Today I finally received payment on an appraisal delivered in March, almost six months to the day. The appraisal was prepared for (and contracted by) a major financial institution. There was no problem with the appraisal. It was well prepared (if I do say so myself!) and there were no questions or issues during the review.
We called no less than a dozen times to follow up on the payment status; first we were told that they’d “look into it.” Then we were told, “don’t worry, you’ll get paid” and “you know we’re good for it.” The reason for the delay, we learned, is that the loan hadn’t closed and the Bank’s policy is to pay for all third party costs at closing; they do not collect the appraisal fee from the borrower up front.
This policy is wrong on so many levels:
* The Bank should not expect their appraiser to subsidize their borrower for six months
* While I know that the Bank “is good for it”, our landlord and phone company still expect their payment on time.
Ironically, in this instance, the appraisal was a 2-week rush assignment, where we worked through two weekends to get completed on time.
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To say that this policy is wrong is an understatement. Unfortunately, there is almost nothing one can do but leep after these companies until they do pay or become independant enough to take them off your list!
Same goes for the “termite” inspector. We are expected to wait until closing for payment. And if it doesn’t close the response is “i refer a lot of work your way….either wipe it off your books or I’ll use someone else. Too many times banks/realtors etc., have proved to be NOT good for it and dare you to force payment on them.
My appraisal fee was collected by the lender at the time of the loan app…$300.00. Imagine how I felt when I learned the lender had not paid the appraiser. I wanted to switch lenders after the appraisal and when I asked for MY appraisal documents I was told “no” by the lender. Excuse me but I DID pay for it so hand it over. Finally I found out the appraisal co, name and called them directly. That’s when I found out the lender had never paid for it….not only that but the actual fee was only $250.00. The lender cleared $50.00 profit on each appraisal. I paid the appraisal company the $250.00 to release my report to me and went back on the lender like hurricane Katrina. Needless to say I got my $300.00 back.
Too many expenses are deferred for the benefit of the buyer…..if a buyer can’t afford an appraisal or a termite inspection then they have no business buying a house.
PCOinOhio – your quote is so profound “Too many expenses are deferred for the benefit of the buyer..if a buyer can’t afford an appraisal or a termite inspection then they have no business buying a house.” I find it amazing how many mortgage brokers call us up to do appraisals whom we have never done business with before, who expect us to get paid when the loan closes. We require payment up front. If thats a problem, then you can be sure there will be problems down the road.
the new forms require more work and mls in every county and crawling under floors and doing roof inspections and most still require a cost approach. We appriasers are our own worst enemies. i started appraiseing in 1985 and fees were $250. Now 20 yrs later there are Appraisers working for less. surveys have more than doubled
and no real appraiser should accept a fee of less than $300