Editor’s Note: Hundreds, possibly thousands of appraisers are left with unpaid invoices as a result of AppraiserLoft shutting its doors; now one major lender is stepping up and paying up. Reprinted with permission from WorkingRE.com
Lender Paying Appraisers Stiffed by AppraiserLoft
By Isaac Peck, Assistant Editor
The argument is unsettled to what degree lenders are responsible for the agents they hire to administrate valuation services- appraisal management companies (AMCs). The case of the AMC AppraiserLoft kicked off the debate when it closed its doors leaving an estimated three million dollars or more in unpaid appraiser fees.
In the meantime, one major lender, Metlife Bank, is saying it will make good on the bad debt created when its agent, AppraiserLoft, shut its doors.
In the wake of the shutdown, Working RE reported that many appraisers believe lenders are responsible under federal law for bad debt left by their agents. (see story in Working RE AMC Bad Debt-Lenders Responsible?)
A follow-up story reported some appraisers actively pursuing the banks that hired AppraiserLoft in an effort to recover their lost fees.
Now, a major lender, MetLife Bank, is stepping up to pay appraisers for unpaid work completed for AppraiserLoft. Specifically, any appraiser who completed work for AppraiserLoft on behalf of MetLife and was left with an unpaid invoice can contact MetLife Bank for the fees that they earned but were not paid for.
Sue Potteiger, Chief Appraiser at MetLife Bank, told Working RE, “We’re doing this because we made the decision to work with AppraiserLoft. We did our due diligence on this vendor and engaged them to provide appraisal reports to mortgage brokers that we directed to them.”
According to Potteiger, “It’s not the appraiser’s fault that AppraiserLoft didn’t pay them. If an appraiser did the work and we made a decision based on the appraisal provided – the appraiser should be paid. We did pay AppraiserLoft all monies we were billed for. We are paying the appraisers the money they would have been paid. These same appraisers are vendors that we might be working directly with on our fee panel. It’s important to us to maintain an open and respectful relationship with our appraisers,” Potteiger said.
Potteiger explained that MetLife’s stance is a product of “a pretty straight forward philosophy – treat people with respect and keep your word.”
If you are an appraiser who did work for AppraiserLoft on behalf of MetLife, you can contact MetLife Bank to recover your unpaid fees through March 30, 2012. Provide them with a copy of your engagement letter, an invoice or record of your payment relationship, and any other documentation you have that shows you did work on behalf of MetLife, such as copies of the appraisal reports, emails between you and the broker, and any other communication that shows the client was MetLife. Send inquiries to email@example.com.
How other lenders handle this issue, only time will tell.