You have an approved appraiser panel with active state certification licensing and E&O. That’s all your appraisal department needs to have the best appraisals and reviews, right? Probably not.
To receive the very best appraisals for your department, you need the right appraisers doing the right property and in the right location.
Consider these three ideas for more consistent positive outcomes.
Top 3 Best Practices
- “Competent” doesn’t equal excellent
- Determine engagement
- Soft skills
When commercial fee appraisers fill out their profiles, the default is to indicate that they can appraise most every property type. The reality is most commercial appraisers are very good at a few property types and less so at others. Typical property types that are not deemed competent by most appraisers might include c-stores, assisted living facilities and some special purpose properties. Other than that, the majority of appraisers will indicate they can appraise pretty much anything. It’s not a bad thing it’s just what happens.
So what’s the answer?
So how does one differentiate competency from excellence? By having a conversation. Ask your appraisal vendors upfront to have a frank conversation. On the phone. Not email. Zoom would be better. Appraisers typically have a very high ethics bar. Having frank discussions of what property type and geographical location they can best cover is reasonable.
If your appraisers were put on your list years ago, some firms may have had a change of leadership. Perhaps they consolidated. Maybe they’ve added some new talent with additional skill set you’re unaware of. It could turn out that they’re only working part-time. Approve individual appraisers rather than the entire firm.
But you’re probably wondering
Fee appraisers do not like the decline in the number of bids they receive with this bucket methodology. However, the more progressive appraisers that take a client-first approach understand. You should even ask your appraisers who they recommend for specific property types. Having peer referrals are helpful, especially in outlying areas where you have few approved appraisers.
Talk with your reviewers to evaluate which appraisers work best with your staff. Some appraisers may be excellent technicians with very good reports but are difficult to deal with. Consider its potential negative impact with your bank’s clients, the borrowers. Other appraisers may have average to good reports but have superior “soft skills” that your department finds appealing – communicative, responsive and professional.
Reduce your day-to-day headaches
Determine if your appraisal workflow system allows you to place appraisers in various buckets. Your workflow should also facilitate automation, including licensing and insurance expiration notification.
For example, you might put Appraiser “x” in the singular bucket of retail only in specific counties. You might get more granular and limit them to one county but only neighborhood shopping centers and restaurants. You might preclude them from valuing ground leases on outparcels, fast food restaurants and community shopping centers.
Determine who are the best appraisers for what property type and location. Significantly improve your odds of receiving the very best appraisals and reviews for your department. If done properly, it will likely result in less pushback from relationship managers. Put yourself in the driver’s seat.