The profession

An appraiser is paid to be indifferent to what you want.

An appraiser is a licensed or certified professional who gives an independent opinion of market value. Everyone else in a sale gains from a particular number. The appraiser is kept out of that on purpose.

Below: the method, the license ladder and the independence rules.

A person measuring an empty interior room with a handheld tool, arm extended, lit by raking window light across bare walls and a wooden floor.

The method

Three approaches to value

Every appraisal uses one or more of three approaches. Residential work leans on the first.

Sales comparison

What did similar nearby property sell for, and what is this one worth after adjusting for the differences? The backbone of residential appraisal.

Cost

What would it cost to rebuild, minus depreciation, plus the land? Most useful for new construction and unusual property with few comparable sales.

III

Income

What income does the property produce, and what would an investor pay for it? The main approach for commercial and rental work.

Then the appraiser reconciles, explaining which approach and which comparable sales carried the most weight, and why. That step is judgment, and it stays with the appraiser.

Credentials

The license ladder

Appraisers are licensed by the state, and the titles are not interchangeable. Each rung means more education, more supervised experience and a wider scope of work.

Trainee Appraiser

Works under a certified supervisor. A trainee can inspect and assist, but the supervisor signs and is responsible for the report.

Licensed Residential

Independent work on non complex one to four unit homes, within value limits set by the state and the loan program.

Certified Residential

One to four unit homes without those value limits, including complex assignments.

Certified General

All property types, including commercial, industrial and large income producing property. The widest scope on the ladder.

Separately, an appraiser can be on the FHA roster, which lets them appraise for FHA insured loans. That is an approval, not a rung.

Independence

Why you cannot call them about the number

Appraiser independence rules keep the lender, the loan officer, the agent and the borrower from influencing a valuation. That is why the order usually goes through an appraisal management company instead of coming straight from the person writing the loan.

It can feel obstructive when you are the one waiting. The rules exist because appraisals that bend toward the number a deal needs are how lending goes wrong at scale.

Facts are welcome and go through whoever ordered the report: a closed sale the appraiser missed, a permit, a wrong room count. Pressure is not.

Appraisers also work under USPAP, the Uniform Standards of Professional Appraisal Practice. It sets the ethics and competency rules behind the license.

Certified appraisers

When you need one yourself

If you are a homeowner who needs an appraisal, or you simply want to see how the work is done up close, you can work with a certified appraiser through Pocket Appraisal, a national residential appraisal service.

Whoever you work with, you can confirm their credential yourself on the national registry. Our guide to looking up an appraiser's license shows how.

Questions

Common questions

What is the difference between licensed and certified?

Scope. A Licensed Residential Appraiser works on non complex one to four unit property within value limits. A Certified Residential Appraiser works on one to four unit property without those limits, including complex assignments. Certified General covers all property types, including commercial. Each step needs more education and more supervised experience.

What does FHA approved mean?

The appraiser is on the FHA roster and can perform appraisals for FHA insured loans. It sits alongside the state credential and does not replace it. If your loan is FHA, check for it, because not every appraiser is on the roster.

Does the appraiser work for the lender?

The lender engages them, usually through an appraisal management company, and the lender is the intended user of the report. They do not work toward the lender's preferred number. Independence rules and professional standards separate who pays for the report from what it concludes.

Is USPAP a law?

It is the professional standard for appraisal practice in the United States, covering ethics, competency and how reports are developed and communicated. States adopt and enforce it through licensing, so for a licensed appraiser it is binding.

Question about the profession?

Ask about credentials, scope or how the independence rules work.