Are appraisal fees negotiable?

No, appraisal fees are generally not negotiable because they are set by the lender or AMC. However, homebuyers can choose lenders that use cost-effective appraisal ordering methods to avoid excessive fees.

How can homebuyers avoid high appraisal fees?

Homebuyers should review their loan estimate and ask their lender if they use an Appraisal Management Company (AMC). Choosing a lender that works directly with appraisers through platforms like Reggora or Appraisal Firewall can reduce costs.

What is the difference between an AMC and a direct lender appraisal order?

AMCs act as middlemen between lenders and appraisers, often adding extra fees. Direct lender appraisal orders, through compliant platforms, provide transparency and can save buyers money.

Why is Morgan & Morgan Talking About Hidden Appraisal Fees? Let's Dig In.

Accredited Appraisals
Feb 1
4 min read

Illustration of people holding binoculars with text overlays asking questions like 'Are you paying extra for an appraisal?' and 'Wait... where did my money go?' highlighting hidden appraisal fees and lack of transparency in real estate transactions. — Hidden appraisal fees breakdown - how AMCs impact homebuyers.

This blog post by Morgan & Morgan is spot on, and I love that they’re bringing attention to this issue—it’s a conversation that’s long overdue in the real estate world.

The Hidden Costs of Appraisal Fees

After the 2007/2008 financial crisis, new regulations were put in place to protect the integrity of the appraisal process and prevent conflicts of interest. These rules, particularly those stemming from the Dodd-Frank Act, required a clear separation between appraisers and loan officers. This shift led to the widespread adoption of Appraisal Management Companies (AMCs) as intermediaries.

But here’s the catch: AMCs are businesses too, and they need to make a profit. Many AMCs solicit bids from appraisers and often award assignments to the lowest bidder—not necessarily the most qualified professional. Then, they bundle the appraisal fee, which includes both the appraiser’s compensation and the AMC’s management fee. However, as Business Insider has pointed out, these hidden appraisal fees aren’t always disclosed to the homebuyer. That means many buyers have no idea that a significant portion of what they pay for an appraisal isn’t actually going to the appraiser.

What Can We Do About It?

At Accredited Appraisals, our mission is to educate our community and the clients we serve. But let’s be honest—we can’t reach everyone on our own. That’s where you come in. Share this post with a recent homebuyer, a real estate agent, or a local bank lender so we can all make better-informed decisions.

Now, let’s break down what we can actually do right now to make a difference.

Local Lenders: You Have Options

By local lenders, I mean Central Florida credit unions, community banks, and independent mortgage companies—not the big-name banks and national lenders. There’s a common misconception that lenders must use an AMC to order appraisals.

That’s simply not true.

While it’s true that loan officers cannot communicate directly with appraisers, their loan or appraisal departments can use non-AMC platforms like Reggora or Appraisal Firewall to order appraisals. These platforms ensure compliance without tacking on hefty AMC fees. Some of our lender clients even cover the small transaction fee themselves to eliminate additional costs for homebuyers. This creates transparency in pricing and can save your clients hundreds of dollars in unnecessary fees.

If you’re a local lender and want to work with us directly, reach out! Let’s put more control back into your hands and keep costs reasonable for your clients.

Homebuyers: Ask the Right Questions

As the Morgan & Morgan blog post suggests, look at your disclosure statement and find out exactly what you’re paying for.

What is the appraisal fee listed on your loan estimate?
Ask your lender: How do you order appraisals? How much of that appraisal fee is going to an AMC?

If they’re using an AMC, chances are, a large portion of your fee isn’t going where you think it is. Know your rights, ask questions, and make sure you’re getting the transparency you deserve.

Real Estate Agents: It’s Time to Step Up

For Listing Agents:

If you’re representing a seller and not advising them to get a pre-listing appraisal, you’re doing them a disservice. Harsh? Maybe. But it’s the truth.

Here’s why:

✅ Pre-listing appraisals can be more affordable than you think (ask me how!)

✅ They help your client understand real market value and help explain what's happening in the current market to help manage expectations.

✅ They give you negotiation leverage before an offer even comes in.

If you don’t know how to use a pre-listing appraisal as a negotiation tool, ask me. I’ll show you how to turn data into real value for your sellers.

For Buyer’s Agents:

Your buyers trust you to be their advocate, so help them make informed financial decisions.

Make sure they look at their disclosure statements and understand appraisal fees.
If you have a preferred lender, ask them how they order appraisals.
Find out whether they’re using an AMC—and if they even know that other cost-saving options exist.

If you educate your buyers, they’ll trust you more. And trust leads to lifelong clients and referrals. That’s the name of the game, right?

Let’s Build a Stronger Real Estate Community

The more we educate each other, the better we serve our communities.

If you have questions about this topic, let’s talk. I offer educational sessions for agents and lenders, and we’re now booking into March and beyond. Get your team on the schedule, and let’s make 2025 the year we put real value back into real estate.

When we work together—with open communication and a focus on education—we empower consumers to make better financial decisions. And that benefits all of us.

Be safe. Be kind. See you next time.

Disclaimer: I am not an affiliate of any of the links or companies referenced in this post. I have no sponsorships and do not receive any compensation for mentioning them. My goal is simply to provide valuable information and transparency in the real estate industry.