Appraisal Management Companies (AMC) have existed since the 1960s and grew in prominence following the global economic downturn in 2008. Post Dodd-Frank (2010), AMCs have played an increasingly important role as third-party service providers in the consumer mortgage process.
AMCs are hired by lenders and/or other financial institutions in a consumer protection role, per Dodd-Frank, to manage an independent and compliant process to determine the price and/or value of a residential real estate. They manage the ordering, tracking, quality control and delivery of valuation reports.
In addition to appraisals, AMCs offer many valuation products and services to lenders and secondary market investors. They are required to maintain strict adherence to federal and state regulation and law in accordance with Dodd-Frank, the Truth in Lending Act and federal Interagency Guidelines.
AMCs support a smooth, timely and responsive mortgage process for consumers and lenders by working with certified appraisers and other real estate professionals across the nation. Among the vital consumer protection role and essential valuation-related functions AMCs fulfill:
- Maintain a qualified panel of licensed appraisers ready to execute lender valuation assignments.
- Ensure appraiser independence by safeguarding against fraud and undue influence in the valuation process.
- Comply with federal and state laws governing valuation products and services.
- Protect public safety via background checks of appraisers before they can be employed or empaneled.
- Provide quality control to ensure the integrity of a supportable, dependable and credible appraisal.
- Help to lower costs associated with borrowing by providing lenders with efficient and cost-effective services.
- Assist state appraiser oversight by mandatory reporting on appraiser violations of the USPAP.
- Investigate appraiser concerns regarding undue influence and consumer complaints regarding conduct.