Who Orders the Appraisal?

Buyers and sellers alike often have questions about the appraisal process.  Sometimes, we’ll have a home seller who offers up an existing appraisal on their home in the hopes of speeding up the process or ensuring that the value contained in it is used.  They are usually disappointed when we tell them that it can’t be used.

Lenders today are being very conservative with appraisals to be sure that they are not taking on collateral that is not worth the mortgage note that it secures.

As part of the loan approval process, the lender will assign someone from their approved appraiser list to provide their opinion of the value of the home being purchased.  In 2008, the guidelines for how appraisals are ordered was changed to avoid any undue influence on the values given for homes.  HVCC (Home Valuation Code of Conduct) rules state that only the lender can order an appraisal on a property – not the owner, not the REALTOR and not even the mortgage broker that may be facilitating the loan.

Once the appraisal is complete, a copy is furnished to the lender, who is responsible for making sure that the buyer also receives a copy of the report – after all, buyers are being charged for it in their closing costs.  While home sellers always want to know the details of the appraisal, that information is confidential and is not shared with anyone on the selling side of the transaction unless the appraised value comes in lower than the purchase price.

Still have questions? Call us at 504-327-5303. We know stuff and we’d be happy to share that knowledge with you.