Why Only Approved Appraisers?
Private lenders and MIC’s are particular about the appraisers they use. And they will generally only use their own approved appraisers.
And there is good reason for this. Private lenders rely primarily on the value of the property in making loan decisions. So, it only makes good sense that they’ll be more choosey about their approved appraisers.
When working with MIC’s or private lenders, it is always a good idea to ask for their approved appraisers for a given location. And remember to do so before ordering the appraisal. While it’s possible for the lender to make an exception and use an appraiser that isn’t on their list, it’s not common. Generally, if an exception is going to be made, it’s when certain circumstances are met. For example: if the LTV is quite low, an exception is possible. However, even then, an exception is not guaranteed.
What is most likely, is that if the borrower uses and pays for an appraiser who isn’t approved, the cost of the appraisal is wasted. To add insult to injury, the borrower will likely have to pay for a second appraisal from the approved list.
The good news about approved appraisers is that most private lenders and MIC’s use similar ones and keep a similar roster.
So, even if the 1st lender doesn’t like the appraisal, it may still have value to other lenders. Especially with lenders who are already interested in the deal.
So, the bottom line is that a little preplanning at the start can save your borrowers both time and money. By simply asking for the list of approved appraisers for that location from the start, you will keep your borrower from unnecessary and unexpected expense. This will also help to ensure no time is wasted on an appraisal they can’t use. When timelines and budgets are tight, being prepared from the beginning is always the best for you and the borrower.
