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3 Capabilities to Demand from Your Appraisal Partner

As the mortgage industry shifts to a purchase-oriented market, more lenders we talk to are looking for a partner they can trust to deliver quality appraisals on time. But how can you tell who to trust?

We’ve outlined three capabilities an appraisal company must have to ensure a smooth purchase appraisal process. If you’re in the market for a new appraisal partner, we highly encourage you to look for the following characteristics.

1. It’s Not Just About Timeliness

When it comes to appraisals, timeliness isn’t everything—but it sometimes feels that way. Today’s mortgage transaction involves a lot of moving parts and deadlines. No one wants to miss a closing date, yet sometimes things happen that are beyond anyone’s ability to control.

That’s why transparency is critical in an appraisal partner. But what exactly is transparency, anyway?

Transparency means there are no surprises. In our business, transparency is created through proactive communications structure that keeps the client informed from the time an order is taken until the report is delivered.

 

For example, when Valuation Partners receives an appraisal assignment, the listing agent for the property is contacted as soon as possible to schedule an inspection. If viewing the property is delayed for any reason, the lender is notified and told why.

 

The same approach applies to every stage of the appraisal process. If it affects the outcome, the client is told. After all, surprises might be nice on your birthday, but not when it comes to an appraisal.

 

2. A New Definition for Quality

 

While quality seems like a no-brainer, there is much more that goes into producing a quality appraisal than the actual value. Quality begins with selecting a qualified valuation expert whose certifications, E&O insurance and past performance are checked and rechecked before the report is delivered. Quality is also created when the appraisal partner does its homework to understand the characteristics of the property, which eliminates any surprises at the time of inspection.

 

Quality means being provided assurance that the final value was determined without bias or outside influence, and that the data on which it was based was not misrepresented. And more recently, quality means knowing why an appraisal scored high for risk through Fannie Mae’s Collateral Underwriter or the FHA’s EAD portal—and being able to correct it, if possible.

 

3. Geographic Proof

 

You would be surprised how often we hear stories about assignments being completed in areas in which the appraiser had zero experience. On the other hand, how do you really know whether the appraiser performing the assignment knows the local market?

 

Simply put, your appraisal partner should tell you. At Valuation Partners, we leverage technology to select and validate an appraiser’s market knowledge before assigning the order. Prior to accepting the order, the appraiser will acknowledge the distance between his or her office and the property is correct and that they have the necessary data to perform a satisfactory report. When the appraisal is submitted, we provide an Appraiser Proximity Certificate that verifies and even maps the appraiser’s geographic competence.

 

I can’t really put into words how important these three capabilities are to an effective purchase appraisal process. Each one is individually critical. Find the partner that can master all three, and you have partner you can count on.