As a certified appraiser, a valuation specialist, through Appraisers International Society (AiS), I’d like to share my expertise and advice for hiring the services of a personal property appraiser.
“Cavaveat emptor” and “cognoscere nisi habeat fiduciam”
In case you are not Latin proficient: “Buyer Beware” and “Trust but Verify.” Very good advice when you need or want to engage the services of an appraiser. This can hold true for both Real Estate and Personal Property Valuation Services.
A real estate appraiser appraises property that is attached. That means land or structures attached to the land. A personal property appraiser is an appraiser of tangible (movable) property such as antiques, collectibles, guns, machinery, equipment, vehicles, historic documents, etc. With either professional, you depend on the appraiser to have both the education and experience to give you valuable information upon which you can base personal decisions.
Just FYI, an “estate” is a term used for both living and deceased. It is what you as an individual, a company, or a partnership own or have an interest in. You may need an appraisal for your insurance purposes to properly cover your valuable furnishings, art, collections, classic car, coins, stamps, silver, and so on. When a person in the family passes, there may be a need for an IRS or probate fair market value report. Both in business and family situations, the equitable division of personal property is needed. This could be a partnership being added to or divided, a divorce, or estate heir distributions. Information about an item before selling or purchasing, liquidating an estate or a business, insurance coverage, or insurance loss can all be reasons for seeking an expert valuer’s opinion.
How do you find an appraiser who is qualified to provide you with the information you need?
How can you distinguish between the qualified professional and a mediocre or worse, unethical “appraiser”?
Why is it important?
The appraiser may be a specialist or a generalist appraiser. Both are valuable and both have specific skills they can offer. How can the prospective appraiser’s skills best work for your needs? A “qualified” professional valuer has both a depth of education in the valuation sciences plus experience working in the field. One without the other is dangerous to the welfare of your interests. It is up to you to investigate the appraiser’s qualifications. It is also up to you to trust your “gut” instincts while interviewing the appraiser on the phone or in person. Ask lots of questions, get them talking with you so you can gauge how well you will work with the appraiser as a person.
A qualified appraiser has an ongoing membership and continuing education in a major quality appraisal association. You can check on that membership and what standing that appraisal society has easily online. There are a number of appraisal organizations out there. You have to ask specifically how much education, how many actual hours of study the appraiser has received for his/her certification.
If an appraiser tells you they are USPAP “certified” or “approved” they are unethically stating their qualifications. I am including this excerpt from the USPAP Foundation as it is so misused by some personal property appraisers: “The Uniform Standards of Professional Appraisal Practice (USPAP) is the generally recognized ethical and performance standards for the appraisal profession in the United States. USPAP was adopted by Congress in 1989 and contains standards for all types of appraisal services including real estate, personal property, business and mass appraisal. Compliance is required for state-licensed and state-certified appraisers involved in federally-related real estate transactions. USPAP is updated every two years so appraisers have the information they need to deliver unbiased and thoughtful opinions of value.”
If you read carefully, USPAP is a requirement for ethical behavior and standards (of report writing) for Real Estate appraisers. USPAP has a 15 hour course required every 2 years for proper report writing for real estate appraisers. If a personal property appraiser takes this 15 hour course and calls themselves “certified” they are misleading you and acting unethically. USPAP standards prohibit people who take the program from calling it a “certification.” However, there are a number of other 7-15 hour courses people take and those organizations DO call their members who take the short course “certified.”
Could you imagine a doctor or any professional being qualified with only 15 hours of education? You can see the worth of those “certifications” as soon as you find out how many hours of actual classroom education they have. I call them “weekend warriors.” For example, the AiSociety AiCore (AiS) Basic Program is approximately 180-200 classroom hours, plus additional required work outside the classroom. An additional 50-80 hours are required for a specialty certification course. Appraisers Association of America (AAA), International Society of Appraisers and American Society of Appraisers (ASA) have been around a long time and require approximately 60-100 hours for their certification. All four require additional ongoing education for re-certification. Each has differing re-certification requirements.
These are a few of the well respected appraisal societies that require real education to have a title. An interesting history note is the main educational founder of ISA is the same man who founded and created AiSociety (AiS), which focuses on raising the standards and quality of education on a national and global basis.
Experience in the subject to be appraised is also a critical consideration. Most well respected societies require a minimum of 3 years or more of actual experience to be certified, even if the student completes all the education. There is a great need for more appraisal companies bringing in young and new appraisers to gain the experience they need. Experience in a trade that parallels the appraiser’s field of expertise is valuable experience. Trade experience gives them the background of valuable identification skills needed to be an appraiser. Trade experience alone does NOT qualify a person as an appraiser.
The person in a trade knows his/her own trade experience. They do not have the valuation knowledge necessary, other than their limited personal experience, to identify the right markets to research for comparables. They do not know the national, regional, local, even global laws that apply to proper evaluation and valuation of personal property. They may provide an incorrect, even harmful product for the client’s use. They are not trained in the ethics or 3rd party requirements of a proper valuation product.
Ask for a personal CV (a professional profile). Ask for recommendations and follow up on them. Check the BBB (Better Business Bureau) and online for complaints. Ask if they have a website and review it, if so. Ask how long they have been in business. Never ask an appraiser to both appraise and then purchase an item or items. If they have an interest, that appraiser must tell you upfront before they do any work, as they are held to an extremely high standard of confidentiality and client-appraiser ethical behavior.
Lastly, expect to pay a fair price for a qualified appraiser. If they work too cheaply, that may be a red flag.
For those interested in my personal qualifications (professional profile, also called a CV) please feel free to refer to my website. A link is in my bio below.