Valuation Management Group, working as an appraisal management services partner for banks, credit unions and mortgage brokers, completes appraisal reviews nationwide. We see many common omissions and/or errors in appraisal reports.
We thought it would be helpful for us to share some of the more common errors or omissions that VMG encounters to assist our partners in providing acceptable appraisals and avoiding revision requests.
One common item is the Fannie Mae finding that indicates the appraiser has reported either a different condition or quality rating in another appraisal report. Per UAD, Condition and Quality ratings should be on an absolute basis and the quality and condition rating of a comparable should not change unless there are details provided after the completion of a report. If an appraiser receives information that causes one of these ratings to change, the best solution is to note in all reports going forward why the condition or quality rating has changed.
Other common revision requests are as follows:
- No support or explanation for adjustments being made
- Missing reconciliation to value comments
- Prior transfers of the subject and comparables are not analyzed by the appraiser
- Zoning not confirmed and/or explained
- No explanation on the highest and best use analysis. For commercial reports, improper development of the four tests of highest and best use for both the “as though vacant” and “as is” scenarios.
- Comments within the report that are no longer applicable or conflict with the actual report
- Photos mislabeled
- Lack of support for the site value
- Reference to outdated versions of USPAP and/or not complying with the current version of USPAP
Valuation Management Group is responsible for ensuring that appraisers are delivering quality appraisal reports. Verifying that the report is complete and supported prior to delivery to us will limit the number of underwriting and review revisions needed.
Valuation Management Group is a national, full service appraisal management service company that manages the appraisal process for banks, mortgage bankers and credit unions. We offer the full array of commercial and residential appraisal products and services. We take the appraisal process from ordinary to extraordinary.