Accelerate Your Mortgage Process With Improved Appraisal Management

by Jerome Jelinek, CEO and President.

December 17, 2023

Effective appraisal management is crucial for mortgage lenders looking to optimize and accelerate their mortgage processes. By streamlining appraisal workflows and focusing on technology-driven solutions, lenders can ensure borrower satisfaction, faster turnaround times, improved accuracy, and compliance with industry regulations.

Collaborating with an appraisal management company can provide access to a network of experienced appraisers, ensuring compliance with industry regulations and guidelines. These companies have expertise in managing appraisal operations, ensuring accurate records, and timely delivery of appraisal reports. They also offer appraisal management solutions that streamline the appraisal process, eliminate bottlenecks, and reduce wait times.

Key tips for successful appraisal management

Consistently low turn-times and accurate valuations are the goals of successful appraisal management. In the current market, average turn times should be well under 7 days. Additionally, by implementing stringent quality control measures, lenders should expect appraiser error on less than 5% of returned appraisals. The keys to producing these results are combining a comprehensive, data driven appraiser assignment process with a robust quality control process.

Assignment of Appraisal Request to Next Best Appraiser

Traditional appraisal management methods often rely on a round-robin approach, where the assignment is randomly allocated to the next appraiser on the list. However, this can lead to inconsistencies in turn-times and appraisal quality. Instead, look for a professional appraisal management company (AMC) like CSS that uses technology-driven platforms to intelligently assign appraisals based on appraiser past performance, workload, responsiveness, and proximity to the property. This approach ensures that the right appraiser is assigned to each appraisal, increasing efficiency and accuracy. Here is a breakdown of how this process unfolds:
  1. Gathering Appraiser Data:

    To make an informed assignment decision, the AMC must gather and utilize detailed information about each available appraiser. This includes factors such as their proximity to the subject property, geographic competency, quality scores on past appraisals, responsiveness and ease of working with appraisers on previous assignments, current workload, vacation schedule, and verification of licensing and errors & omissions insurance coverage.

  2. Technology-Driven Evaluation:

    Your AMC should be using current advanced appraisal management software platforms. These platforms consolidate and analyze the extensive appraiser data to identify the next best appraiser for each assignment.

  3. Ensuring Timely Reports:

    Once the next best appraiser is identified, your AMC should be regularly communicating with the assigned appraiser to ensure each step of the appraisal is completed timely. Utilizing a variety of communication methods such as emails, texts, and the use of mobile apps simplifies communication for the appraiser.

Effective Quality Control Process

Once the completed report is received back from the appraiser, implementing an effective quality control (QC) process is crucial to the appraisal outcome. AMCs that utilize customizable QC rules and employ both automated and manual checks, produce the best results.

Automated Review, Evaluation, and Scoring

The first key component of a high-performing quality control process is implementing an automated review of the completed report. This review quickly identifies and confirms thousands of data points within the appraisal. Inaccurate or missing data is flagged and returned to the appraiser for correction and submission. This step ensures that all data in the appraisal report is accurate, consistent, and in compliance with industry standards.

Utilizing automated algorithms, your AMC will evaluate and score different areas of the appraisal report. This evaluation provides a comprehensive written report that is available to both the lender customer and the AMC QC review team. It allows for a thorough analysis of the report’s completeness, accuracy, and compliance with industry standards.

Automated Quality Report

Once the appraisal has cleared the first tier of automated review, a sound practice is to submit the appraisal to a second tier of automated review. In this step, a more comprehensive review of the strength of the appraisal is checked and documented. A detailed report highlighting strengths and areas of concern is prepared. This report is utilized by the manual review team to target their review to areas of highest concern reducing overall review times.

Manual Review by Qualified Team Member

After completing two tiers of automated review, each appraisal should then undergo a thorough manual review by well-trained appraisal review staff. This team conducts a detailed analysis of each appraisal, verifying its adherence to appraisal guidelines and standards. Any inconsistencies or potential issues are identified and addressed during this review prior to the appraisal being returned to the lender.

Appraisal Compliance Checklist

An Appraisal Compliance Checklist is an important part of reducing appraisal revision rates. Utilization of the checklist ensures each review step is completed on each appraisal. Your AMC’s checklist should outline the key requirements and guidelines that need to be met to ensure compliance with regulations and minimize risk. 

Panel Management

You may have concerns about maintaining the strong relationships you have established with your appraisers over the years. With an AMC like CSS, you can still utilize your authorized panel of appraisers instead of relying solely on our pre-existing pool. This means that you can continue working with appraisers you trust while benefiting from comprehensive appraisal management services.

Final Thoughts

By incorporating an AMC into your appraisal management process, you can significantly improve process efficiency. There is peace of mind with an AMC, knowing that your appraisals are on track.

If you haven’t worked with an appraisal management company, now is the time. A trusted partner can relieve your team of administration burden while reducing appraisal turn times. You can increase quality, accuracy, and timeliness while unlocking modern tools and best practices.

If you’re working with an AMC, but don’t see them using these tools and best practices, maybe it’s time to look around. We’d be happy to show you how we can enhance your current appraisal management practices.

Learn more about CSS Appraisal Management to accelerate your mortgage process today.

Jerome was the founder of CSS in 1992, and has been its CEO and General Counsel since that time.
Prior to CSS, Jerome was in private practice in southeastern Michigan, concentrating in real estate law and commercial litigation.
Corporate Settlement Solutions (CSS) is a single-source provider of real estate title, closing, valuation, flood, and recording solutions.

Our team is highly engaged in delivering results that make our customers more efficient, effective, and profitable.

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