Pointers for Choosing a Commercial Appraiser
There are lots of commercial appraisal services nowadays, but finding the right one isn’t always easy. Besides, they’re not all created equal. So what’s a smart way to choose?
1. Define your need.
First and foremost, determine your purpose. Insurance placement? Company expansion? Tax dispute? Different appraisers specialize in different areas.
2. Check qualifications.
The Internal Revenue Service (IRS) requires appraisers to be “Qualified,” which means the appraiser should perform appraisals like the subject assignment as his/her main profession, no matter their licensure or certification.
3. Interview potential appraisers.
When interviewing a prospective appraiser, you have to specifically look into whether they are qualified for the job. That means asking for their resume and checking their listed experience. You should also ask for recent work samples as proof of their knowledge and competence. In addition, know what methods they use in their appraisals.
It’s good to pick an appraiser who can patiently explain what they do and the concepts involved. At the same time, pay attention to the questions they throw at you concerning the assignment. Just by the things they want to know, you can easily see through an appraiser’s level of commitment.
4. Choose someone who offers full disclosure.
Definitely, your appraiser must offer full disclosure, including lack of knowledge on the subject, any interest they may have in the subject property and whether or not they have performed an appraisal on said property within the last three years. Overall, the appraisal should be unbiased, and full disclosure lets you determine whether you are better off choosing another appraiser.
When hiring a commercial appraiser, you have other things to look into, such as:
> Experience in litigation
You can never rule out the possibility of litigation. The appraiser should be willing to provide support and available for consulting or for conferences. If necessary, they should have the ability to defend their work legally.
Appraisers either collect a fixed rate or a per-item or per-hour fee. Watch out for those who charge a contingency fee based on the final opinion of value. This is, in fact, a violation of the Uniform Standards of Professional Appraisal Practice (USPAP)’s code of ethics.
Lastly, before you request a bid from an appraiser, they have to know whether the subject property is vacant, leased or owner-occupied. As well, they have to ask what the appraisal is for. This will help them identify the needed property right to appraise and examine the work scope when giving an accurate bid.