Can You Appeal an Appraisal? Here’s How to Do It

A real estate appraisal provides an opinion of a property’s value. This valuation serves a primary purpose in transactions such as home purchases, refinances, or home equity loans, ensuring the loan amount aligns with the property’s worth. Appraisals offer protection for lenders by securing their collateral and for buyers by preventing overpayment. As an opinion of value, an appraisal’s findings can be reviewed or challenged.

Grounds for Appealing an Appraisal

An appraisal can be challenged for inaccurate valuation. One common reason involves factual errors within the appraisal report. These errors might include incorrect details about the property, such as the number of bedrooms or bathrooms, the total square footage, lot size, or other material facts regarding the property’s condition or features.

Discrepancies in the comparable sales (comps) selected by the appraiser also form a basis for appeal. Appraisers typically use recently sold properties similar in size, age, condition, and location to determine value. If the comps are not truly comparable due to significant differences or outdated sales dates, the valuation may be skewed. An appraiser might also misinterpret current market conditions or overlook recent shifts that affect property values. Failing to account for recent improvements or renovations can also lead to an undervalued appraisal.

Preparing Your Appraisal Appeal

Preparing an appraisal appeal requires a review of the original report and gathering evidence. Obtain a copy of the appraisal report from your lender or the relevant party. Examine every detail within the report for factual inaccuracies, inconsistencies, or omissions, paying close attention to property characteristics and public records.

Gather documentation to support your appeal. This includes identifying alternative comparable sales that accurately reflect your property’s value and are in the immediate vicinity. These comps should be similar in type, size, age, and have recent sales dates, ideally within the last six months.

Collect property-specific documentation like permits for improvements, invoices for renovations, or photographs of upgrades. Tax records or blueprints can also correct factual errors. Market data, such as recent neighborhood sales trends, can strengthen your argument. Organize all collected evidence, highlighting specific discrepancies and providing supporting documentation for each point.

Submitting Your Appraisal Appeal

Once all necessary information and documents have been prepared, formally submit your appraisal appeal. For most transactions, the appeal is submitted to the lender or the Appraisal Management Company (AMC) that ordered the appraisal, rather than directly to the appraiser. The AMC acts as an intermediary, managing the appraisal process and ensuring compliance and quality.

The method of submission can vary, including online portals, email, or certified mail. Adhere to specified deadlines, often 30 to 45 days from receiving the original report. Keep records of your submission, such as delivery confirmations, to confirm receipt. Some lenders or AMCs may provide specific forms; complete these accurately, focusing on case numbers and borrower information.

After the Appeal is Submitted

After submitting your appraisal appeal, a review process begins. This review is conducted by the original appraiser, a different review appraiser, or the lender’s internal appraisal department. They will examine the evidence you provided against the original appraisal, often seeking clarification or additional details.

There are several possible outcomes once the appeal has been reviewed. The appraiser may agree with the evidence presented and revise the appraisal value, which would then be used for your transaction. Alternatively, the appraiser or reviewer might determine that the original appraisal is accurate and no revision is warranted, providing a justification for their decision. In some instances, the appraiser or lender may request further clarification or additional documentation from you before making a final determination. You can generally expect to receive a decision regarding your appeal within a few weeks to a few months, depending on the complexity of the case and the volume of appeals being processed. If the appeal is successful, the revised appraisal value will proceed with your transaction. If the appeal is unsuccessful, the original value stands, and you may need to consider other options related to your real estate transaction.