You’re not the only one worried about the quality of your appraiser. The stakes for the lender are also pretty high. Here are the risks they must mitigate when hiring appraisers:
- Credentials. Lenders must be certain that all appraisers working on a deal are credentialed, credible and reliable and their reports were completed competently. These are critical factors in case of disputes.
- Confidence. Lenders need to feel confident they’ll be able to get sufficient value out of selling a property, if it’s taken back in foreclosure. This involves a full assessment of market risk in all of its dimensions, such as the affects on value of busy roads or obsolete functionality.
- Integrity. Lenders are required by law to avoid bias and they must be prepared to demonstrate this. The appraisal is an element of their proof, and high-integrity appraisers are critically important.