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A staff appraiser evaluates real estate for lending purposes. These finance professionals determine the value of a property so a bank can decide how much money it wants to loan on a mortgage or home equity loan. In many regions, it is necessary to have a license to work as an appraiser. Regulations can vary and it may be advisable to check job listings to see what kinds of qualifications employers expect when preparing to become a staff appraiser.
Before a bank will originate a loan, it may request an appraisal of the property. Large banks maintain a staff to perform this function, rather than contracting out the job to a third party. A staff appraiser may choose to concentrate on particular types of property, such as land, single family dwellings, or commercial real estate. This specialization can improve the quality and accuracy of appraisals for the employer.
The staff appraiser collects documentation on the property to check for common problems, like a cloud on the title that might cause delays in the sale. Appraisers also visit the property for a physical inspection and may hire an inspector for an in-depth evaluation if this appears necessary. They can take note of the location, physical condition, and characteristics to start developing an estimate of the value. It may also be necessary to consult comparable homes to determine their current market value.
“Comps,” as they are known, show how much properties of a similar type sold for in recent months. They allow a staff appraiser to test the market and base an appraisal on what people are actually paying, rather than an arbitrary valuation. Homes should be in similar neighborhoods and must be comparable in terms of condition, lot size, and features. A three bedroom home in good condition in a bad neighborhood, for example, is not comparable with a two bedroom home that needs work in an excellent neighborhood.
Familiarity with local real estate and the community is important for a staff appraiser. Newcomers to an area may not know where the dividing lines between different communities lie, for example, or might not be familiar with issues commonly found in structures in that region. Staff appraisers may subscribe to real estate magazines, track sale declarations at a title recorder’s office, and use other tools to keep up with the market. If their appraisals are incorrect, the consequences could be costly for their employers.