Lenders, AMCs and Technology: What’s the Ideal Approach?
As the regulatory environment intensifies and further scrutiny is placed on lenders to process appraisals in a compliant manner, now more than ever, it is critical that lenders utilize an organization and model that cost effectively gets the job done right—every time. Most lenders elect to use appraisal management companies (AMCs) to outsource and handle the appraisal process for them. While this is an effective method, there are a number of different challenges that accompany working with multiple AMCs in order to efficiently and compliantly manage the appraisal process. These challenges can cost them time, money, cause reporting issues and create potential compliance exposure. Most every AMC uses some form of technology to help manage the appraisal process and make it easier for lenders to do business with them. However, each AMC may use a different technology system that the lender’s staff must learn for managing different processes such as how to order, receive status updates, workflows, reporting and more. Further complicating matters is that using multiple AMCs that have different technologies makes it difficult to efficiently assign and place orders with appraisers due to systems that do not talk to one another. And then you have to make sense of multiple reports from multiple AMCs’ systems. So, you can easily find yourself bouncing around to different applications, re-logging in, learning different systems and features, and sorting out what ultimately becomes a messy, time consuming reporting structure. This can get so complex and laborious that it becomes counterproductive. The good news is that there are solutions available to remedy the aforementioned issues. The optimal solution is to implement a centralized appraisal order management and distribution system that consolidates and streamlines the eight primary aspects of the appraisal management process: Vendor Management, Ordering, Assigning, Tracking, Delivery, Reviewing, Selling and Accounting. Using a centralized, all-in-one platform eliminates errors, thus preventing kick-backs, and it ensures 100 percent compliance with detailed reporting. By using a centralized appraisal management distribution system, you are able to effectively streamline and manage all steps in the process. Users will only be required to learn a single system for every appraisal order, thus creating a more simplified and efficient process for LOs, processors, appraisal coordinators, and review/underwriting staff. This will save significant amounts of time, reduces errors and speed up the entire appraisal process. There a quite a few commercially available appraisal management systems that mortgage technology vendors offer. What is key to look for when selecting a vendor is to evaluate how well they handle the eight key components of the appraisal management process. And the platform must absolutely have a standardized, easy method to integrate with the AMCs you use in order to share and manage data, complete tasks, and deliver reports. The platform should also integrate tightly with your loan origination system (LOS). If you implement a centralized appraisal management system that integrates with your AMCs’ different systems and also your LOS, then all of the applications are able to talk to one another, thus bringing newfound efficiencies and transparency to your appraisal process, thus eliminating the problems associated with using multiple AMCs. The bottom line is that while AMCs have developed technology for their lender clients to use, if those systems cannot interface with a central, all-in-one appraisal management platform, then you are going to have challenges. Vladimir Bien-Aime’ is president and chief executive officer of Global DMS. Since co-founding Global DMS in 1999, Bien-Aime’ has grown the company to capture a leading share of the appraisal management segment, with a client base of over 20,000 unique users and a 100 percent retention rate among lender clients. He may be reached by phone at (877) 866-2747 or visit www.globaldms.com.