These services can provide you with a lot of valuable information if utilized correctly. However these sources are not as reliable as a complete appraisal performed by Area Appraisal Services, Inc.
Why can't we get a quick "Value Check" or a "Comp Pulled"?
Appraisers are governed by the Uniform Standards of Professional Appraisal Practice, or USPAP. Among the many restrictions of USPAP is one that prohibits appraisers from accepting an assignment to appraise a property based on a predetermined value or range of value. So for example, if an appraiser does a comp check to find out if a home will appraise for at least a certain amount and it will, he or she cannot then accept the assignment to do the actual appraisal from you. In performing a comp check, he or she by definition has actually already performed a type of appraisal and must maintain complete records showing how and when they arrived at the figures they quoted you in the comp check. The logic of this USPAP rule is to prevent dishonest appraisers from being tempted to over-appraise properties, combat predatory lending practices, and prevent fraud in the market place. Do you want any documents showing you were asking for a comp floating around? This is construed as Mortgage Fraud.
Appraisers understand...why a check of a properties value is wanted before proceeding with the appraisal and are not insensitive to your needs, but legal issues and business practicality make free comp checks by an appraiser next to impossible. The recommendation above should provide you with the answers you need to feel comfortable in ordering an actual appraisal.
This communication by the Appraisal Standards Board (ASB) does not establish new standards or interpret existing standards. Advisory Opinions are issued to illustrate the applicability of appraisal standards in specific situations and to offer advice from the ASB for the resolution of appraisal issues and problems.
SUBJECT: Unacceptable Assignment Conditions in Real Property Appraisal Assignments
APPLICATION: Real Property
All real property appraisal assignments involve conditions that affect the appraiser’s scope of work and the type of report. What types of assignment conditions are unacceptable?
Many residential property appraisers report requests for service where the caller includes statements or information in the request similar to the following:
We need comps for (property description) that will support a loan of $___________; can you provide them?
Sales Price: ___________.
Approximate (or Minimum) value needed: __________.
Amount needed: ______________.
Owner’s estimate of value: ___________.
If this property will not appraise for at least ___________, stop and call us immediately.
Please call and notify if it is NOT possible to support a value at or above ___________, BEFORE YOU PROCEED!!!!
Appraisers report that the caller usually makes it clear that they do not want the appraiser to do any fieldwork. Some callers refer to the service requested as a "comp check" while others refer to it as a "preliminary appraisal" or use some terms other than appraisal (such as preliminary evaluation, study, analysis, etc.). Some callers indicate that if the numbers will not work, the appraiser can send a bill for research services or a "preliminary" inspection. Other callers promise future assignments if the appraiser can make the present deal work.
Appraisers ask, "Can I respond to such requests without violating USPAP and, if so, how?" See above as to what Area Appraisal Services, Inc. can provide.
To learn more about USPAP (Uniform Standards of Professional Appraisal Practice) please go to www.appraisalfoundation.org