Why no increase in compensation for an increase in FHA requirements?

With the release of FHA mortgage letter 4000.1 and its 400 pages where it states 2,600 + times what an appraiser MUST do, why NO increase in pay to the appraiser? With increased liability, scope creep, inspection time, expected knowledge, and significant overall time to complete a single assignment, its a BIG issue (30% longer). If starting tomorrow the lender was going to have a 30% reduction in its profits, would the shareholders be okay with this? Then why is it okay to have the appraisers FHA business overnight be 30% less profitable?

That's a question to take up with your AMC Bill! As a lender, I have seen increases to the prices AMC's are charging my borrowers, but I'm not privy to what the actual appraisers are getting paid out of that.

I think it's a shame that we need to have middlemen cutting into what you guys get paid, but it's the way the business is now I guess. Bad apples ruined it for you guys just like it did for lenders!

- Tonytheloanguy - Oct 6, 2015 at 4:38PM

@tony.grech1 Thanks for the information. My 5 biggest clients (small sample)have left the FHA split to the appraiser the same even after the new regulations. As it relates to setting appraisal fees, the lender is 100% responsible as the AMC only collects a portion (split)of the stated fee on the HUD-1. In an effort for the lender to have the best deal (lowest cost), I am of the opinion they see no advantage in offering higher fees (split) to the appraiser.

- Bill J. - Oct 6, 2015 at 5:28PM
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