How Long Does It Take to Dispute an Appraisal?
Understand the steps to contest an inaccurate property appraisal. Get insights into the process and how long it typically takes to resolve.
Property appraisals are a standard part of real estate transactions, providing an independent estimate of a property’s market value. While appraisers aim for accuracy, their reports can sometimes contain errors or overlook important details, leading to a valuation that does not reflect the true worth of a property. Homeowners and buyers have a right to challenge an inaccurate appraisal. Understanding the dispute process enables individuals to seek a review and potential adjustment of the valuation.
Gathering Information for Your Dispute
Before initiating an appraisal dispute, thoroughly review the appraisal report to identify any inaccuracies. Examine the report for factual errors such as an incorrect number of bedrooms, bathrooms, or misstated square footage. Verify that the property’s features and overall condition are accurately described, noting any improvements or upgrades that may have been overlooked by the appraiser.
Appraisals rely on comparable sales, often called “comps.” Scrutinize the properties the appraiser used, evaluating if they are truly similar in size, age, condition, and proximity to your property. Document any recent sales in your neighborhood that were not included but appear to be better comparables, focusing on those with similar characteristics and a close sales date.
Pay close attention to any adjustments the appraiser made to the comparable properties for differences in features, lot size, or condition. If these adjustments seem unreasonable or inconsistent, gather evidence to support your own assessment. Collect documentation for any significant property improvements, such as renovations, additions, or major system upgrades, that may have been missed or undervalued in the report. Organizing this information into a clear, concise format, highlighting the discrepancies and providing supporting documentation, strengthens your case for a reconsideration of value.
Initiating the Appraisal Dispute
Once you have gathered all relevant information and identified the specific issues with the appraisal, the next step is to initiate the dispute. The initial point of contact for an appraisal dispute, commonly known as a Reconsideration of Value (ROV), is typically the mortgage lender or broker who ordered the appraisal. They serve as the intermediary between you and the appraiser or the Appraisal Management Company (AMC).
You will submit a written request to the lender, outlining your concerns and providing the supporting documentation you have compiled. This request should detail factual errors, present more suitable comparable sales, or explain why certain adjustments seem unwarranted. Most lenders permit only one ROV request per appraisal, so ensure your submission is comprehensive. The ROV process must also be completed before the loan closes, making timely action important.
If the initial attempt with the lender does not resolve the issue, or if you suspect discrimination or bias influenced the appraisal, there are further escalation paths. You may contact the Appraisal Management Company (AMC) directly, as AMCs manage the appraiser panel and facilitate dispute resolution. As a final recourse, you can file a formal complaint with the appraiser’s state licensing board. Concerns about discrimination can also be reported to federal agencies like the Consumer Financial Protection Bureau or the U.S. Department of Housing and Urban Development.
Timeline for Appraisal Disputes
The timeline for resolving an appraisal dispute can vary depending on the complexity of the issues and the responsiveness of the parties involved. After submitting your Reconsideration of Value (ROV) request to your lender, they typically acknowledge receipt within a few business days. The lender then forwards your concerns and supporting documentation to the appraiser or the Appraisal Management Company (AMC) for review.
The appraiser or AMC is expected to respond to the ROV request within a short timeframe. This response will indicate whether the appraiser agrees to adjust the valuation based on the new information or if they stand by their original assessment. Following the appraiser’s response, the lender will communicate the final decision to you.
Should the dispute escalate to a formal complaint with a state appraiser licensing board, the process becomes considerably longer. Appraisers are given around 30 days to respond to a formal complaint. After this, the board conducts an investigation, extending the overall resolution time to several months or even up to a year. Factors such as the volume of complaints the board is handling, the complexity of the case, and the responsiveness of all parties can influence how quickly a resolution is reached.