TYPICAL MISTAKES BY APPRAISERS
By Kent Berk on October 26th, 2009 in BLOG
According to the FDIC, below is a list of some of the common errors by appraisers. These errors may be the basis for a lawsuit by the lender or borrower that relied on the appraisal, administrative action by the licensing authority and/or criminal charges.
- Conceals that the original client was the loan applicant
- Accepts a fee contingent on the appraisal obtaining a predetermined value
- Inaccurately describes improvements-overstates square footage and number of rooms
- Misrepresents the condition of property
- Fails to disclose extraordinary assumptions and hypothetical conditions (e.g. does not disclose that the estimated value depends on obtaining a change in zoning)
- Presents faulty analysis (e.g. uses appraisal methodology applicable for higher valued owner-occupied condos when the property is rental apartment units)
- Omits relevant information
- Includes misleading information
- Includes a series of material technical errors that will affect the credibility of the valuation
- Conceals that the original client was the loan applicant
- Fails to follow the Uniform Standards for Professional Appraisal Practice
