America's Cutting Edge Transforms Real Estate Appraisal Industry (8/03)

Like FedEx and other companies that forever changed an industry, the nation's top mortgage lenders, real-estate agencies and investors are convinced a brilliant new Franchise concept out of New York will drastically reform the world of residential real estate appraisals.

America's Cutting Edge Real Estate Services (ACE Franchising), a leading provider of real estate appraisals since 1998, has already made its mark on a sizeable industry in dire need of change. ACE has gained the respect - and financial backing - of key industry insiders, raising more than $4 million in venture capital from investors who strongly believe in its consistent ability to deliver quality residential real estate appraisals within 24-hours from the point of inspection.

ACE's use of high-tech mobile offices, staffed by uniformed teams of appraisers, has raised the bar in the industry and drastically sped the appraisal process.

"By leveraging advanced technology and process redesign, we have positioned ACE for expansion into new markets across the United States," said Michael Reilly, vice president of franchise sales and managing partner. "By launching a strategic Franchising model, our goal is to launch 1,000 ACE vehicles in the top 40 markets over the next three to five years."

While independent appraisers are plagued by excessive paperwork, bureaucratic hassles and travel time, ACE has streamlined the process for its licensed appraisers by handling all the red tape and administrative tasks, including appointment scheduling, at its corporate office. ACE appraisers are free to focus on their best skill - appraising property - saving precious time for all parties. ACE appraisals are typically complete within 24 hours or less from the time of inspection, compared to the average three or more weeks it takes when working with most independently operated appraisers.

Productive Professionals on a Mission

Operated by experts in franchising, real estate, finance, sales and computer technology, ACE is rapidly meeting the demand for fast, efficient and cost-effective appraisals. Currently, with franchise offices in New Jersey and three company-owned units in New York, Connecticut and Massachusetts, ACE's 30 licensed appraisers deliver more than 1,500 appraisals each month to its customers, which include 15 of Top 20 lenders in the country.

"We have pent up demand in every city in the United States," Reilly said. "We are about to change an industry. We're striving to create a staple for the bank industry, because, right now, as far as appraisals are concerned, they don't have one."

Dressed in professional attire, ACE appraisers (one licensed trainee and a fully-certified appraiser) pull up to a customer's driveway in a clearly branded, clean, white-mini van that is fully equipped with technology to instantly communicate with the home office Operations Center, resulting in a quick turnaround.

Trained customer service representatives closely monitor every order. In addition, while appraisers are in the field, dispatchers communicate with the homeowners and real estate agents, track assignments and set appointments for the appraisers. Each van is equipped with a 1000-watt inverter, dual battery system, digital camera, Global Positioning Systems, cell phone/2-way radio, a printer/scanner and a wireless Internet connection. A full-service review department interacts with the appraisers, underwriters and loan officers.

Time is money

"When you partner teams of on-site professionals with leading-edge technology, the result is speed, quality and consistency unlike anything this industry has ever seen before," said Dan DeMonte, vice president of sales and also a managing partner. "We have essentially recreated the process with one of the quickest and most efficient appraisal systems in the nation," noted DeMonte, a former mortgage lender with firsthand experience dealing with appraisers on the other side of the fence. "There are many excellent appraisers in the field today, what is lacking is a strong system to support them; that is what we have created."

Similar to the residential real estate brokerage and Home Inspection industries, ACE believes it can use franchising as a tool to create strength in numbers, protecting independent appraisers against market vulnerability. While the average independent appraiser conducts 40 to 60 appraisals a month, ACE appraisers turn around an average of 75 to 100. The big difference is not only in the amount of appraisals completed, but the amount of hours an appraiser spends (work hours) completing them. The ACE model puts a normal eight- hour work day back into the life of the appraiser, as opposed to the appraiser's traditional work day of 12 to 15 hours.

"We not only handle all of their back-office needs, we manage the demand for their services," DeMonte said, noting that one current franchisee increased their monthly income by 50 percent. "With ACE, appraisers can stay on the cutting edge of technology, which is vital to keep working with large national banks and to stay consistently productive."

Changing lives

Lifestyle improvements are another key benefit for ACE appraisers. Often, independent appraisers come home after several appointments in a day to an answering machine chock full of messages with questions that need to be answered, and numerous faxes and other administrative work to accomplish. Their workday extends into the late evening.

"Because all our appraisers do is appraise, completing the majority of their work in the field becomes a reality in turn allowing for more quality time with their families," Reilly said.

Entrepreneurs seeking to invest in the ACE opportunity don't have to be\ appraisers. The company offers five-vehicle area development deals that allow the investor to hire licensed appraisers as their employees to conduct the appraisals. For that deal, the initial investment involves a $39,500 franchise fee.

The ACE individual Franchise Opportunity program is geared to individual fully-licensed appraisers who work out of their homes. These franchisees purchase one vehicle, hire one apprentice and typically work from home. The franchise fee for that opportunity is $10,000, plus an Operations Center fee and a six percent royalty. Financing is available. Extensive training, marketing, advertising and field sales support is provided.