Illinois begins Customary and Reasonable Fee Study

Pursuant to Illinois Statute, IDFPR has begun the process of compiling data provided by appraisers regarding appraisal fees.  The study is being conducted by the University of Illinois to establish Customary and Reasonable fees for appraisals of 1 to 4 family properties.  Illinois Law requires AMC’s to comply with the federal Truth and Lending Act which includes C & fees.   The AMC Act contains the following language:

• (f) Appraisal management companies are required to be in compliance with the appraisal independence standards established under Section 129E of the federal Truth in Lending Act, including the requirement that fee appraisers be compensated at a customary and reasonable rate when the appraisal management company is providing services for a consumer credit transaction secured by the principal dwelling of a consumer. To the extent permitted by federal law or regulation, the Department shall formulate rules pertaining to customary and reasonable rates of compensation for fee appraisers. The appraisal management company must certify to the Department that it has policies and procedures in place to be in compliance under the Final Interim Rule of the federal Dodd-Frank Wall Street Reform and Consumer Protection Act.

You will soon be receiving an email from U of I similar to the one below.  I would urge any appraiser who has not provided the state with their email address to email your name and email address to Mary Bates at mary.bates@illinois.gov  if you’d like to participate in this study and also receive future correspondence from the State regarding licensing issues.

This survey excludes fees currently being paid to appraisers from AMC’s.

Hello, 

My name is ­­­­­__________ and I am a student at the University of Illinois at Urbana-Champaign who is a research assistant working on a study related to appraisal fees for a real estate professor (Dr. Roger Cannaday).  Ultimately, I have two questions for you, but first I will give you some more details on the study. 

The federal government is requiring that every state conduct such a study and it is being done for Illinois by the University of Illinois, for the state agency that licenses real estate appraisers (Department of Financial and Professional Regulation).

The state agency has provided us with a list of all licensed real estate appraisers in the State of Illinois and the list includes contact information such as phone number, e-mail address and mailing address.

The stated purpose of the study is to establish a customary and reasonable fee for four types of appraisals related to residential properties that are located in the state of Illinois.  These four types include:  1) single-family appraisals using Fannie Mae Form 1004; 2) small residential property (2 to 4 unit) appraisals using Fannie Mae Form 1025; 3) residential condominium unit appraisals using Fannie Mae Form 1073; and 4) exterior-only inspections of single-family appraisals using Fannie Mae Form 2055.

My first question for you, is:  Can you provide us with an estimate of how many of each of the four types of appraisals you have done over the most recent 12 months for properties located in the state of Illinois (that did not involve an Appraisal Management Company)? for Forms 1004, 1025, 1073 & 2055.

My second question is:  If any of your contact information has changed since you were licensed or renewed your license, please give us your correct information:  phone number and mailing address.

The estimate of a customary and reasonable fee for each type of appraisal will be based on the response to an on-line survey that will be conducted by the university’s Survey Research Lab.

Later, you will receive a postcard reminding you of the on-line survey and asking you to participate.  You will be given the link to the website for completing the survey.

Let me know if you have any questions and thanks in advance for your cooperation.

Thank you,