10 Questions to Ask Your Appraiser

#1 What is your name and telephone number?

Simple, straightforward and you’ll need to write this down for future reference. 

Why? We have examples where the assigned appraiser sends an inexperienced, non-licensed person to inspect a property.

Why would they do that? The appraisal company/AMC maybe cutting corners. 
Since you, or your clients, are paying a fee for this service, make sure you get the best which increases your chances for a good appraisal.

#2 What is your license (or certification) number?

This question can be intimidating to an appraiser who is beginning to realize you are serious about the appraiser's qualifications. If they don’t know the answer, maybe they are not certified. Warning flag that should trigger more questions.

#3 Where is your office located?

You are trying to get a sense for the appraiser’s experience in your area; In the appraisal world this is called “geographic competency.” 

We often find that the appraisers who are providing bad appraisals do not understand your corner of the world. So if their office is distant, start asking the appraiser questions about your general neighborhood. Ask until you feel comfortable with the appraisers knowledge about your area.

Your appraiser does not necessarily need to live or have an office located in your direct area but they need to be informed on the market and have geographic competency.

#4 Do you work out of your home or a professional office?

If they work out of their house, it's an indicator of a one-man operation. We find appraisers that work out of a professional office share experiences, knowledge and methods. Appraisers that work as professionals produce a higher quality product .After all that is what is expected and required in federal law. A one person office isn’t a deal killer, but you should ask questions until you feel comfortable with their knowledge.

#5 How long have you been appraising?

We recommend a minimum of 5 years of experience for simple properties and 10 years for complex and unusual homes, waterfront, large acreage or view properties.

#6 Have you ever been disciplined before?

If the appraiser has been disciplined you likely have an indicator that the appraiser cuts corners, or worse. 

#7 Are you a full time appraiser?

Appraising is complex and requires focus.Part time “form-fillers” are of no benefit to you, the borrower, real estate agent or lender. [I have no idea why AMCs hire them]If the person is part-time, ask the lender to send someone else.

#8 Are you licensed or certified?

There are 2 categories of residential appraisal licenses (Certified and Licensed).A licensed appraiser is the lowest level of authorization by a state. Typically these individuals are not allowed to appraise expensive or complex properties for lending purposes. A certified appraiser is the highest level of authorization by a state. Certified appraisers are allowed to appraise any residential property, in any price range, of any size and complexity.

Appraisers that are only licensed, typically are not credentialed to do "complex appraisal assignments" for loan purposes. FHA does not accept appraisals from "licensed" individuals, only “certified” appraisers. 

#9 Have you ever appraised properties of this type in this area?

An experienced appraiser would answer yes. If the answer is no, start asking a lot more questions.

#10 Are you a member of the local multiple listing system (MLS)?

This is critical! The MLS is a database of the homes that are listed and sold in your area.

MLS’ are local, there is no nationwide system. So good appraisers have access to the local MLS for your area. Appraisers that do not have access are either incompetent or from distant areas. 

If they don’t have local access – insist on another appraiser and do not allow this one into your home.