Is it Safe to Say ANYTHING to an Appraiser Anymore?

Recently an Iowa REALTOR® member settled a hearing set against him brought by the Iowa Real Estate Appraisal Examining Board.

The “troublesome”  statements to the Appraiser were:

1. Prior to the appraisal …“good luck, I don’t think you will have too much difficulty making this one”…

2. After it did not appraise  …“This deal will not come together, sometimes YOU do not realize just how much Power they give you clowns”…  

3. And “…How is it that (name of bank) Bank did the same appraisal 2 months ago and it appraised. Does this have something to do with the Lender not wanting to do the loan or something? Or could it be that you’re new to this business.  There were plenty of comps out there to make this happen. The repairs, not so much a problem.”
The Iowa Real Estate Appraiser Examining Board said this was an attempt to “improperly influence” the appraisal.  They had originally proposed a $1,000 fine to this REALTOR® member.

More background: this Appraiser lived in a small town, not really in the market and was more or less a “part-time” Appraiser. The REALTOR® originally filed a complaint to the Examining Board related to competence issues he truthfully believed about this appraiser, and who he had heard similar complaints by others about this particular Appraiser.  As part of that “investigation”, the Appraisal Examining Board came across these email statements and then, on their own, brought the Statement of Charges.

Do you see any type of “undue influence” in these statements? IAR leadership doesn’t. Don’t you think YOU would make these “normal” type of business comments to an Appraiser, especially when you are frustrated – particularly when it recently did appraise for the sales price just two months earlier?   

The general authority for the Appraisal Examining board to have jurisdiction over a person who is not an Appraiser is more commonly for (1) coercion, (2) extortion, or (3) bribery.  

Note: a REALTOR® does not violate the code solely by asking an appraiser to consider additional, appropriate property information, or to provide further detail, substantiation, or explanation for the appraiser’s value conclusion, or to correct errors in the appraisal report. 

So where does that leave you as a REALTOR® in relation with an Appraiser on a property? It appears to be related to how “sensitive’ the Appraiser/Appraiser Examining board is. Is it best to talk to only those “tried and true” appraisers you have conducted business with for some time?  Likely, as learned here, – YES!  
Will it be more difficult for some Appraisers? YES.

But would you rather not be subjected to a $1,000 fine for “common everyday business language/feelings” you might express to the Appraiser. Yes. 

Since the implications of the Appraisal Board actions have effect statewide, the Iowa Association of REALTORS® assisted financially with this REALTORS® legal defense. He agreed, to keep the litigation costs low and to avoid more general administrative and bureaucratic pains, to settle and accept a fine of $250. Note: the Appraisal Examining Board found no cause to discipline or further investigate the complained about Appraiser.


Originally printed in the Spring 2017 Edition of Benchmark Magazine.

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