What Is a Desk Review Appraisal?

Real estate appraisals provide an objective assessment of a property’s value, important for various financial transactions like buying, selling, or securing a mortgage. A desk review appraisal is a specific type of appraisal review that evaluates a property’s worth using existing information and data, without an on-site inspection. These reviews are a common tool for assessing collateral and serve as a means of quality control, verifying the accuracy and compliance of an appraisal report.

Understanding Desk Review Appraisals

A desk review appraisal involves an appraiser developing an opinion about the quality of another appraiser’s work, such as a report or work file. Its primary purpose is to determine if the original appraisal report contains relevant data, employs appropriate standards, and reaches a reasonable conclusion. This review is performed in an office setting, making it a more time and cost-efficient option than appraisals requiring physical property visits. Financial institutions and attorneys frequently request desk reviews for a second opinion, ensuring credibility and mitigating risk.

Common uses include pre-funding reviews before a loan closing to prevent issues from flawed appraisals. Post-funding quality control sampling reviews are another typical use, often conducted to satisfy bank regulators who require a sampling of appraisals on closed loans. These reviews help identify weaknesses in risk management systems or pinpoint inaccurate appraisal practices. Desk reviews are also utilized in loss mitigation or foreclosure scenarios, providing lenders with helpful information for managing delinquent accounts.

Data Utilized in a Desk Review

A desk review appraiser relies on existing documents and information to assess a property’s value without a physical inspection. This includes the original appraisal report, which serves as the primary document under review. Reviewers then cross-reference this information with external data sources to verify its accuracy and completeness.

Key Data Sources

Public records, such as deeds and tax assessments, provide foundational information about the property’s legal and financial history.
Multiple Listing Service (MLS) data offers details on recently sold properties similar to the subject property, including listing sheets and photos.
Online mapping tools and aerial photographs provide visual context for the property’s location and surroundings.
Prior appraisal reports and building permits offer historical data and insights into property improvements.

The appraiser must ensure the credibility of all information obtained, often verifying data through multiple sources to enhance reliability.

How a Desk Review is Conducted

The process of conducting a desk review involves several analytical steps performed by a qualified appraiser. The reviewer begins by thoroughly reading the entire appraisal report under review. This allows the reviewer to grasp the original appraiser’s methodology, reasoning, and conclusions. The Uniform Standards of Professional Appraisal Practice (USPAP) provides the framework for ethical and competent appraisal work.

The reviewer then performs data research and analysis to determine the appropriateness and accuracy of the data presented in the original report. This involves checking for compliance with appraisal standards, such as USPAP guidelines. The reviewer analyzes the methodology and comparable sales that the original appraiser used, assessing the reasonableness of adjustments applied to comparable properties. For instance, if an adjustment was made for a larger comparable, the reviewer confirms the correct direction of that adjustment.

The desk review also involves assessing the overall quality and accuracy of the data in the appraisal report, identifying any material errors that could affect the original opinions and conclusions. The reviewer evaluates the property analysis, compiled property data, and value calculations presented in the report. This detailed examination ensures that the original appraiser adequately described how the value was determined and that the supporting evidence is sound. If the reviewer disagrees with the original opinion of value, they may be required to provide their own supported opinion.

Distinctions from Other Appraisals

A desk review appraisal differs significantly from a full, traditional appraisal, often called a “field” appraisal. The primary distinction is the physical inspection: a desk review does not involve an on-site visit. A full appraisal requires an appraiser to physically inspect both the interior and exterior of the property to observe its condition, features, and surroundings firsthand. This physical inspection allows for a more detailed assessment of the property’s unique characteristics and overall condition, which may not be fully evident from remote data.

Another type of appraisal service is a “field review,” which offers a more in-depth analysis than a desk review. While a desk review focuses on the technical aspects of the report from an office, a field review involves the review appraiser visiting the subject property, typically from the road, and sometimes the comparable properties. This allows the reviewer to verify the property’s physical attributes and the appropriateness of the comparable sales in person. Field reviews are more comprehensive and time-consuming than desk reviews, often taking several days to complete, whereas desk reviews can sometimes be finished within a single day.

The scope, time commitment, and cost also differentiate these appraisal types. Desk reviews are generally more cost-effective, with fees potentially ranging from $75 to $200, compared to traditional appraisals which might cost between $315 and $405. Field reviews typically fall between these two, estimated to cost around $300 to $400, reflecting the additional effort and resources required. The choice among these appraisal methods depends on the specific needs of the client, the complexity of the property, and the desired level of certainty and depth of analysis.