Engagement letter

[PushinValue]

Hello, probably a pretty basic question....


If a client engages an appraisal company/firm, does the engagement letter need to specify which appraiser is completing the assignment? If so, does the assigned appraiser need to sign the engagement letter? If so, how do you address an engagement letter if you are unsure which appraiser is going to complete the assignment?

Thanks

 

[BRCJR]

Hello, probably a pretty basic question....


If a client engages an appraisal company/firm, does the engagement letter need to specify which appraiser is completing the assignment? If so, does the assigned appraiser need to sign the engagement letter? If so, how do you address an engagement letter if you are unsure which appraiser is going to complete the assignment?

Thanks

If for a regulated lender the Appraiser is selected not the firm. There could be several Appraisers in the firm but the lender does not have all of them on their Approved List.

VI. Selection of Appraisers or Persons Who Perform Evaluations
An institution’s collateral valuation program should establish criteria to select, evaluate, and monitor the performance of appraisers and persons who perform evaluations. The criteria should ensure that:
•The person selected possesses the requisite education, expertise, and experience to competently complete the assignment.
•The work performed by appraisers and persons providing evaluation services is periodically reviewed by the institution.
•The person selected is capable of rendering an unbiased opinion.
•The person selected is independent and has no direct, indirect, or prospective interest, financial or otherwise, in the property or the transaction.
•The appraiser selected to perform an appraisal holds the appropriate state certification or license at the time of the assignment. Persons who perform evaluations should possess the appropriate appraisal or collateral valuation education, expertise, and experience relevant to the type of property being valued. Such persons may include appraisers, real estate lending professionals, agricultural extension agents, or foresters

 

[Elliott]

When someone calls and orders an appraisal, I memorialize the conversation about the appraisal assignment in an email. Client, addresses, dates, fee, purpose, function, etc., whatever is relevant in a few sentences....and where they can send the retainer. It avoids a lot of issues.

 

[PushinValue]

I should have specified. Private appraisal. IRS/date of death

 

[Tom4value]

Hello, probably a pretty basic question....


If a client engages an appraisal company/firm, does the engagement letter need to specify which appraiser is completing the assignment? If so, does the assigned appraiser need to sign the engagement letter? If so, how do you address an engagement letter if you are unsure which appraiser is going to complete the assignment?

Thanks

What is this, “need” and ”has to”? There are no rules for LOE as there is no requirement for one. USPAP just specifies that the appraiser “define the problem to be solved” and be sure of the scope of work. True, a LOE is very common and most professional appraisers and clients use them but they can range from a multi-page document to a well specified email.

That said, the general assumption is the items that you are asking about are client specific and not a rule. The only thing is if a client specifies an appraiser (or one the client doesn’t want) in the LOE, you are expected to honor it. Same thing with signing it. Only one of my clients expects me to sign it and send it back to them.

 

[Terrel L. Shields]

If a firm is taking the assignment, then the president or other officer should sign. Otherwise, the appraiser doing the report should sign.

 

[Long Walk]

What is this, “need” and ”has to”? There are no rules for LOE as there is no requirement for one. USPAP just specifies that the appraiser “define the problem to be solved” and be sure of the scope of work. True, a LOE is very common and most professional appraisers and clients use them but they can range from a multi-page document to a well specified email.

That said, the general assumption is the items that you are asking about are client specific and not a rule. The only thing is if a client specifies an appraiser (or one the client doesn’t want) in the LOE, you are expected to honor it. Same thing with signing it. Only one of my clients expects me to sign it and send it back to them.

A well-written engagement (whether an email or a signed letter) is the best tool I know of for getting appraisal elements agreed upon: intended use and user, EA/HC issues, subject property, etc. And for contractual terms (which USPAP does not deal with): fee, delivery date, assigned appraiser, report format (hard copy or electronic). So much of successful practice management is taking care of the defensive details.

 

[Tom4value]

A well-written engagement (whether an email or a signed letter) is the best tool I know of for getting appraisal elements agreed upon: intended use and user, EA/HC issues, subject property, etc. And for contractual terms (which USPAP does not deal with): fee, delivery date, assigned appraiser, report format (hard copy or electronic). So much of successful practice management is taking care of the defensive details.

Agree 100%. Please don't interpret my post as downplaying the importance of the LOE. Indeed, a well written LOE has gotten me out of a potential mess with a client many a time. My point was to relieve the OP of any fear of what is required.

 

[Long Walk]

Agree 100%. Please don't interpret my post as downplaying the importance of the LOE. Indeed, a well written LOE has gotten me out of a potential mess with a client many a time. My point was to relieve the OP of any fear of what is required.

I got your point and agreed. My post was only to amplify the importance of the LOE as it touched practice management....and appraiser sanity. LOL

 

[PushinValue]

What is this, “need” and ”has to”? There are no rules for LOE as there is no requirement for one. USPAP just specifies that the appraiser “define the problem to be solved” and be sure of the scope of work. True, a LOE is very common and most professional appraisers and clients use them but they can range from a multi-page document to a well specified email.

That said, the general assumption is the items that you are asking about are client specific and not a rule. The only thing is if a client specifies an appraiser (or one the client doesn’t want) in the LOE, you are expected to honor it. Same thing with signing it. Only one of my clients expects me to sign it and send it back to them.

Thank you for this