All Forum Posts by: Patrick Britton

Being an appraiser can help your real estate investing business enormously. It's also a fantastic career, if you can get into it. And that's the problem; the insurmountable problem facing anyone interested in becoming an appraiser today.

Unfortunately, it is (for all intents and purposes) completely and totally impossible to become an appraiser. The way one would become an appraiser is to take, depending on your state, 75 to 80 hours of pre licensing education, pass a couple of super easy tests and then you'll need to find a certified residential appraiser willing to take you on for at least six months, usually it's two or three years, in order to gain the required work experience hours.

The problem is finding a certified residential appraiser willing to bring you on as a trainee. unfortunately, appraisers have absolutely no incentive whatsoever to bring on new trainees. Training someone new takes a lot of time, a bit of money, and can create a lot of stress. It's not worth it.

The primary governing body of the real estate appraisal business is the appraisal foundation and the appraisal qualifications board. Both of these institutions are totally useless to existing appraisers and have done nothing but damage the process by which new people become certified appraisers.

So while it is a very good idea to become a real estate appraiser part time, I would simply remove this option entirely.  

In retrospect, I should have personally gone the home inspection route...

@Jacob Paulson  speak with Mark Ainley with GC realty & development.  @Mark Ainley

Fees for appraisal services are all about supply and demand.

A lender will order an appraiser through an AMC. The AMC will blast out the required turn time and fee to a whole slew of qualified appraisers (most appraisers cannot do VA, FHA or larger MFR, etc.). Appraisers bid on the job and eventually someone will be chosen.

Since the market is insane and there are so few appraisers, prices/fees skyrocket. This is good ole’ fashioned free market capitalism at work.

Appraisal waivers seem to offer a modest solution to a massive problem. My suggestion?  Contact your congressperson and demand a total and complete overhaul of the appraiser industry.  There’s no reason why a highly experienced realtor should NOT be allowed to do appraisals. 

As a limited licensed appraiser in Michigan I would try to dissuade anyone from trying to become residential real estate appraiser.  It is so monumentally difficult it might as well be considered impossible quite frankly.

@Alfredo Villegas  house/property photographer.  listing sign and sign post installer.  blogger/vlogger/writer (real estate related).  transaction coordinator.  loan signing agent or mobile notary.  assistant to appraiser, RE agent, MLO, home inspector, etc.  

@Phillip Rosin  providing your lender with an estimate of market value really doesn't serve any purpose.  They will order an independent appraisal and unfortunately, based on some things you've stated, you might be in a market that's very difficult to appraise.  so be prepared to be disappointed.  Most people forget that the appraiser's CLIENT is the lender, not the borrower.

It might be a good idea to reach out to a couple of appraisers in your area because lots of replies to your post contain incorrect info.  Most realtors and even most lenders and underwriters have no clue what process appraisers are required to follow.  Better to get info directly from the source vs. some other's opinion 

@Roy Peer  The biggest problem is that everything hinges on the appraisal. So yeah, I think you're crazy :)  you're also assuming the current insanity continues and prices continue to go up and up and up.  

All should be very aware that if the ARV you want is for lending purposes you should speak with a local appraiser, not realtor. ARV for flips can be derived from a realtor's CMA with less risk.

@Rick Harmon "We don't want to be combative but these buyers have been flaky since the beginning with low communication and response times. And feel they are just looking for an excuse to back out or ask for a lower price. We had an offer of $75,000 more that was a financing offer but we took this one because it was cash and would not to meet the appraisal standards."

I think you're absolutely right.  Here's what I can foresee:  they get an appraisal, realize it's $150,000 (or some massive number) less than contract price, decide to forgo earnest money and cancel the deal.  

If you're closing in two weeks they can wait.  In the meantime, you might want to get your realtor to ask other offerors if they'd still consider buying at current contract price.  

@Issy Mercado  "Tax appraisal is $40k, Propstream values it at $65k, and comps for other 2/1's are about $92k. The town itself is very rural, about 1k residents"

Nothing against propstream but in this case I would give it almost no credibility. Tiny towns like that present a number of problems to anyone or anything attempting to determine value. In fact, I might even argue that if you cannot find at least comparable sales in the past 12 months you should seriously consider investing elsewhere. If there aren't very many comparable sales, an appraiser might arrive at a very different opinion of value to yours.