Commercial appraisers lament about doing bank work. I’m not sure why. Often it represents 60% of the total sales volume of a typical firm. Yes, they have reviews. Yes, the fees are competitive. A more productive mindset would be to serve them better.
It may come to a surprise for some appraisers that your bank clients are grading you. For many banks, it’s simply policy, part of vendor management.
As a fee appraiser, take the opportunity to up your game through grading. Even if you’re nearing the end of your career, it’s still a great opportunity to take a fresh new look at your report quality and how you deliver your product.
As a fee appraiser, what exactly does the appraisal department expect of you? For many of our YouConnect clients, they rate you on a scale from A-F. The criteria includes quality, timing, corrections, professionalism and communication.
- Quality (50%) – if you’re a “good” reviewer, you know when report quality is high. You can tell the difference between stale comp data, cursory highest and best use with no meat and little effort to tie the subject property to the local market.
- Timing (25%) – obviously the report needs to be turned in on the due date. Appraisal managers dislike appraisers that chronically bid two weeks but take three weeks to deliver. Up your game and deliver it early.
- Corrections (15%) – contrary to some fee appraiser’s belief, reviewers don’t like requiring edits. Reviewers have deadlines just like fee appraisers. After you make the corrections, go back to your report template such as DataComp Suite, and incorporate the reviewer’s feedback. The goal, a “review proof” report format.
- Professionalism (5%) – take a look at your report format (and your website) and see if it requires updating. Make sure it communicates the branding you want to put out to the universe. Dress up nice for your inspections since you’re effectively a representative of the bank.
- Communication (5%) – this criteria is often overlooked and can alleviate a lot of problems up front. If the borrower is not providing necessary documentation, communicate with your bank client quickly.
Reviewers in the YouConnect system can grade their appraisers, but also there’s the flexibility to provide an overall grade beyond the mathematical weighted average of the criteria. In the end, both the appraisal manager and fee appraiser want to have a productive relationship.
(Re)meet your appraiser panel
Given the decline of appraisers, if some of your vendors have relatively low scores, have a conversation with them. Pick up the phone and talk. Oftentimes it could be veteran appraisers struggling to train younger appraisers who sometimes make mistakes and it shows up in the grading system.
Close the feedback loop
Immordino-Yang writes in Emotions, Learning, and the Brain, “When kids care mainly about grades, they’re devoting more mental resources to the assessment than to the actual subject matter.”
If grading is done properly, it can raise the game of your fee panel. Punitive grading (over-zealous reviews) without a conversation with your fee panel can result in sanitized appraisals. The report looks pretty but is lacking the local deep dive of market knowledge, or the subject is always in “average” condition with no deferred maintenance…you get the idea.
For many appraisers, the review function can seem sometimes disassociated with learning. No appraiser likes to make a mistake, but appraisers are human and often don’t see reviews as an opportunity to improve their report format.
If we all get on the same page, report quality can improve, report deadlines met and facilitate our value as valuation professionals, providing sound collateral risk analysis.
The goal for both appraiser manager and fee appraiser is excellence.
Up your appraiser game with grading.
What’s your grade?