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Compliance amp Best Practices for Vendor Selection Kristin LaPlante National Account Executive May 14 2014 Oldie but goodie Agenda Inhouse vs AMC management ThirdParty Oversight Best Practices in Selecting a Vendor ID: 775603 Download Presentation

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Slide1

Appraisal Management & Appraisals:Compliance & Best Practices for Vendor Selection

Kristin LaPlanteNational Account Executive

May 14, 2014

Slide2

Oldie but goodie . . .

Slide3

Agenda

In-house vs. AMC management

Third-Party Oversight

Best Practices in Selecting a Vendor

Appraiser Independence

Recruitment

Engagement

Summary

Slide4

In-House Management vs. AMC?

Slide5

Best Practices for In-House Appraisal Management

Defined, written policies

Quality control

Internal audit

Internal appraisal and audit system

Monitoring of C&R fees

Audit trail for every file

Staff member dedicated to compliance

Absolute independence

Keep staff separate from loan production

Slide6

Third-Party Oversight

Lender

is responsible for actions of their third-party relationships and will not be absolved from responsibility

Banks/non-banks expected to vet and monitor

third-party vendors

“You cannot outsource responsibility”

Slide7

Best Practices for AMC Selection & Vetting

1

.

Check referrals and experience

Have they been endorsed by other industry leaders?

Is the AMC handling significant volume?

How long have they been handling appraisal management?

Is their focus purely appraisal management?

Demand Performance Reporting

Third party oversight requires that you have the ability to monitor and report on performance of all vendors.

Access to performance stats such as quality, turn time, etc is mandatory.

Slide8

3. Payment to appraisersDo they pay on time? Ask for fee sheets by stateInterview local appraisers How often does the AMC review C&R fees?Consider a site visitIntegration ExplorationIs AMC integrated with your LOS?Do they have the ability to assist you with UCDP uploading?What type of system does the AMC have for ordering?Ability to make quick changes?Is system easy to use and understand?

Best Practices for

AMC Selection & Vetting

Slide9

Best Practices for AMC Selection & Vetting

6. The AMC team

Are they readily accessible?

Dedicated account coordinator or customer relations manager?

Do they provide you with real-time updates and status?

Strong management team to oversee production and compliance?

Who is the management team?

What is their background?

Is the AMC truly National?

How

are they managing state to state requirements?

What

is their process

for

keeping up on those regulations?

Do they contract

out to larger AMCs to fill

voids

in certain states?

Slide10

Best Practices for AMC Selection & Vetting

8. Compliance Processes

Is staff trained on regulatory and compliance issues?

How often are they trained?

Is the staff USPAP certified?

What procedures are in place to ensure policies are being followed?

What

does their appraisal service agreement look like?

What

is

SOP

for terminating an appraiser

relationship?

Does

the AMC have a dedicated compliance team?

Is

there a

documented disaster recovery plan?

Slide11

Best Practices for AMC Selection & Vetting

Financial Stability

Do they have working capital to support their business?

Do they have a large accounts payable balance?

Do they pay their appraisers in less than 30 days?

Quality Control

Does

the AMC have a dedicated QC department?

What

is their background?

What

procedures are in place

re: Fannie

Mae warnings from

UCDP?

What

is the process when warnings or hard stops are given?

Is

there a formal process in place for value

rebuttal?

What

is the process?

Does

the process follow AIR?

Slide12

Appraiser Recruitment for AIR Compliance

Current licenseVerify with government/state websitesRegularly monitorExperience informationGeographic competencyE&O insurance

Slide13

Appraiser Engagement for AIR Compliance

Written engagement letter

Assignment should be based on:

Experience

Property Type

Scope of Work

Required certification

Geographic competency

Availability

Independence compromised when:

Borrower recommends an appraiser

Production staff selects a person to perform an appraisal for a specific transaction

Slide14

Summary

Whether your choice is in house or outsourced:

Clear, written policies and procedures

Person(s) dedicated to compliance

Audit trail for all appraisals

Appraiser Independence

Slide15

Benefits of using an AMC

We are all aware of how important the collateral is to a loan transaction. In today’s ever-changing lending atmosphere, it is so important to have faith in the fact that you have a quality estimate of value; one that is in compliance with all federal and state regulations and one that you know you can firmly stand behind in terms of its data, integrity and content. Partnering with the right AMC(s) can help shoulder part of your growing valuation responsibilities.

Slide16

Questions?

Kristin

LaPlante

National Account

Executive

Michael Dresden

Executive Vice President

Slide17

Thank you!

Kristin LaPlante

National

Account Executive

207.590.1339

klaplante@dartappraisal.com

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