Shouldn't the appraiser give an unbiased appraisal of a property and not know the contract price on the house before hand?

Thanks

Wimbley
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As a rational person, you would think that would be the case; but since the time of the S&L Banking Crisis, and the creation of the Resolution Trust Corporation (RTC) the FDIC has required that the Appraiser have the complete P&S Contract in his/her possession when performing the "Arms Length Appraisal".

So for 20 years, the Appraisers have always known what the "Magic Number" is that they are shooting for. So, in my opinion, the seeds were sown for the even bigger crisis we find ourselves in now. The S&L Cure may prove to have been far worse than the disease.

If it took 20 years to break the system this badly . . . . maybe it'll take another 20 years to implement a fix . . . . cuz it's really broken now. I still contend that to fix something, you must first understand what is wrong with it. I don't think that is fully understood in Washington. I'd like a show of hands from those decision makers who can claim that they really have gotten their heads around the problem.

JMHO.

Well said above, Dale. It always cracks me up when I or a friend of mine are clearly buying a property well below market value (let's say our contract price is 120k when all comps point to 180k). Every single time, the appraiser will come back at 125-135k.

The only time when the appraiser doesn't get an "anchor number" to shoot for is when we do cash-out refis (or any kind of refi for that matter). Then they have to think for themselves and come up with a fair valuation because there is no purchase price.

I mainly list REO's and often get calls from appraisers who need access to perform an appraisal for the seller (bank). Of course they don't have a contract with a magic number.

It's really hit or miss. Sometimes they are pretty close to the two BPO's and sometimes way off.

I sure wish there were statistics available to quantify whether the BPOs or the appraised value are closer to the eventual sales price! Of course, the REO sellers have access to that info on a case by case basis, but I would like to know the aggregate numbers!!! What if, just what IF, it turned out that BPO agents are actually better at predicting eventual sales price when there is no contract to provide a target price?