JPMorgan Chase recently donated $3 million to the Appraiser Diversity Initiative, putting its financial support behind a growing movement to bring more diversity to the residential appraisal field.
The initiative, which is part of a collaboration between the Appraisal Institute, National Urban League, Fannie Mae and Freddie Mac, is intended to attract diverse new entrants into the residential appraisal field, overcome barriers to entry (such as education, training, and experience requirements), and provide support to position aspiring appraisers for professional success.
The commitment will be spread out over three years with Chase devoting $1 million per year to support trainee education packages. This investment will help approximately 700 students with costs that include textbooks, calculators and the purchase of any additional required courses.
A commitment to advance racial equity
Chase has had ongoing discussions with the Appraisal Institute and Fannie Mae on ways to support the Appraiser Diversity Initiative since the first quarter, and this isn’t the bank’s first financial commitment to advance racial equity.“JPMorgan Chase is taking a comprehensive approach to narrow the racial wealth gap in the U.S., particularly among Black and Latinx communities.
“Last October, we announced a $30 billion commitment to advance racial equity of which $26 billion is dedicated to expanding affordable housing and sustainable homeownership in underserved communities,” Mark O’Donovan, CEO of Chase Home Lending, said. “In addition to driving sustainable homeownership, we’re working with our partners to root out bias in the residential appraisal process. We need new, diverse talent to join the appraiser industry and we’re hopeful that these scholarships will help pave the way.”
Dan Hofacker, head of Collateral Valuations at Chase Home Lending, added to that saying, “This announcement toward the Appraiser Diversity Initiative is another step forward in helping to close the racial wealth gap by offering support to students and professionals interested in joining the appraisal industry who may have previously felt unable to. We’re hopeful that our contribution will help to make positive changes in the industry.”
According to Hofacker, along with the financial commitment, Chase will provide additional resources.
“Chase is offering mentors to trainees in the ADI program — these are seasoned appraisers who the trainees will be able to consult for questions or advice,” Hofacker said. “Additionally, as we return to in-person events, Chase is offering the use of our conference center space for the ADI program, as needed.”
According to the Appraisal Institute’s breakdown of the state of the appraisal industry, there were 78,000 appraisers in the U.S. at the end of 2018 and just 40% of those focused on residential appraisals.
Seventy-nine percent of all appraisers identify as male and 71% are over 50 years old, per the trade group. Eighty-five percent of appraisers stated they are white. Four percent said they were Hispanic, 1% reported as Asian, and 1% said they are Black.
Hofacker said he is hopeful that initiatives and scholarships like this one will pave the way for diverse talent to join the appraiser industry. And part of driving sustainable homeownership, according to Hofacker, is working with their partners to help root out bias in the residential appraisal process.
Why become an appraiser?
And while a career as an appraiser isn’t typically a dream profession for young students, he said he would want college students who are thinking about getting into the appraisal industry to know that there is great demand for appraisers in the housing industry.
“Where a waiver does not exist, almost every home purchase requires an appraisal as a part of the process, so a career in this industry can provide stability,” he said. “Additionally, while it can be different from place to place across the country, a career in the appraisal industry has great earning potential,” he added.
With partnerships such as Chase’s, ADI can help share information about the opportunities to work flexible hours in the field and/or from a home office, and the use of cutting-edge technology.
“One of the Appraisal Institute’s top priorities is to encourage recent graduates to consider a career in the valuation profession with a particular focus on diversifying our ranks,” Appraisal Institute President Rodman Schley said. “The Appraisal Institute is truly grateful to Chase for making such a major commitment to helping the next generation of appraisers.”
Jake Williamson, Fannie Mae vice president for Single-Family Collateral Risk Management, echoed this sentiment, said, “Chase’s generous contribution to ADI is hugely impactful.”
“Their financial and staff support commitment greatly increases the capacity to attract new entrants to the field and actively support their career aspirations,” he said.
A $30 billion commitment
When Chase announced its $30 billion commitment to advance racial equity last year, the funds were designated to:
- Promote and expand affordable housing and homeownership for underserved communities
- Grow Black- and Latinx-owned businesses
- Improve financial health and access to banking in Black and Latinx communities
- Accelerate investment in our employees and build a more diverse and inclusive workforce
These commitments included specific goals like originating an additional 40,000 home purchase loans for Black and Latinx households and helping an additional 20,000 Black and Latinx households achieve lower mortgage payments through refinancing loans.
“Systemic racism is a tragic part of America’s history,” Jamie Dimon, Chairman and CEO of JPMorgan Chase, said at the time of the announcement. “We can do more and do better to break down systems that have propagated racism and widespread economic inequality, especially for Black and Latinx people. It’s long past time that society addresses racial inequities in a more tangible, meaningful way.”
As Chase continues to support diversity initiatives, such as the Appraiser Diversity Initiative, the bank plans to release a progress update later this year, which will share an overview of some of the key changes that their donation has made for the ADI.
As a result of initiatives like this one, Hofacker said, “Chase hopes that other lenders and interested parties with appraisal field experience get involved and give back and support the Appraisal Diversity Initiative, either by taking the time to be a supervisor/mentor to trainees, or by being an event or financial sponsor.”
This article was first featured in the Oct/Nov HousingWire Magazine issue. To read the full issue, go here.