The Mortgage Industry’s Current State: A Call for Change

Appraisal management needs a paradigm shift.

The economy, regulators, and technological advances demand it.

Interest rates remain high, and that means mortgage applications remain low. Yet as revenue from loans is decreasing, regulatory scrutiny is increasing. The bottom line? Whether it’s a renewed focus on Appraiser Independence Requirements (AIR) or a new focus on bias in appraisals and AVMs, the cost of compliance is going up.

So how can lenders ensure they have cost-effective, reliable, and compliant appraisal management?

First, a common misconception needs to be dispelled – that in-house valuation management is cost-effective. When calculating the per-order cost, even if the direct staffing costs are accounted for, what’s almost always left out are things like the need for ongoing training, software licenses, and staying current on regulatory changes.

Moreover, in-house appraisal management isn’t scalable, meaning lenders don’t have the ability to quickly adapt to market fluctuations. This leads to overstaffing during slow periods and frantic hiring scrambles to meet demand during busy times. Either scenario is financially and emotionally draining.

So the short answer is “work with an AMC.”

But simply deciding to work with an AMC isn’t the full solution. The one-size-fits-all approach of many firms is not only ineffective but also fraught with risks. What’s needed is a paradigm shift towards a more nuanced and effective approach that takes advantage of technology to align with both the industry’s evolving demands and individual lenders’ needs, while keeping the end user – the borrower – happy.

In short, what’s needed is intelligent valuation management that makes every valuation personal. Behind every order, every loan, is a person or a family with unique needs and aspirations. When that’s the focus, technology is sought out or developed to make reliability and quality control integral parts of the process.

In a world where most AMCs treat orders as mere numbers, the value of personalized service cannot be overstated. When you call, you need someone to answer. When you have a valuation need, you want it handled with precision and care.

For lenders, the choice is clear: personalized, intelligent valuation management is not just an option; it’s an imperative. And you need a partner that’s big enough to get the job done, but small enough to get it done right.

That’s the future of valuation management. That’s EVP.

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The Mortgage Industry’s Current State: A Call for Change

Appraisal management needs a paradigm shift.