Veteran appraiser explains what the industry gets wrong about appraisals
“Not all revisions are created equal,” he said. “If you’re sending an ROV, that’s almost equivalent to a new assignment where you’ve got to research data that you maybe weren’t aware of or just needs to be analyzed and see how it fits in with the data that you did use. Whether it’s to be included in the report or not, it still requires all the analysis. So that might not be a couple-hour turnaround. That might be a day or two.”
Meier said the easiest solution to these challenges is better communication. When an appraiser identifies that an assignment is more complex than the initial order suggested, both sides need to reset expectations, he said.
“What it boils down to is communication,” Meier said. “As soon as the appraiser finds out that it’s more complicated than a standard 1004 or more complicated than changing a couple of words around in the report, they communicate that. As long as the communication is good between the two parties, that can alleviate some of the problems that would happen. But the expectation from the lender sometimes feels like a 1004 can turn around in 24 hours when it’s not necessarily always the case.”
Alternative valuations and high-pressure deals
The second area of confusion is how alternative valuation products differ from a traditional appraisal, Meier said. This category covers broker price opinions (BPOs), automated valuations, and waiver-eligible transactions.
“While these products do have their place, it’s a different level of analysis and experience from the professional that goes into the process,” he said. “If it’s a BPO or something like that, that’s someone who’s in the field selling properties, and they’re coming at it from a different point of view.”
