Lenders, financial institutions, attorneys, accountants and other professionals have a need for an appraisal on which they are relying to be reviewed by an independent, unbiased third party appraisal professional in order to analyze the quality, completeness, adequacy, consistency, relevance, appropriateness and reasonableness of the appraisal under review, as well as verify its compliance to USPAP (Uniform Standards of Professional Appraisal Practice). USPAP are appraisal standards by which all appraisers are required to practice and all appraisers are regulated on a national basis based on these standards of professionalism.
There are generally two types of appraisal reviews: Desk Reviews and Field Reviews. Reviews may be completed with a checklist format or a short narrative format, both of which would be combined with assumption and certification pages representing the Review Appraiser, per USPAP.
The Desk Review typically requires less time and effort (and therefore typically a lower fee) because it is performed in the office and does not require the Review Appraiser to visit the Subject Property (property being appraised) or to look at the comparable sales utilized in the analysis. The main focus of the review is the appraisal’s accuracy, completeness and reasonableness, as well as adherence to USPAP. On occasion, the client may request the review appraiser to make contact with the original appraiser to clarify or correct areas of the appraisal in order to make it more reliable and accurate for the client for the final appraisal product.
A Field Review is a more in-depth review process wherein the Appraisal Reviewer is asked to visit the Subject Property (externally only) of the appraisal and they may also be required to visit the comparable sales used in the analysis, depending on the needs of the client. This gives the Review Appraiser more insight to the appraisal for a clearer understanding of the data and analysis of the appraisal. This form of review appraisal was more common before online mapping, property photos, aerial photography maps and street view mapping were available online. Of course, due to the larger work requirement, the fee is also commensurate with the required work for this type of assignment. Upon the client’s request, this type of review may require the Review Appraiser to search the market to see if the best comparable sales were utilized in the appraisal report.