Gov. Corbett signs AMC legislation

February 3, 2012

Appraisal management companies will now be regulated in Pennsylvania, thanks to legislation signed by Gov. Tom Corbett on Thursday.

House Bill 398 (Stevenson) requires appraisal management companies to be registered with the State Board of Certified Real Estate Appraisers. Pennsylvania is the 30th state to pass such legislation.

More appraisal management companies appeared throughout the country, as a result of the Home Valuation Code of Conduct (HVCC). The Home Valuation Code of Conduct originated from a settlement among New York Attorney General Andrew Cuomo, the Federal Housing Finance Agency, Fannie Mae and Freddie Mac. While the HVCC was sunset, the issue of unregulated appraisal management companies remained.

“We believe this legislation is important to protect homebuyers in the Commonwealth,” said PAR President Frank Jacovini. “Research initially showed after the Home Valuation Code of Conduct was enacted, consumers were paying higher fees for appraisals that were frequently inaccurate and misrepresented the value of the property. We also saw closings being delayed as a result.”

The new law will create a level playing field for AMCs and appraisers. Appraisal management companies will now be required to work within the nationally sanctioned Uniform Standards of Professional Appraisal Practice (USPAP).

“Thanks to a collaborative group of all stakeholders providing input into this bill, this new legislation provides protection for consumers and industry participants alike,” according to Michelle Bradley, chair of PAR’s Appraisal Management Company Task Force. “Those who own or operate AMCs will be accountable to industry standards and state regulation.”

The new legislation also:

  • Implements a registration and renewal fee of $1,000
  • Implements a $20,000 bond or letter of credit to secure the faithful performance
  • Requires all appraisal reviews to be conducted by a certified or licensed appraiser
  • Requires AMCs to adopt Uniform Standards of Professional Appraisal Practice (USPAP) record-keeping rules.
About Kim Shindle:
Kim Shindle is the Manager of Media Relations at the Pennsylvania Association of Realtors®. Follow Kim on Twitter.
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4 Responses to Gov. Corbett signs AMC legislation

  1. Retired Appraiser on April 24, 2012 at 1:16 pm

    Where’s the beef? Meaning this: What did you actually do to help homeowners and appraisers? We can clearly see where the state stood to make a killing off of these AMCS (like Kentucky did). LMFAO.

    Force lenders to state the REAL appraisal fee on the HUD-1 and you’ve done something.

    Force AMCs to pay fair fees to appraisers for their work and you’ve done something worthwhile. Those fees were $300 to $350 in 2009 (not $200). With the advent of the 1004MC, UAD, constant requests for addenda, & 6 to 9 comps the fair fee is around $500 today.

    Do something to actually help appraisers and consumers and you can pat yourselves on the back Pennsylvania.

  2. Fred Javer on February 9, 2012 at 1:17 pm

    To everyone who reads my response. Please excuse the misspelling .
    My 2 fingers on the keyboard are not working as fast as my brian.

    Thank you, I am sorry for the misspelled words.

  3. Fred Javer on February 9, 2012 at 1:08 pm

    The ANC should go by the wayside and did the HVCC. The AMC is just another level of the consumer paying for an unnecessary step in the financing process. The lender nor the appraiser have any control. neither party is dealing directly with each other. This is just a bandaid fix. Eliminate the AMCs. I have been an appraiser for over 40 years have never had a problem in direct contract with the lender.

  4. Ryan Achenbach on February 7, 2012 at 9:21 am

    Curious how “the new law will create a level playing field for AMCs and appraisers”? From every sentence of the bill/law that I read, there is nothing that is going to change the fact that AMCs will continue to be an imposed middle man in the appraisal ordering and delivery process. Anything that stops short of allowing myself and other appraisers to market our businesses to clients is far short of a level playing field. There is nothing more frustrating and unfair than to contact a lender and be told “I’m sorry, we HAVE to use an AMC (whether by law or lender requirements)” and your business decision is to get on a “list” and hope for assignments to randomly be assigned to you. Fair competition needs to be introduced back into the industry where the quality of service of an AMC is a deciding factor in how to order an appraisal, not a government requirement. That would be a level playing field.

    This also does not even begin to scratch the surface of the potential corruption in the fact that many of the largest lenders own the “middle man” AMC.

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