Appraisers over-stepping their license? Stepping on ours?

[Buck Hartley, CMI]

Gary,

I think you need to check your facts about KS appraisers!

[Joseph W. Keresztury]

Originally Posted by bhartley

Gary,

I think you need to check your facts about KS appraisers!

So Buck, What does that mean?

[Jim Hime]

Found the CFR on real estate appraisers I've had during a rare event of desk cleaning. (I thought it was a cherry colored desk the last time I saw it.)

Federal Register Vol.65 No.101; May 24, 2000, Rules and regulations
page 33679

(k)(1) Financial Institution (definition paragraph)
(2) examples of financial institution

(ii) a personal property or real estate appraiser is a financial institution because real and personal property appraisal is a financial activity listed in 12CFR 225.28(b)(2)(i) and referenced in section 4(k)(4)(F) of the Bank Holding Company Act (of 1956).

As we know it the typical appraiser is paid by the lender and works for the lender (not the buyer). If the appraiser sees something that might cost the lender money then he/she has a right to ask for more information or whatever else they suggest in order to cover themselves as they are held liable for the valuation and condition of property. The actual lender wants to know if a property is a pig with lipstick and will deduct from valuation (old roofs, cracked slabs, lots of wood rot, etc.) So, when a real estate appraiser is asking for something it is the same as the lender asking for the information.

Tip: If you ever buy a home make sure you get a good inspection and provide a copy of the inspection to the real estate appraiser.
They will deduct from value what they consider cost of repair as condition has an affect on market value. In a lot of areas a good inspection (for defects) is a great way to reduce your yearly property tax valuation. If you have contractor repair quotes and pictures the tax man will deduct that from the tax value. They do expect you to have repairs made by the next year but if you don't - go back and protest.