 21 years as a broker if they do not trust me then I won’t use them. If every broker said no, [these appraisal companies] will go away.”
It’s a tactic that may only work for seasoned, high-efficiency brokers but one more industry players are likely to try as frustration with appraisal dispatch companies grows.
Several brokers have complained about delays and unexplained extra costs when dealing with these companies.
“Up-charging of fees is a big issue,” commenter Michael Rice wrote on MBN. “Insist the [lenders] enter into a one fee for all deals. It eliminates the nickel and diming effect from the appraisal companies.”
The suggestion comes in response to a story about the dwindling number of lenders who allow brokers to select appraisers for deals. Most are now using middleman companies accused of farming out contracts to those appraisers coming in with the lowest bids.
It’s a process that has long frustrated brokers as well as appraisers, who feel their business is being degraded.
“What really they are is a glorified call centre and they swear to the bank that they’re going to send the appraisal to the best fit per job based on approved lists … what they really do is they send it out to the [lowest bidder],” Derek Dupuis, an appraiser with S. Rayner and Associates, told MortgageBrokerNews.ca Tuesday. “They send it out to the appraisal companies that they have managed to sign contracts with for low, low rates. Like rates that we charged in 1992.”
Brokers frustrated by appraisal management companies may want to take a page out of one professional’s playbook for dealing with lender demands.