Why Is the Appraiser My Friend?

Real Estate Agent with Reliant Realty in Nashville, TN TN License# 00232013

Why Is the Appraiser My Friend?

As a REALTOR®, and a former Mortgage Loan Officer, I have worked with many Real Estate Appraisers, some better than others. I have worked with many Home Inspectors, Insurance Agents, Lawyers, Government Officials, Underwriters and Loan Processors; and several things can be said of each profession as well as our own. Among them are words of praise, criticism, observations, and misconceptions, and an assessment that some are better than others.


Today, I was wondering how much REALTORS® really know about Residential Appraisers. Are REALTORS® aware that before appraisers are permitted to sign off on properties, their work MUST BE REVIEWED by their sponsoring appraiser, and this is on every appraisal for a year or more? Where agents and loan officers are required to take a couple of classes and a State exam, appraisers must take close to a dozen courses and State exams. Additionally, once they receive their designations, they must apply to each lender, individually, provide samples of their work, resumes, letters of recommendation, as well as carrying E & O insurance. Then, they spend the remainder of their careers being second guessed by homeowners, REALTORS®, contractors, home builders, governmental bureaucrats, and underwriters.


The appraiser must determine value (1) based on Closed Sales, (2) Replacement Costs, and (3) Rental Income when appraising Income Producing Properties. They must take their own photos (interior and exterior) of the Subject Property, and exterior photos of the Comparable. Appraisers must check public records, address easements, encroachments, right-of-ways, report economic impact, demographics, and justify why they used the selected comps as well as why they did not include other properties. Their comps must meet numerous criteria, and be adjusted +/- dollar figures where such differences as fireplace, bathrooms, garage and basement space differ, square footage, lot size, age, etc. That is a great amount of work, and the final product may well make or break a deal.


How many of us have ever sat down and reviewed the Uniform Residential Appraisal Report, FannieMae Form 1004? Among the Sections that the Appraiser must complete are details about the Subject Property, Analysis of the Contract [Note that FannieMae REQUIRES the appraiser to review the contract], the Neighborhood, the Site, the Improvements, Sales Comparison, Reconciliation, Cost Approach, and Income Approach.


The Real Estate Appraiser is the EXPERT OF RECORD on VALUATION, and the first thing one learns is that BUYER & SELLER establish the basis for arriving at property value opinion. The appraiser’s task is to consider all aspects of the sale before making that determination, such as  Is the property as Seller represented, and Buyer presumed? Are their factors beyond Seller and Buyer’s knowledge and understanding? Example: Seller represents square footage as 3,000 sq. feet; but included a non-heated porch/room within that figure. After correction, does the value of the property remain sufficient to support the agreed upon price?


Over coming weeks, I would like to delve into the expertise, responsibilities and other elements of the appraisal process, and the vital role played by the appraiser. I welcome input and questions, and I hope to help others come to know the great contributors to our profession, whom we call appraisers, and many may go so far as to call them friends. I do.

May this serve to recognize the work of those who begin their days with the sun, and outlast it's rays on many days.

Posted by

Fred Cope, Reliant Realty, Nashville, TN -- (615) 587-3500 -- http://www.LookingForHomes.org --30 years experience in real estate and finance

Comments (9)

Joan Cox
House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

Fred, I often receive calls from appraisers checking data from my closed listings, and always help them.  The appraisal is a complicated form, and have gone over it, but mostly to look at the comps used.

Sep 08, 2015 08:05 AM
Tammie White, Broker
Franklin Homes Realty LLC - Franklin, TN
Franklin TN Homes for Sale

As you know, a recent experience has tainted my view of the appraisal process. It appears that appraisers are more interested in confirming that a house is appropriate collateral for the lender, than providing an actual value for the home.

Sep 08, 2015 12:41 PM
Fred Cope

Yes, Tammie, that is their job, and without them we would never get the deals done.  I don't know these new guys, but the old timers always told me that the do not set the value -- the market does.  If I called Bob Chaffin (uncle the Bobby Chaffin) and asked his best guess of what a property would bring, he was reluctant, but accurate.  Bob Collier would run numbers for me when I sold my parents' properties, and would tell me whether it would pay to do certain improvements.  He worked for the Davidson County Accessor's Office for several years.  He is still working at @ 70 years old.  He covered about twenty Counties, carried no cell phone, returned calls in the evenings, and the Sun had to get up early to keep up with him.

