In response to the growing and critically important role that appraisal review plays in risk management and mitigation for many clients/users of appraisal services, the Appraisal Institute established in 2014, two professional appraisal review designations; the AI-GRS (General Review Specialist) and the AI-RRS (Residential Review Specialist).

These designations are intended to provide professional reviewers with the knowledge and skills needed to satisfy issues related to due diligence and risk management often requested by their employers and clients. In order to obtain these designations, an appraiser is put through a stringent education process and rigorous regulation. 

Our company provides appraisal review services that are independent, qualified, professional and in compliance with the Federal Reserve’s guidelines. John M. Karnes, who also holds the Appraisal Institute’s MAI and SRA designations, holds the AI-GRS designation and is presently a Candidate for the AI-RRS designation.

Appraisal reviews are intended to determine whether the appraisal or evaluation is appropriate for the transaction, the risk of the transaction, and whether the process by which the collateral valuation is obtained ensures independence and quality. They should also indicate whether the appraisal or evaluation report is consistent with the client’s Engagement Letter, which should set forth the scope of the assignment. Some lenders also supplement routine reviews with post-funding evaluations of appraisal quality for some of their higher-risk or greater-value transactions as a control aid to assist in detecting valuation problems.

There are two types of reviews—a desk review and a field review.

Desk Review
The desk review is performed in the office and does not require a trip to the property. The focus of a desk review is with the technical aspects of the report—how the appraisal is put together and if it meets guidelines of the Uniform Standards of Professional Appraisal Practice (USPAP). In addition, it examines the logic and reasoning within the report that the appraiser used to arrive at a final opinion of value.

One example of what an appraiser performing a desk review might look at is how an adjustment was applied. We are all human and sometimes appraisers make mistakes by adding when they should have subtracted; this can have a material effect on the final opinion of value. 
An appraiser’s job is to describe or tell a story of value in such a way that the reader will understand the reasoning used. A review will determine whether they described in sufficient detail how the value was arrived at and if the evidence (comparables) supports it. 

Field Review

A field review is a more in-depth analysis of an appraisal compared to the desk review. This service requires the reviewer to visit the subject and comparable properties and inspect them from the street. 
The reviewer will research the comparables used in the report to determine whether they were the best available or if there are better ones that should have been included. If reviewers do not agree with the appraised value, they are required to offer their own opinion with support for it. 
You can rely on us for independent judgement and objective, ethical appraisal review services.