Appraisals For Probate

[Travis McGee]

Are there certain appraisers hired by the courts to value property that's in Probate? I'm trying to figure out how the value for probate could be inflated over the value supported by comps, legally. Maybe the appraisers who do it for the courts have different rules? There has to be SOME reason a property I'm appraising for a client-buyer can't comp out at more than two thirds the value that was set on the property in Probate.

Since the appraiser in the Tax Assessor's office has used that same inflated value on which to base his assessed value, the discrepancy between that appraiser's figures and my figures is so huge (almost $200,000) my credibility is at risk..........I suspect folks are inclined to believe the Tax Assessor's Office before they believe an independent appraiser.

The numbers are the numbers. But I'm fairly new at this and think there might be more to this situation than I can see. What am I missing?

Thanks,
Barbara

 

[Bill Rose]

Very good questions. I would like to know as well why appraising for a probate would be any different than a standard appraisal, except for some reporting differences.

 

[Michigander]

Are there certain appraisers hired by the courts to value property that's in Probate?

Typically the appraiser (at least in my area) is hired either by the attorney handling the estate or the personal rep.

I'm trying to figure out how the value for probate could be inflated over the value supported by comps, legally.

Shouldn't be inflated; they are looking for fair market value as of the date of death, so unlsess the value has decreased, it should be in line with what you have now.

Maybe the appraisers who do it for the courts have different rules? There has to be SOME reason a property I'm appraising for a client-buyer can't comp out at more than two thirds the value that was set on the property in Probate.

No different rules, except that again, it is usually a retrospective value to the date of death. Are you possibly doing something wrong yourself?

Since the appraiser in the Tax Assessor's office has used that same inflated value on which to base his assessed value, the discrepancy between that appraiser's figures and my figures is so huge (almost $200,000) my credibility is at risk..........I suspect folks are inclined to believe the Tax Assessor's Office before they believe an independent appraiser.

The tax assessor does not rely on an appraisal for the estate. Tax assessors have their own methods of valuation. If the tax assessor and the appraiser for the estate are similar, is there any possibility at all that you are incorrect? Just think about it. Just because somebody is higher (or lower) than your opinion, does that mean that they are necessarily wrong?

The numbers are the numbers. But I'm fairly new at this and think there might be more to this situation than I can see. What am I missing?



Best, Rachel

 

[Walter Kirk]

Barbara,
Are you sure that the probate court used an appraisal at all? In my experience many lawyers use the tax assessment as their value unless it doesn't meet their needs. It is quite possible that the tax assessment is wrong, many are based on mass appraisal systems or AVM type processes and not on a real appraisal. If you are sure that you are right stick by your guns. You may also suggest that the owner file a tax assessmrnt appeal, and earn another fee.

 

[Larry Lyke]

Barbara –

There’s no magic involved.

Ask whoever or however the property value was determined.

It may not have been an appraisal at all, as you understand it.

And, there’s no reason to believe anyone would believe the assessor over an independent fee appraiser: The assessor’s job is to generate their portion of the necessary revenue to fund operation of the county, and they use the mass appraisal technique.

L- MN

 

[Restrain]

I have seen executors use the tax value. I just did a bankruptcy where the court administrator wanted to use the tax value and I was hired to do an appraisal. Court administrator backed down when my report was presented.

Roger

 

[Travis McGee]

The ironic part of this whole story is that the tax value was $162,000 the day before probate and $568,000 the day after. There are no comps to support that, even if I spread my search criteria out as much as five miles and back as far as 3 years. Cost Approach doesn't get me even close either.

But you've answered my question ...........is there a different way of appraising for a property that's being valued for probate........and I much appreciate that.

Now it's my job to figure out how I'm going to proceed in red-neck country where I probably just got myself labeled "poison" because I questioned the appraiser in the tax assessor's office.

Thanks again,
Barbara :idea:

 

[Walter Kirk]

Was a deed filed on the date of probate? Was the tax assessment based on that deed? perhaps the heir(s) want a high tax basis to reduce the income tax on a future gain. It would be interesting to find out what happened in this case.

 

[Travis McGee]

Let's just say the heirs DID want a higher value placed on the home so, when it sells, they will be liable for less tax. Does the Owner/heir really have a say about value?

And yes, the probate date was the new tax assessment date, but that's logical, because ownership changed from the Trust to the heirs.

It's doubtful there's a way to find out what really happened unless probate proceedings are a matter of public record. I'll look into that.

cheers,
Barb

 

[xm39hnu]

Barbara said...

Let's just say the heirs DID want a higher value placed on the home so, when it sells, they will be liable for less tax. Does the Owner/heir really have a say about value?

Might be tax evasion or tax fraud, if that valuation was willfully falsified for the purpose of avoiding taxes. Document everything in your workfile, and don't take any shortcuts. Be careful not to assign mendacity to simple ignorance, though.