Once an appraisal has been completed, any communications about errors or offers of additional information must be with the client who ordered the appraisal, generally the lender.
Anna Ruotolo, vice president of business development at Opes Advisors, San Francisco, with over 30 years of experience in the mortgage industry, said upfront communication is vital. “I wouldn’t let an appraiser enter a home without being present, so I have an opportunity to provide them with information about the property,” she said. “You can conversationally determine their geographic competency by asking how often they’re in the area, or if they’re aware of a particular development.”
Marty Wagar, an appraiser with Midwest Appraisal Management Group in Portage, Mich., said the intent of an AMC is to provide a firewall between lenders and appraisers. “AMCs should be charged with having local competency rather than focusing on speed and cost,” he said. “The primary consideration for an appraiser is geographic competency, regardless of where the appraiser lives, or his or her access to local MLS data.”
Wagner said some lenders create problems by prohibiting any communications, even if it doesn’t involve valuation. Another issue is regulating a healthy real estate market with standards that were drawn up during a downturn. “As for geographic competency, it’s perfectly fine to ask a lender how their appraisals are distributed.”
John Ebner, managing director and mortgage advisor at Opes Advisors, described the recourse that might be available after an appraisal is complete. “Possibilities regarding an error include a comparable property that should have been used or excluded or adjustments for comparable properties, which can be presented for consideration. It’s not easy to get a change, but it can be done.”
Appraisal standards are improved continuously as qualifications and standards of the Uniform Standards of Professional Appraisal Practice are strengthened. The continued evolution of the USPAP helps ensure that appraisers are competent with independence and integrity.
In February 2012, NAR adopted the Responsible Valuation Policy. It serves as a guide for members and staff in advocacy efforts for federal legislation and regulatory policy. This statement of policy, aside from the National Association of REALTORS® Code of Ethics, offers guidelines for REALTOR® members and is not intended to impose new or additional standards of practice.