What is an Appraisal Management Company (AMC) and why is it used?

• A. A regulatory body overseeing appraisals.
• B. An intermediary that orders appraisals to promote independence and standardization, ensuring unbiased valuations.
• C. A mortgage insurer.
• D. A real estate agent network.

Answer: (B)

An Appraisal Management Company is an intermediary that coordinates and manages the appraisal process for a lender. It hires and assigns licensed appraisers, oversees the ordering and delivery of appraisal reports, and conducts quality control to ensure reports meet professional standards and regulatory requirements. This setup helps keep the appraisal process independent from the lender and promotes standardized procedures across valuations, reducing potential bias and ensuring more consistent, credible results.

In practice, this independence matters because it minimizes lender influence on the appraiser, supports USPAP compliance, and helps with regulatory expectations for unbiased valuations. It’s not a regulatory body, an insurer, or a network of real estate agents—the role is specifically to facilitate fair, standardized appraisal work for lenders.