A real estate appraisal is an objective opinion of the value of a particular parcel of real estate given by a professional appraiser. But the process is much more detailed and involved than that one sentence definition. The appraiser must thoroughly inspect and gather information about the subject property and the surrounding area. The appraiser will consider all the relevant factors about the property and the neighborhood, both negative and positive. A search for similar properties that have sold will be made and the most relevant of these will be inspected by the appraiser and photographed. If it is an income producing property that is being appraised then the amount of income that the property produces will be taken into consideration. After the appraiser has gathered as much information that is needed relevant to the property being appraised, the appraiser follows a process that leads them to a logical conclusion as to value of the property. Depending on the type of property it might take the appraiser anywhere from a few hours to a few days or even weeks to complete an appraisal. Of course the property owner usually only sees the appraiser when their property is being inspected, but most of the appraiser’s time to complete the appraisal is spent away from the subject property location.

A professional real estate appraiser must be licensed or certified by the State in which the property that is being appraised is located. These licensing requirements include educational requirements, experience requirements, and the passing of required exams. There are different certification levels for appraisers and the type of certification an appraiser holds qualifies them to perform certain types of appraisals.

The appraiser works for their client, the person or corporation that hired them. As an example, when you apply for a mortgage loan the lender is going to want to have your house appraised in order to determine the value so that they can loan you a percentage of the value. The lender engages an appraiser to perform the appraisal. The lender is the client so the appraiser works for the lender. But wait, you say, the lender charged me for the appraisal shouldn’t the appraiser be working for me? The answer is no. Even though the lender passed along the appraisal fee costs to you the lender is still the client because they hired the appraiser. But, if you did pay for the appraisal fee, the lender is legally obligated to give you a copy of the appraisal if you ask for it in writing. In addition, do not hesitate to ask the appraiser questions or point out any discrepancies on the appraisal report to the lender. After all, even though you are not the client, the appraisal affects you and your loan.

That depends on the lender’s policies. Most lenders will want to first make sure that the appraiser you use is on their “approved list”, and if not will either not allow you to use the appraisal, or ask your appraiser to provide them with the documents they require to be approved. Most lenders require the appraisal not be over so many months old. Most lenders want the appraisal to have the lenders name on it as if the appraisal were done for them, so this means that the appraiser is going to have to do some additional work if they are willing in order to satisfy the lender. Some appraisers are not willing to do this. Some appraisers will do this additional work for an extra fee. If you are going to get a loan check with your lender first for their policies and procedures before rushing out to hire an appraiser. If you already have a recent appraisal on your property then show it to the lender and maybe it will save you some or all of the appraisal fees depending on your lender’s policy.
If you are selling your home a professional appraisal will be very helpful to you in setting the sales price and negotiating with buyers. If you own a home and have PMI on your loan an appraisal is usually needed to have it removed. Property settlements for divorce, estates, and tax appeals are all reason to have a property appraised. See our Services page for more details about different types of appraisals and reasons for them.

The same way you hire a qualified Lawyer, Accountant, or any other professional. Ask Questions! First ask for referrals from lenders or others who deal with appraisers on an ongoing basis. Then ask questions to the appraisers about their experience, qualifications, and the like. Make sure the appraiser does a large amount of the type property you want appraised and in your location. Do not be afraid to ask! It is unlikely that an appraiser would be offended by your questions, but if they are don’t use them, go to the next one. A true professional is never afraid to answer questions about their profession and their qualifications. Ask for the appraiser’s resume. Appraisers keep a current resume available in order to give lenders and other corporate clients. Finally, go with your feelings and make sure you feel comfortable with the appraiser. You want to be able to discuss the appraisal with the appraiser when you have questions so you want someone that you feel you can relate to.

These letters are professional designations from various appraisal organizations. This means that, in addition to State licensing or certification, that this appraiser has also met the qualifications of these appraisal organizations and been awarded a professional designation. These designation requirements vary according to the designation category and to the organization that awards them. Most organizations require completion of educational requirements, experience requirements, and submission of demonstration appraisal reports and/or review of actual appraisal reports over a period of time. There are many appraisal organizations. Among the largest are the Appraisal Institute, the American Society of Appraisers, and the National Association of Independent Fee Appraisers.