This week I came across a post in one of the appraisal forums that really caught my attention. An appraiser was venting about how they had referred a client to another appraiser, agreed on a referral fee, and then never got paid. They went out of their way to help a client in a tight spot, and when it came time for the other appraiser to follow through, they suddenly “didn’t get the job.” The post ended with a fair question: where are the ethics and professionalism in our business?
What really stood out to me wasn’t the post itself, but the reaction. Some appraisers agreed completely. Others acted like asking for a referral fee was some kind of moral failure.
Let’s clear this up. Referral fees are perfectly appropriate when it comes to non-lender work such as estate, divorce, pre-listing, trust, litigation, or any other private assignment. You cannot collect a referral fee for federally regulated or government-related work, and that’s not what we’re talking about here. This is private business between two professionals helping a client.
Here’s the logic: if your phone rings because you’ve built strong relationships and spent time and money marketing your business, that lead has value. When you can’t take the job, maybe it’s commercial, outside your area, or you’re simply booked, referring it to another appraiser and earning a small percentage for your effort isn’t shady. It’s smart.
Real estate agents do it every single day. They refer clients to other agents and take 25 to 40 percent. Nobody calls that unethical. Meanwhile, many appraisers are paying 30 percent or more to AMCs on lender work and calling it “normal.” So paying a middleman is fine, but paying a colleague who actually sent you business is somehow a problem? That doesn’t add up.
Last year alone, I referred out close to $50,000 in non-lender work and earned between 10 and 15 percent on those referrals. The accepting appraiser was free to quote whatever fee they wanted. The client was taken care of. Everyone won.
Referral fees aren’t about greed. They’re about recognizing value. You put in the work to build your brand, answer the calls, and maintain those relationships. That deserves fair compensation. Just be transparent about it, agree upfront, document it, and make sure it’s for private, non-lender work only.
Appraisers need to stop treating business like a dirty word. We spend enough time complaining about low fees and AMC pressure. Yet when there’s a simple, professional way to create more revenue and support each other, half the industry wants to argue about ethics.
It’s time to start thinking like business owners. Agents figured this out decades ago. It’s about time appraisers caught up.
That’s exactly why I started the Appraisal Referral Network, to help appraisers connect, refer out non-lender work, and both earn fairly. If you’re ready to grow your business and support your peers at the same time, visit ReferAppraisals.com. Let’s help each other win, not tear each other down.
