Appraisals

   


















         
   
A competent appraisal report has the following elements contained in it:
  • A cover document explaining in detail what type of value is being sought ("purpose") and how the appraisal is to be used ("function" or "assigned use").
  • The methodology and resources relied upon, including market analysis and market(s) selected.
  • A complete accurate description of property written in such a manner that it can be identified without photographs.
  • The date(s) and location of inspection, and the effective date of value.
  • A statement by the appraiser that he or she has no financial interest in the property of that such interest is disclosed in the report.
  • The appraiser's qualifications and signature.

Do not accept an appraisal if...

  • It is handwritten or unsigned.
  • The fee is based on a contingency or upon the value of the property.
  • The appropriate "purpose" and "assigned use" are not stated.
  • The item is beyond the appraiser's expertise.
  • the appraiser is not willing and able to defend it in court (subject to the appraiser's availability, and separate fee arrangement).

Some essentials for every appraisal...

  • Name and address of client requesting appraisal.
  • Name of owner of property if different from above.
  • "Effective" date of appraisal.
  • Type of appraisal (i.e. fair market, retail replacement, diminished value, etc.).
  • Definition of the appraisal terminology.
  • Intended use or purpose of the appraisal.
  • Description of items including all pertinent information necessary to distinguish appraised item from other like items.
  • Condition of item (e.g. "as is", etc.) if applicable.
  • Value of the items based on specified marketplace.
  • Methodology used in determining value.
  • Signature of person or persons who made the valuations.
  • Statement of compliance to USPAP codes.
  • A statement of any limiting conditions or assumptions, if applicable.