Cancel that Appraisal !
by Administrator on Aug 8, 2016
There are not many things that are more deflating than accepting an appraisal order made by a bank, individual or company and then having them turn around and cancel it. It's not so bad when it has only been a few hours, because by then I probably only have 50 to 100 files downloaded on the property plus the searching that I have completed in my work files, but when its been days I can have invested several hours and literally hundreds of files in my work file.
Going through it again today reminds me why I usually require a written appraisal agreement, but even if I had a contract this morning I would not have required pre-payment from a bank. Sometimes in the appraisal business it doesn't matter what you do to protect yourself there is always someone who is going to waste your time. When you are a small shop wasting time can finish you. You waste a few hours and its not that big a deal, you waste or lose a day and that can really make a difference, you lose a week and there goes your rent.
I prefer assignments where 50% of the fee is paid in advance and the balance upon delivery COD. If I spend my time working on an assignment before a payment arrives shame on me. If I make that decision I don't feel like I have been tricked into investing the time.
Having credit card processing is great, you don't have to wait for the mailed check which never arrives. A client is either paid and your working or they didn't and you are not wasting your time. I have been with at least 5 credit card processors in the past and everyone has had its own problems. Most want outrageous monthly fees for doing nothing but being available. I'm not paying $ 50 a month to a card processor who does nothing but then charges me a percentage when I finally do need them. If your business has multiple appraisers and you must be able to process credit cards it may be worth it, but for a single appraiser doing commercial reports its just not. Once a year I get an assignment where if I don't have processing I will lose it and I make a decision about signing up again based on those situations.
I have had cancellations after the report is complete, and after 50% of the fee was paid, but they are few. If someone has paid for the first half they usually are willing to pay the remainder. My guess is that 99% will pay the remainder. If a client wants out before I have completed the report I will sometimes give them a portion of the first 50% back, it just depends how far along I am. If I'm past 50% done then there will be no refund, but if I'm 25% of the way there I will give back a pro-rata share of the proceeds.
If a 1.0% client wants to see what I have done, if I'm saying I am 75% of the way toward completion, I will give them a screen shot of the work file that shows the icons of the individual files and let them see the files that I have accumulated. I'm not going to give someone a partially completed appraisal and then have them claim that I submitted a partially completed report to them, but I'm not going to hide the fact that I have done most of the work either.
I try to bid competitively but lately I have found that there are appraisers out there in my market who are bidding ridiculously low just to get as much of the work as they can. I have seen some of the work and at times I am amazed that there have not been complaints made agains them. I try to maintain some quality in my reports, but I can't make that claim for everyone.
One of the reasons that there are more and more requirements made in USPAP every couple of years is that I believe that before long there will be a standardization in report formats. It will take a number of years to iron those requirements out but appraisers in the future may be stuck with doing in the USPAP way or the highway. It's not something that I am looking forward to but clearly we are not doing it all the same way.
For more appraisal information contact Glenn J. Rigdon MA, MRICS, ASA is a Las Vegas / Henderson Nevada based appraiser who can be contacted via email or via his business website known as Appraiser Las Vegas (http://www.appraiserlasvegas.com), or you can also click on “Contact Us” on the home page of this website or visit my public profile at LinkedIn at http://www.linkedin.com/pub/glenn-rigdon-ma-mrics-asa/1a/30b/879/
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