What is appraiser pressure?
This post is all about what not to say to the appraiser… and also what you can say to get your point across.
There’s a fine line between informing the appraiser and appraiser pressure.
Today I am giving you all the tips to avoid appraiser pressure while sharing the important facts about the property to be appraised.
Once you know how best to communicate with the appraiser, your appraisal process should go much smoother for you.
This post is all about what not to say to the appraiser… and also what you can say to get your point across.
What is Appraiser Pressure?
According to The Appraisal Institute: Appraiser pressure is defined as a mortgage lender, broker, or a real estate agent or broker pressuring an appraiser to reach a certain value in conjunction with an appraisal of real property.
Appraisal pressure can also be received from homeowners, home buyers, appraisal management companies, really anyone who has a stake in the result of the appraisal.
Many times, the person applying the pressure doesn’t even realize that what they are doing is totally against the rules.
Here are the rules: DODD-FRANK WALL STREET REFORM AND CONSUMER PROTECTION ACT (page 813) SEC. 1472. APPRAISAL INDEPENDENCE REQUIREMENTS.
According to Dodd-Frank the following is a violation: “A person with an interest in the underlying transaction…attempts, to compensate, coerce, extort, collude, instruct, induce, bribe, or intimidate such a person, for the purpose of causing the appraised value assigned, under the appraisal, to the property to be based on any factor other than the independent judgment of the appraiser.”
Tips to Avoid Appraiser Pressure
First, I want to be clear, realtors are some of my favorite people.
I have lots of fun conversations with realtors, appreciate their insight, and I am super grateful for my connection with realtors.
Same goes for homeowners…. we are all just people, after all.
So the following tips and information comes from a place of wanting to improve communication, nothing more than that 🙂
This is a topic that is important to talk about because pressuring the appraiser can result in circumstances you will want to avoid, such as prolonging the appraisal process…. because must appraisers will bail if they feel pressured…. then you’ll have to find another one.
And, if you are a realtor pressuring the appraiser then you run the risk getting yourself into hot water.
I would love to help you make the process much smoother while still being able to provide the necessary information to the appraiser.
Below are some questions and statements that you’ll want to avoid along with suggestions for how to rephrase it in a way that is acceptable.
Some are subtle and others are bold…
What Not to Say
- Is it going to make value?
- Here are the sales you should use.
- I’ll be happy if it appraises at $$$ price.
- Could you work some magic for us here?
- I need the value to be as low as possible.
- I need the value to be as high as possible.
- Please just do your best to hit the sales price.
- We really need you to bring this in at $$$ price.
- I am going to lose my house if you don’t bring this in at $$$ price.
- It’s been such a difficult year and I just need this appraisal to work out for me.
- The last appraiser killed the deal, so if you could please just do your best with this one.
- The buyers have lost out on so many houses, we really need this one to work.
Say This Instead
- Here are a few sales that may be helpful. I wrote notes on them explaining why I think they are helpful.
- This is a list of improvements that have been completed recently.
- Here is a list of all of the offers we received, prices and contingencies are included.
- The reasons why people like to buy in this neighborhood. (ex: school district, golf course, hiking trails, etc)
- What has been happening in the neighborhood that affects market value.
If you’ll notice the major differences between the 2 lists above…
The first list includes a lot of emotions.
And the second list focuses on facts about the house or the neighborhood.
That’s because the appraisal must be unbiased and well-supported by facts.
RELATED POST: How to Prepare for a Home Appraisal
With that said, we aren’t all business over here at Zen Appraisals.
We love chit chatting and getting to know people.
And often, I will talk with clients and realtors about lots of fun or interesting stuff that we have in common.
I have learned a lot and also made many new friends that way – That’s the bonus part of our job!
This post is all about what not to say to the appraiser… and also what you can say to get your point across.
