appraiserlogoI have long been a critic of the current Appraisal system. There can be no doubt as to the corrosive and corrupting influence of Real Estate Agents and Mortgage Brokers on the process.

As noted earlier (Home Appraisal Reform: WSJ vs NYT) the changes effected by Fannie Mae in settlement with Andrew Cuomo are prompting a fresh look at the issue.

Query:  What experience do people have with State Appraisal Boards? It seems some states actually randomly assign appraisers, while others merely license and oversee them. For any local readers, what is the differences between the way things are run in states such as Nebraska, Texas, Arizona, Louisiana and Oregon?

Anyone with experience care to comment on these?

See also:
Alabama Real Estate Appraisers Board

North Carolina Appraisers Board

Georgia Appraisers Board

New Jersey Consumer Affairs

Category: Real Estate

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

10 Responses to “Appraisal Boards, Reviews and Random Assignments”

  1. Ned Bushong says:

    In Ohio, you have to pass a fairly rigid test, to become an appraiser. This was initiated after the S&L theft. But, during the housing bubble, all appraisers simply ignored the rules.

  2. call me ahab says:

    the way it has played out is that loan officers can no longer request appraisers and can have no contact with an appraiser re value-

    appraisers are assigned by the bank- an appraisal can be reviewed by the bank if some comps are in question- whether considered too high or too low- and a review appraisal can be done- and sometimes a whole new appraisal is requested and given to a different appraiser- but the loan officer is no longer inthe mix-

    also- an underwriter always has the right to question an appraisal- that has always been the case

  3. Morris says:

    Arizona—-The board is there to enforce appraisal guidelines, be it USPAP(Uniform Standards of Professional Appraisal Practice) or state guidlines. I would add that in my experience, they are way to lenient, on rule breakers and incompetence..could be persons on the board are not as impartial as they need to be. I don’t know of any state boards who assign appraisers???

  4. Ned Bushong says:

    >>- an appraisal can be reviewed by the bank if some comps are in question-<<

    Ah ha! Therein lies the problem. Comps are only a small part of the appraisal process.

  5. Avl Dao says:

    I can’t speak to those 4 particular states, but back in Illinois where I did commercial lending in Chicago, I often caught gobs of out-dated copy-n-pasted sections in the reports for commercial loans. Evidently I was one of the few who actually “read” each page of the reports.
    Often times the appraiser had no idea how erroneously the copied-n-pasted info was; oft times it was lifted from aged appraisals performed by a different staffer in their office or was from a different part of the city that had streets with similar names.
    These were not isolated incidences..
    I’d have to point out that the undeveloped urban lots they referenced had been developed after all; the grocery store cited had long relocated; that streets cited didn’t actually exist in the part of town in question.
    I think they felt clients equated the accuracy of the report by #-of-pages contained.
    I ended up challenging the amount of fee and admonishing them on the likelihood their short-cuts could be seen as a sign that the overall analysis was flawed.
    And all that was before we’d get to the fights over valuation methods.
    I read everything and I would put them ‘through their paces’ when the work seemed shoddy.
    No surprise, though, that Chicago is so so so overbuilt in places…and home to Corus Bank.

    On the plus side, I thought the guy who appraised my condo for a refi (w/Countrywide B4 they fell to the ‘dark side’) did a very thorough job including re-measuring key inside dimensions against what was on file.

  6. call me ahab says:


    please elaborate further-

    there are other ways to value property of course- such as the income approach- however-recently sold comparable properties is what is generally used to determine value-

    trying to understand your thoughts re this

  7. dussasr says:

    I’m in Indiana – the state just licenses them here. Nothing special.

  8. Ned Bushong says:

    call me ahab Says:

    There are 3 methods to appraisal, 1)comparable sales, 2)income approach, 3)replacement value approach. Each method should be given equal waiting, evidence provided, and a summary report from each. When finished, there should be no more than a 10% variation between each methods finding. If so, something is wrong. In this past cycle, most appraiser looked only at comps, and just kept chasing prices up the ladder. They should be jailed.

    I know what I’m talking about, almost 30 years in the biz.

  9. call me ahab says:


    thx for the feedback-

    on residential appraisals- at least in the Washington DC metro area- you get a value based on comps and you get a replacement value-

    income approach is not used- nor is it required by Freddie/Fannie- i was under the impression income apporach is more applicable to commercial property-

    i have done investment purchases in the past but cannot remember if the income approach is used on the appraisal-


  10. Linas says:

    State appraisal boards, as currently operated, are a significant part of the problem. They are underfunded, understaffed and are totally incapable of regulating the appraisal industry. In Illinois, appraisal licensing fees ($500 every 2 years) are rolled into the State’s general fund, leaving the state board with two full-time employees. Regardless of how well-intentioned and hard working the board is, they cannot function effectively without funds and personell.