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Appraised before, will you give a discount?

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Tim Hicks (Texas)

Thread Starter
Elite Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Texas
I have been getting this question a lot lately. I appraise a house that sold 6 months to three years ago and now they want me to do a new appraisal for refinance. Well, you already have all the information, can we get a discount on the appraisal fee? I kindly explain that I stiil have to do a new report, but the only real time I will save is the actual measuring of the property and that is if they have made no changes. If it is a good client, I will give them $50 discount if they ask. I never volunteer a discount, but I wonder when they are going to start asking why I didn't offer when they don't ask. I did ask the loan officer one time how many points they were knocking off since they did the loan before, but that didn't go over too well. How about you guys and girls?
 

Mountain Man

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Georgia
Ohhhh, your last comment must have been scathing! :lol:
I just say nope. It is still a completely new process. I explain that I get paid because it is a job that takes a lot of research time, even after only six months. The time it takes me to meauser the house is less than 25% of the time it takes to complete the whole process.
This is the same answer I give when they want a URAR after having had a 2055 three months prior.
Mell.
 

Dave Doering

Sophomore Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Missouri
Given the high refinance activity, we are periodically asked to give discounts for "redos" or "updates" of appraisals done within the prior 6 months to 3 years. For regular, good paying clients we do give a discount for properties done within a reasonable timeframe (6 months to 1 year) that is reflective of any time saving from having an established record of the property. Like you, we tend to limit this to our estimate of the time saved in measuring the dwelling. We do, however check the measurements and inspect the property with the same level of care.

The difficult part from a business perspective of giving "discounts" for the "easy" appraisals is that we are seldom able to charge a premium for what turns out to be a more difficult and time consuming appraisal. Fees in our market are pretty well set by the report format. While we do charge more for extraordinary properties such as properties with acreage or atypical properties far above the typical market range, our clients do not appear to be willing to pay a premium for those properties where sales are hard to find and pages of explanation are required.

By charging a consistent fee for both the easy and the difficult compensation tends to balance out. For that reason, we never offer a discount and only give one when it is consistent with maintaining a business relationship with a preferred client.
 

Neil (Texas)

Sophomore Member
Joined
Jan 16, 2002
Professional Status
Certified General Appraiser
State
Texas
Interesting you ask that question this morning. Received this AM a request to appraise a property which I had appraised less than a year ago. Had two last week, under similar circumstances...

No, I don't offer discounts. I just considered it a windfall to make up for some of the real @*#! assignments from the same client. With a smile and a twinkle, I tell them "maybe I can make a profit on this one".

Hang tough.

Neil (Texas)
 

Dee Dee

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
I give a $50 discount, but only if there have been no major structural changes made to the home. A walk-through will confirm any updating or depreciation changes, then I clone the previous report (flood maps, legal description and some other miscellaneous minor information will not change) and add more current comps.
Some of the more seasoned appraisers in my area have it made...more than 50% of their work is repeat appraisals on homes that they've done in the past, often with different lenders. I look at the discounted fee as a subtle kind of marketing for future work using the homeowner, and it has definately gotten my foot in the door for working with new lenders who otherwise might never have know that I specialize in the unusual area that I cover. A $50 discount on one appraisal can lead to many new full price appraisals...at least that's been my experience.
 

rtubbs

Junior Member
Joined
Jan 15, 2002
I, generally, will deduct $50 from my normal fee for a repeat appraisal; however, that depends on the difficulty of the property, its location, etc.
 

Kevin Darland

Freshman Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Kentucky
I take it case by case, however, as someone said earlier, if it is for a new client, then I most definately give them a discount, and then try and work them for more future assignments :) .
 

Ron in AR

Sophomore Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arkansas
I generally try to give a small break if I can but I've found that the cases I discount are the ones that end up taking longer than most and have more problems than the full fee deals.

Ron in AR
 

Richard Carlsen

Elite Member
Joined
Jan 15, 2002
Professional Status
Licensed Appraiser
State
Michigan
Question: Does your liability go down with the new appraisal? I think not. Therefore why discount?

But it is your business and your decision.

The only reason that I could see for a discount is if the LO guaranteed you x-number of appraisal per year at y-dollars. You might discount a little for the assurance of business.

Richard Carlsen
 

Theresa in Oregon

Sophomore Member
Joined
Jan 18, 2002
I agree with Richard. The risk is the same. What I tell my clients is, "I can't discount the fee but, because the report-writing process will be somewhat shortened due to the basic property information I have already contained in my files, I can discount the turnaround time by 50%". This always makes 'em happy.
 
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