Appraisal Management Company (AMC)

An Appraisal Management Company (AMC) is an independent firm that manages residential real estate appraisals on behalf of mortgage lenders. AMCs administer the appraisal process by selecting a qualified appraiser, arranging the assignment, and delivering the completed appraisal report to the lender. Individual, state-licensed or state‑qualified appraisers perform the actual property valuations.

Key takeaways

• AMCs act as intermediaries between lenders and appraisers to promote appraiser independence.
• Lenders, mortgage brokers, and homebuyers generally cannot select the appraiser.
• AMCs maintain panels of licensed appraisers and assign those with local market knowledge.
• Appraisals must adhere to professional standards (e.g., USPAP) and AMC procedures for conflict-free assignments.

Why AMCs exist

Regulation and industry practice shifted toward the use of AMCs to reduce the risk that parties with a financial stake in a mortgage (such as loan officers or brokers) would influence appraisers to overstate property values. This push for appraiser independence intensified after the housing and financial crisis and influenced subsequent federal and industry rules requiring more separation between lenders and valuers.

How AMCs work

• A lender orders an appraisal through the AMC rather than directly choosing an appraiser.
• The AMC assigns the job to a qualified appraiser from its panel, typically selecting someone with local market expertise.
• The appraiser conducts an independent valuation following professional standards and returns a written report to the AMC.
• The AMC reviews and transmits the appraisal to the lender. If issues arise, the AMC coordinates corrections or follow-up.

Requirements and responsibilities

• Maintain a vetted pool of state‑licensed or state‑qualified appraisers.
• Assign appraisers impartially, avoiding conflicts of interest and prior influence from parties with a financial interest.
• Ensure appraisals comply with the Uniform Standards of Professional Appraisal Practice (USPAP) and applicable laws.
• Provide administrative oversight, quality control, and a point of contact for disputes or clarifications.

Implications for borrowers and lenders

• Borrowers and mortgage brokers typically cannot choose the appraiser for a mortgage valuation.
• AMCs help protect valuation integrity and reduce pressure on appraisers to favor a transaction.
• Potential drawbacks include an added administrative layer that can introduce delays or variability in quality depending on the AMC’s practices.

Note on effectiveness

When properly managed, an AMC assigns an appraiser with appropriate local knowledge and enforces standards that promote impartial and reliable valuations. The effectiveness depends on the AMC’s vetting, oversight, and commitment to professional standards.

Conclusion

AMCs serve as a regulatory and operational buffer between lenders and appraisers, designed to preserve appraisal independence and improve the objectivity of property valuations. Their role is primarily administrative and compliance-focused, while licensed appraisers retain responsibility for the professional judgment and content of appraisal reports.