The membership of the Wexford, Pennsylvania-based Title/Appraisal Vendor Management Association (TAVMA) has developed Standards of Good Practice in Appraisal Management, the association announced Wednesday. These standards outline best practices to help ensure that appraisal management companies (AMCs) and appraisers deliver quality, objective valuations to financial institutions.

When developing the standards, the needs of all stakeholders, federal interagency guidance, the new Home Valuation Code of Conduct (HVCC), and other federal and state statues were taken into consideration. The standards attempt to codify long-time industry practices on a variety of issues, including local market knowledge and competency, distance appraisers travel, appraiser selection and communications, and dispute resolution.

“There has been a great deal of distortion in the press and on the Internet about the role of AMCs, the qualifications of the appraisers they work with, appraiser travel policies, and the value that AMCs bring to the lending process,” said Jeff Schurman, executive director of TAVMA.

Schurman said many of these stories are based on anecdotal complaints by third parties who don’t regularly work with these companies. He said AMCs are currently involved in over 60 percent of all residential transactions,

and over two-thirds of all licensed and certified residential appraisers work with AMCs. In addition, Schurman said preliminary results of a member survey suggest that the average AMC appraiser has 13-16 years experience.

Developed over the past year with input from TAVMA members, lending institutions and appraisers, the standards address nine key areas including:

• Supplier recruitment and coordination
• Appraisal order assignment
• Order tracking and workflow management
• Pre- and post-delivery quality control
• Appraisal delivery
• Customer service, dispute resolution, and client pressure
• Product and technology development and utilization
• Sales, marketing and administration
• Training and development

Schurman said these standards were draw from the best practices of reputable AMCs and reinforce the benefits AMCs bring to the market, including appraiser independence, quality control, and transparency that increase lender and consumer confidence, and efficiency and logistics that support national lending. The purpose of these new standards is to provide a roadmap that reputable AMCs can follow to deliver quality appraisals and to attract highly qualified appraisers.

“As the real estate and mortgage industries emerge from its current downturn, it is vital that AMCs continue to focus on processes, systems, and controls to ensure that they continue to deliver high quality, objective valuations,” Schurman explained. “Like any industry, AMCs must continually update their standards to be responsive to the needs of customers and suppliers. These standards allow the industry to put some parameters around what it means to be a professional, objective, and successful AMC.”