Episode 026 - Are Appraisers the Devil? PART 1
Are you a Netflix binge-watcher? Then, we have a 3-part binge-listening opportunity for you. Welcome to our 3-part series, which is all about how to more effectively price properties. We also dive into understanding more about the appraisal process.
In Part 1, we give you tips on working with the appraiser and providing information about rules and guidelines that they must follow. Those “rules” are often misquoted, misunderstood, or sometimes flat out wrong.
Be sure to watch our accompanying breakout episode where B explains why the "price per square foot" method to valuing property is incorrect. You don’t buy cars by weight, why are you selling homes by their size?
No, appraisers aren’t the devil! They provide a service. Understand how the appraisal process works and what is expected, and you'll have better results in next appraisal.
SHOW NOTES
- 01:47 – Are appraisers the devil? Angel agents represented by “angelic” Cate.
- 03:30 – Song of the podcast, “Devil Inside” by INXS.
- 04:13 – B’s own “side note tangent” (not stealing Cate’s theme song); best High School party ever: "Downstairs at B’s".
- 06:00 – B is an appraiser is definitely not the devil…unless you mean devilishly handsome.
- 06:10 – Appraisers are not out to get agents or “kill the deal”. B admits appraisers go to evil appraisal school.
- 06:48 – What makes agents mad is the misunderstanding and lack of knowledge in the processes and expectations. All professionals have rules and requirements. Let’s talk about those.
- 07:42 – An appraisal is an OPINION of value. Appraisers work for a client, typically the lender, and is used for the underwriting purposes to judge the collateral for the loan.
- 08:50 – Cate: pass along this information to the client (buyer, seller). Appraisal is for the lender.
- 09:15 – Value is based upon what the greatest number of buyers, not what one buyer will pay for it. Not just what your buyer thinks.
- 10:25 – Cate: The lender doesn’t care about your client’s opinion. The “golden rule”.
- 10:36 – The appraiser has to “sell” the report to the underwriter/lender. They can write a report with the number everyone wants, but if the lender doesn’t believe it or find it credible, your clients won’t get the loan.
- 11:20 – Cate: had this happen to her. Appraisal met the purchase price, but the lender didn’t like the report and threw out the report.
- 12:08 – Christian: big multi-parter
- 12:40 – Can you talk to the appraiser? YES you can! There is a “good” time and a “bad” time. Know the difference and use it to your benefit. The good time is before the report is written and transmitted to the client (lender). Bad time is after that event.
- 14:10 – Cate: Side Note Tangent, Cate and B’s first meeting set the tone for the rest of their relationship…B came in “low” on one of her listings. Appraisal came in at “market value.” Christian is seeing the healing.
- 16:55 – How to communicate with an appraiser? BE NICE! You get more flies with honey than you do with vinegar. Don’t come at the appraiser with anger.
- 17:49 – Use kind words, but also bring helpful data. Give your thought process. Give evidence. Appraisers are not interested in your opinion without something to back it up. Only providing comps is not enough. You don’t like what the appraiser has done, explain why.
- 18:50 – Christian: flies and honey went out the window. Appraisers really are the devil.
- 19:07 – Cate: back up your data. Tools are available to run stats and analyses. Trend analysis.
- 20:00 – Christian understands that appraisers are human too and have feelings. If only Cate understood. Sigh…
- 20:50 – Rule vs. Guideline issues. Most of the time rules are NOT rules but rather they are guidelines, such as time and distance parameters.
- 22:15 – “I can’t use that comp.” is usually meant that the appraiser doesn’t “want” to use it, not that that they “can’t” use it.
- 22:35 – Cate: lender may have a rule or guideline so keep that mind as that can affect the appraisers work process and comp selection.
- 23:00 – BREAK OUT: Don’t use price per square foot for your valuation. We don’t buy cars by weight. Don’t sell your homes by size.
- 24:40 – Pretentious Porsche lovers vs. Camaro guy.
- 25:27 – Inspiring quote: Where there is no knowledge, there is no value.”
- 26:10 – Appraisers really are saint-like. Understand the appraisal process. Knowing the good and bad time to talk with the appraiser. Communicate useful information to the appraiser. Know appraisers must “sell” their report to the lender.
- 27:05 – Closing, part 2 is next week. Make your day legendary!
SHOW LINKS
BETWEEN THE LINES LINKS
Email
brian@brianclee.com
cate@craftsmanrg.com
Web
brianclee.com
catelee.com
realestatebetweenthelines.com
Facebook
https://www.facebook.com/groups/realestatebetweenthelines/
https://www.facebook.com/Brian-C-Lee-111822417027919/?
YouTube
https://www.youtube.com/channel/UCcv4dHU39-b5_QVVCIhbcBA?