Sep 08, 2015 08:52 PM
Lou Ludwig
Ludwig & Associates - Boca Raton, FL
Designations Earned CRB, CRS, CIPS, GRI, SRES, TRC


The fact of life is we will be working with appraisers . . . . It's to every-ones best interest to work with the appraiser . . . .

Good luck and success.

Lou Ludwig

Sep 10, 2015 12:25 PM
Joe Petrowsky
Mortgage Consultant, Right Trac Financial Group, Inc. NMLS # 2709 - Manchester, CT
Your Mortgage Consultant for Life

Good morning Fred. I actually have a number of Appraiser friends. They have taught me a lot. It seems some care about the work that they do, others that is not the case at all.

Sep 14, 2015 07:48 PM
Fred Cope

Joe, I can name a few, but cannot name more than one client who used him on my watch, under the good ole system where the LENDER (local) selected the Appraiser.  We didn't waste much time on them.  With the blessings of our owner, Appraiser selection was my call as the MLO.  Very rarely did I reach out beyond three of four appraisers.  I told agents that they were holding me accountable to close their deals on time, and when I made that commitment, it was based on knowing the people who had to perform.  Our shop probably has a dozen or so Investors to sell to, but there were about four I trusted to get the job done in a timely manner, and 90% of my business went to either SunTrust or US Bank.  I never had a complaint from either about the two appraisers I used.  Generally, I got 24 to 36 hour turn times, and was ready to close in less than 21 days from initial LP Input.  Why mess with a good thing?  Government meddling.

Sep 15, 2015 03:39 AM
Larry Johnston
Broker, Friends & Neighbors Real Estate and Elkhart County Subdivisions, LLC - Elkhart, IN
Broker,Friends & Neighbors Real Estate, Elkhart,IN

Hi Fred Cope , Most people don't know what an appraiser goes through to approve a home value.  They are starting to become scarce in our area, which will mean a longer wait time.

Sep 21, 2015 11:04 AM
Fred Cope
Reliant Realty in Nashville, TN - Nashville, TN
Looking For Homes With A Smile

Larry, my experience is that "people want to kill the messenger" rather than fix the problem.  Appraisers, inspectors and Loan processors take so much heat due to seller or buyer ignorance, agent arrogance or determination to avoid a problem.  How many times have I heard an agent want to argue degrees of defect rather than advise the seller to get something fixed.  Slight of hand is  often employed just to avoid an issue.  One seller borrowed a window screen from a neighbor to avoid the condition, and then Buyers caught it on walk through.  Their agen suggested it.  An appraiser told me that IF he made a concession, the next thing he knew, every agent in that Agency was demanding the same.  A little tip I learned I learned: do what is expected, and be ready to do more.  When the appraiser learns that about you, he is easier to get along with.  He knows you want to do right by that Buyer.


In every profession there are people who go out of their way to be fair, nice and helpful; and then their are those that expose their back side, their ignorance and their bad judgment.

Sep 22, 2015 01:43 AM
Debbie Laity
Cedaredge Land Company - Cedaredge, CO
Your Real Estate Resource for Delta County, CO

Appraisers do have a lot of work that goes into their reports. This is a great shout out for them. Like us...they work harder than most people realize. 

Sep 25, 2015 10:19 AM
Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude

Fred Cope 

My experience for the most part with appraisers has been positive. And when one reviews the documents they have to complete but also talks with them about they look for, comparisons they must make, market conditions to consider, and more, it's a pretty complex job. Granted some are far better than others.


Sep 29, 2015 02:23 PM
Lou Ludwig
Ludwig & Associates - Boca Raton, FL
Designations Earned CRB, CRS, CIPS, GRI, SRES, TRC


Thank you for stopping by and commenting on my post.

Good luck and success.

Lou Ludwig

Oct 03, 2015 11:54 AM