When you are getting an appraisal, it’s important to be proactive and make sure that you understand everything that is going on. There are a number of questions that are helpful so that you can make sure that everything is going well and that the appraisal will be done as well as possible. When you know what to ask, you can stay on top of the situation and ensure an effective appraisal.
For residential appraisers, there are two types of licenses- certified and licensed. When an appraiser is licensed, this is the state’s lowest authorization level. When an appraiser is licensed, they are generally not able to appraise properties that are complex or expensive for the purpose of lending. When an appraiser is certified, this is the state’s highest certification. This certification allows these appraisers to appraise residential properties of any type no matter what the complexity and price range. When getting an appraisal for an FHA loan, the appraisal can only be done by a certified appraisal and not by a licensed one. There are some areas of the country where a licensed appraiser is the only choice, and these may be the most experienced in the area for that reason. It’s a good idea to know which type of licensing your appraiser has so that you are comfortable with their level of ability.
These are simple questions that should get you a straightforward answer. You need to have this information so that you know who the appraiser is and you can contact them if needed. There have been instances of appraisers trying to cut corners by sending out inexperienced people without licenses to do property inspections, and you need to know who is coming out. You’re paying for these services, so you need to know who is performing them and whether you are getting someone who should be doing appraisals.
Do You Specialize in Specific Property Types or Appraisal Values?
The appraiser that you’re talking to may have certification, licensure, have certain designations, and plenty of experience that may make them seem like a great candidate for your appraisal. However, if the appraiser specializes in a different type of building, such as commercial buildings, and you need an appraisal for your home, you may want to find a different appraiser. Some appraisers have only worked on properties that are lower-value and non-complex, and if your home is the opposite of that, they may not be the right appraiser for your home. When you ask about specialization, you can better be paired with a professional who has a lot of experience with the kind of building that you need to be appraised.
When you ask about the location of the office, you are trying to understand the geographic competency of the appraiser. In other words, you want to know about their experience doing appraisals in your specific area. It’s often true that those who give poor appraisals don’t understand the area very well. If their office is far away, you need to ask them about your neighborhood to make sure that they understand the area and have knowledge about it.
An appraiser with the appropriate experience for your property will answer yes. If the appraiser says no, you need to ask many more questions to gauge their actual experience and to find out whether they are the right appraiser for your property.
If an appraiser works from their home, this generally means that it is a one-person operation. It’s common for appraisers who work from an established office to share their methods and experiences with each other, and this can mean better expertise. When appraisers work from a professional office, they often provide better-quality services. If an appraiser has a one-person office, that doesn’t mean you can’t hire them, but it does mean that you need to ask them questions and become comfortable with their degree of knowledge and expertise.
Doing appraisals is complicated, and it requires the appraiser to have a lot of focus. If you find an appraiser who works at it only part-time, they generally don’t have the focus needed to carry out a high-quality appraisal, and they aren’t helpful to you, the real estate agent, the borrower, or the lender. If you find out that the appraiser is only part-time, contact the lender and ask them to send out another appraiser.
The appraiser that you hire should have years of experience in appraising. For getting an appraisal for a simple property, the appraiser should generally have at least five years of experience. For properties that have a great view, are on a waterfront, are unusual or complex, or that have large acreage, it’s often recommended that they have 10 years of experience in appraising.
Multiple Listing Systems, or MLS, are local systems that are databases that record the homes in your area that are listed as well as sold. There isn’t a nationwide system for these- it’s all local. Good appraisers will be members of the local MLS for the area you live in. If they don’t have access, they may not be good, or they may be from an area distant from you. You should ask whether they have access to this system for this reason. If they don’t, it’s time to find a different appraiser.
It’s important to ask this to find out about the past behavior and competence of your appraiser. If they have been disciplined in the past, this can mean that they cut corners or perform poor appraisals.