So you find yourself needing to have a real estate appraisal performed by a certified appraiser in order to obtain a loan for a purchase transaction. Here are a few things you should know:
As defined by the Uniform Standards of Professional Appraisal Practice (USPAP), the Client is
The party or parties who engage, by employment or contract, an appraiser in a specific assignment. “1”
Federal banking regulations require that a “financial institution” actually order the appraisal and thus be the Clientof the appraiser. This is an important distinction to note. Yes, you are paying (the bank) for the appraisal, however you are not the Client – the bank is. An appraisal for a federally related transaction (basically a real estate loan at/above $250,000) must be prepared directly for a financial institution. The Interagency Appraisal and Evaluation Guidelines state:
“1” The Uniform Standards of Professional Appraisal Practice, 2014-2015, published by the Appraisal Foundation, Page U2