Every appraisal order begins with a customer consultation. This is an in-depth discussion of the home, and the purpose of the appraisal. Any method of communication can be used for this step of the process. The purpose of the consultation is to find out how the appraisal can help you. The consultation will aid in the understanding of the intended use of the appraisal. Different uses have different reporting requirements.

An appraisal used to settle an estate often needs a value estimate as of the date of death, rather than the current date. Even if this period is short, the valuation date needs to be exact. The right date of value will ensure proper settlement. When the appraisal is being used for estate tax calculations, use of the Internal Revenue Service’s definition of value is needed. This definition requires specific statements and certifications. A shift from these requirements will cost added time and money down the road.

Divorce appraisals have their own set of requirements. Like an estate appraisal, the date of value is crucial. In some situations, the date of separation is used. If one of the parties owned the house prior to the marriage, two dates of value may be needed. Both the value on the date of marriage and on the date of separation are used to show any equity gain during the marriage. It is always recommended that you consult an attorney to find out what your exact needs are.

Appraisals can be used to eliminate your lender’s requirement for Private Mortgage Insurance (PMI). It is suggested that the homeowner verify with the lender that an appraisal hired by them will be accepted. Some lenders will accept this type of appraisal. Other lenders want an appraisal that is ordered directly by them. Appraisal forms and format requirements vary between lenders. Appraisals made outside of the loan application process are completed on general-purpose appraisal forms. When the intended use is to drop PMI, some lenders want to use Fannie Mae Form 1004. This is a mortgage specific form. An appraisal using the wrong form will hurt your chances of ending PMI.

There are many situations that require a home appraisal. A few have been discussed in this blog post. It is important that the appraiser knows exactly what the appraisal is being used for. An in-depth consultation prior to beginning an appraisal assignment is essential. Without full knowledge of your goals and purposes, the appraisal report will not be useful for your needs.