Small, non-delegated correspondent lenders—especially one-person companies—often struggle to understand how to comply with Appraiser Independence Requirements (AIR) when they do not have internal underwriters, appraisal panels, or segregated departments. This article explains how AIR compliance works for small entities, what belongs in the AIR Policy, what belongs in Appraisal Ordering Procedures, and how to respond when an investor asks, “Who orders the appraisal and how do you maintain independence?”
Understanding AIR for Small Non-Delegated Correspondents
AIR requires lenders to ensure:
No party with an interest in the loan outcome influences the appraiser,
Appraisals are ordered independently, and
Only individuals without a conflict of interest may communicate with the appraiser on valuation matters.
For non-delegated correspondents, AIR responsibilities are shared between:
The Correspondent (the broker/loan originator entity)
The Investor/Lender who underwrites and purchases the loan
The AMC selected by the Correspondent or by the Investor (depending on the agreement)
Because the investor performs all underwriting, the investor is typically the only party permitted to contact the appraiser for factual corrections.
Policy vs. Procedure—What Goes Where AIR Policy (2-0 Compliance Manual)
This is a statement of principles. It does not describe your workflow. It establishes:
That the company complies with AIR
That staff with loan production duties cannot influence appraisers
That the underwriter (in a non-delegated model, the investor’s underwriter) is the only one allowed to contact the appraiser about valuation matters
That all appraisals must be ordered in a way that preserves independence
The AIR Policy intentionally uses generic language because every investor has slightly different requirements.
Appraisal Ordering Procedure (4-0 Processing Module > Vendor Orders)
This is where your one-person company’s workflow is described. It includes:
How AMCs are selected
How orders are placed
How payments are collected
What software or forms are used
How customers receive appraisal copies
How communication with the AMC is handled
Investors often request clarification because they're reading the policy alone, not the workflow.
Typical Investor Questions and Required Responses
“Who orders appraisals and how is independence maintained?”
“Why does your AIR Policy reference underwriters when you do not have internal underwriters?”
“How does a one-employee company separate sales from processing?”
These concerns are addressed not by rewriting the AIR Policy, but by creating a clear workflow description in your procedures.
How Small Companies Maintain AIR Compliance With Only One Employee
A one-person company can comply with AIR under these conditions:
Use of Approved AMCs Only
You select 2–3 AMCs for all appraisal ordering.
AMCs independently assign the appraiser, maintain their own appraiser panels, and manage communications.
Using AMCs automatically satisfies the “independence” requirement because the broker has no control over appraiser selection.
You Do Not Maintain an Appraiser Panel
This is acceptable and common. Your workflow should state:
“The company does not maintain an appraiser roster. All assignments are handled by third-party AMCs to ensure independence.”
No Internal Underwriters
Because you are non-delegated:
The investor performs all underwriting.
The investor’s underwriter is the only party permitted to communicate with the appraiser about valuation issues.
This is entirely compliant.
No Internal Separation Between Sales and Processing
AIR does not require staffing separation. It requires functional separation of influence.
As long as you:
Do not attempt to influence the outcome of the appraisal, and
Place orders through an AMC system that prevents communication with the assigned appraiser
…you satisfy AIR.
Documented Process (Required for Investors)
Your procedure must describe:
How the AMC order is placed
How payment is collected
How you ensure no prohibited communication with appraisers occurs
How appraisal reports are delivered to the borrower
How communication is routed (AMC → you → investor)
What You Should Not Edit in the AIR Policy
The AIR Policy should not be rewritten to describe your exact workflow. It should remain a policy.
Do not remove references to “underwriters,” because in a non-delegated model, the investor’s underwriter still plays that role. The policy does not say your underwriter; it refers generically to the “underwriter,” meaning the responsible underwriting party. The investor’s criticism stems from reading the policy out of context, which is why your procedures must fill the gap.
What You Should Add to Your Procedures
Insert a customized step-by-step procedure describing:
How you choose an AMC
How the appraisal is ordered through the AMC portal
How payment is collected (borrower OR credit-card authorization)
How you document independence
How appraisal copies are delivered to the borrower
How communication between AMC, you, and investor occurs
Investors want this because this is where actual control-point risk exists—not in the high-level AIR policy.
Non-delegated correspondents maintain AIR compliance by using AMCs for all appraisal orders, documenting an appraisal ordering workflow that prevents improper influence, and relying on the investor’s underwriter for all valuation-related communications. The AIR Policy remains a high-level governance document, while your detailed ordering procedure—found in the 4-0 Processing Module—provides the customized workflow investors expect.