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
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Slide1
Appraisal Management & Appraisals:Compliance & Best Practices for Vendor Selection
Kristin LaPlanteNational Account Executive
May 14, 2014
Slide2Oldie but goodie . . .
Slide3Agenda
In-house vs. AMC management
Third-Party Oversight
Best Practices in Selecting a Vendor
Appraiser Independence
Recruitment
Engagement
Summary
Slide4In-House Management vs. AMC?
Slide5Best 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
Slide6Third-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”
Slide7Best 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.
Slide83. 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
Slide9Best 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?
Slide10Best 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?
Slide11Best 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?
Slide12Appraiser Recruitment for AIR Compliance
Current licenseVerify with government/state websitesRegularly monitorExperience informationGeographic competencyE&O insurance
Slide13Appraiser 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
Slide14Summary
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
Slide15Benefits 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.
Slide16Questions?
Kristin
LaPlante
National Account
Executive
Michael Dresden
Executive Vice President
Slide17Thank you!
Kristin LaPlante
National
Account Executive
207.590.1339
klaplante@dartappraisal.com