Wells Fargo Paying JVI Bad Debt

By Isaac Peck, Associate Editor

Appraisers getting stiffed by appraisal management companies (AMCs), that either declare bankruptcy or simply fail to pay, remains a hot-button issue for the industry.  As many appraisers are reporting on OREP/Working RE’s AMC Rater blog, JVI Solutions is the latest AMC to leave appraisers with unpaid invoices; some say they have not yet been paid for work completed in early 2012.

Now, one lender is stepping in to pick up their share of JVI’s unpaid debts.

Vicki Grant, an appraiser from Minnesota, says her company had three unpaid invoices from JVI for appraisals that were completed in June 2012.  After JVI failed to pay, Grant, who has a banking and collections background, says she filed complaints with the Department of Commerce in Minnesota and the Florida Department of Business and Professional Regulation (the state JVI is headquartered), each of which had already received multiple complaints against JVI from other appraisers.

Additionally, Grant mailed a letter to Wells Fargo requesting that they pay her firm for the appraisals. “I sent a certified ‘request’ letter to Wells Fargo on September 21 explaining that my company completed appraisals for JVI, where Wells Fargo was the client, and I requested that they cover the unpaid invoices,” says Grant.

To Grant’s delight, her firm has just received a letter from Wells Fargo (November 14), offering to compensate her firm for appraisals completed on behalf of the lender.  In its letter, Wells Fargo does not specify why JVI is failing to pay appraisers, but simply states: “We have learned that JVI has experienced certain difficulties that may have resulted in non-payment to you for appraisals performed on behalf of Wells Fargo.”

Veronica Clemons, a Wells Fargo Communications Representative, released this short statement to Working RE: “Wells Fargo is offering to compensate appraisers who have completed appraisals on behalf of Wells Fargo.  We have proactively reached out to appraisers who may have been impacted.”

When asked how appraisers should proceed if they have Wells Fargo/JVI unpaid invoices and have not been contacted yet, Clemons said that the bank knows who completed work for JVI on behalf of Wells Fargo and is making every effort to proactively reach out to them with the offer to cover unpaid invoices.

It appears from the letter sent by Wells Fargo to Grant, that the lender, while agreeing to pay, has stopped short of acknowledging they have an obligation to pay. The letter states: “Although we are stepping forward to ensure that JVI fee appraisers are paid for services delivered to Wells Fargo, our payment to you to cover unpaid JVI balances shall not be construed as an admission by Wells Fargo of any obligation incurred by Wells Fargo to pay you for any outstanding balance that is due and owing by JVI for Services performed by you.”

Nevertheless, Wells Fargo appears to be honoring JVI’s unpaid invoices for work completed on their behalf, which is a gesture that will surely be appreciated by appraisers.

The closing paragraph of the Wells Fargo letter to Grant states: “We would like to assure you that we regret that this situation has occurred and any financial impact that it may have had on your business.  We hope by offering to compensate you that we are helping ease any financial burden the situation may have caused you.  Should you have any questions regarding this request, please feel free to contact us at RVSRequest@wellsfargo.com.”

MetLife Pays Up for AppraiserLoft
When AppraiserLoft declared bankruptcy earlier in 2012, leaving an estimated $3 million in unpaid appraiser invoices, Working RE reported that many appraisers held the lenders who hired AppraiserLoft responsible for the unpaid invoices (click to read AMC Bad Debt – Lenders Responsible?), and that some appraisers were successful in collecting unpaid debts from select lenders (click to read Success Collecting AMC Debt from Lender).

In the case of AppraiserLoft, MetLife Bank was among one of the few lenders that made good on the bad debt created by its agent (click to read Lender Paying Appraisers Stiffed by AppraiserLoft).

Now there are two lenders doing the right thing.