Even as an established and credible appraisal management company (AMC), over the years, we at Oxford have seen many unique appraisal assignments and have also experienced countless interesting contract revision requests.
We’ve also received a number of requests to provide an additional supporting comp or two, and to address how the subject’s opinion of value that is over/under the indicated Predominant Value of the Neighborhood impacts actual value, too. Additionally, the most common requests for revision are of the super simple variety.
Luckily, those and many other contract revision requests seem to be easily avoidable with just a little more patience by the client in the ordering process and from the Appraiser in their own report production. How? The experts at Oxford are here to break it down for you!
The Importance of AMC Contract Compliance
As all appraisers know, having a report that complies with the Uniform Standards of Professional Appraisal Practice (USPAP), state, and client conditions is essential to every appraiser’s practice. We are the individuals to which the standards directly apply, and we are directly in the cross-hairs for state sanctions if deficiencies are discovered.
The USPAP continue to serve as a practical and accessible checklist of sorts for the necessary steps in developing and communicating a strong, straightforward, and thorough appraisal. If you are unsure you are meeting the minimum requirements that USPAP imposes, we encourage you to scrutinize several of your own reports and use the Standards Rules as a literal checklist to ensure your reports are compliant.
Now – before we delve further into it, let’s take a look at some generic examples of common revision requests that we’ve come across in the AMC world:
Common AMC Contract Revision Requests
- Correct the spelling of the borrower and/or seller’s name. Note: Half of the time, this error was initiated on the customer’s part when they placed the order (the other half is an Appraiser input error). The lesson to be learned here is to SLOW DOWN. That saying of quality before quantity definitely applies here and details an easily-avoidable error
- Add or delete a specific borrower to the appraisal.
Note: This revision request is primarily due to the customer needing to add or remove a co-borrower to/from the transaction.
- Correct the Assessor’s Parcel Number (APN).
Note: Lenders require the APN entered on the appraisal to match exactly what the local Assessor indicates. We see many requests to have the Appraiser add -000 to the APN demonstrated in their report.
- Correct the purchase price and/or reported seller’s concessions.
Note: Customers often request this revision after the appraisal did not support the agreed upon purchase price and the Lender requires the new purchase price and concessions indicated in the report. We also see this one due to Appraisers missing an addendum to the Purchase Agreement or Counter Offer reflecting a different sales price or concession amount.
- Include a copy of the Appraiser’s current license and/or E&O.
Note: This revision request is 100 percent on us Appraisers. It’s imperative that we display credibility when it comes to the crafting of the AMC contract.
Other common revision requests are as follows:
- Not enough support/explanation for adjustments being made
- Missing reconciliation to value comments
- Prior transfers of the subject and comparables are not analyzed by the appraiser
- Zoning not confirmed and/or explained
- No explanation on the highest and best use analysis
- Reference to outdated versions of USPAP
The following are several more “appraisal pitfalls,” along with steps appraisers can take to avoid common revision requests associated with AMC contracts.
Avoiding Common Revision Requests
First and foremost, ensure that you have actual data and analysis that support a good understanding of the inventory and trends in the market (including any seasonal influences); and conduct several market studies when necessary.
Summarize your analysis in your report, so a user understands your market conclusions, and include information that is appropriate and relevant, using text areas for overflow or for cases where there is no related field for the specific data.
If you use a template to start your reports, consider including “section headings” that relate to market analysis, to help ensure you summarize your findings within every report. If you attach charts and graphs, ensure those exhibits are relevant.
In the end, be sure your market narrative, attached exhibits and check-boxes and fields do not contradict one another.
Remember: consistency is key! No one ever gets burned for reading the “instructions,” after all!
The Oxford AMC Process
Throughout the entire AMC contract appraisal process, the experts at Oxford monitor the appraiser the entire time. During that period, our clients and partners will receive automated email updates notifying them of progress. When completed, we will review and certify the appraisal for 100 percent compliance.
We then file and document all relevant materials and make them available online for five years. Our clients and partners can access those documents through login credentials. We operate from a high-availability secure system architecture that is fully customizable for the access and security levels required. Furthermore, our clients also have access to quarterly reports showing client and market/industry data.
Turn your appraisal projects over to our experienced team, and we will deliver a reviewed, certified, and 100 percent-compliant project while working with your staff and local approved appraisers. Our secure online portal is available for ordering 24/7, and we monitor every detail of a process that has been refined over many years.
Less Revisions Equal A Smoother Process
When it comes to the AMC contract process, a balance of care, efficiency, and expertise makes the recipe for contract success. From the beginning, Oxford has been committed to three core principles – expertise, service, and independence – and these principles continue to guide the firm today.
If you’re interested in learning more about our appraisal management process, reach out to us today. We’d love to hear from you!