Home » Home Appraisal for Divorce Purposes: Why Using a Professional Appraiser Makes Sense

Feb 23, 2015

Home Appraisal for Divorce Purposes: Why Using a Professional Appraiser Makes Sense


by Richard M. Lam, Richard M. Lam & Associates

One of the largest assets to consider in a divorce is the house, typically owned jointly by the couple. An appraisal can help to determine the Fair Market Value (FMV) of the home for equitable distribution purposes, especially if one person wants to keep the home. An appraisal offers a guide to what sales price the home is most likely to draw on the open market. This is crucial if one party to the divorce is pursuing a buy-out of the spouse’s interest.

An appraisal is an estimate of value only. It is typically determined using similar comparable properties which have recently closed while consideration is paid to active listings and pending sales.

What do appraisers look at? They look at the property through the eyes of a typical prospective buyer. What determines the comparable properties? This is where the competency of the appraiser can become clearly evident. Based on the appraiser’s knowledge of the community and experience, the appraiser carefully and comprehensively searches databases for recently settled, similar properties, within close proximity. Typical parameters for the search include limited distance away, limited historical time span, number of bedrooms, number of bathrooms, size of lot, size of home, and style of home. Adjustments for differences should be supported and are typically and customarily used to compensate for shortcomings or superior attributes. Adjustments are typically made for a deck, patio, porch, garage, central A/C, garage, pool, etc.

Everyone’s home has some unique element so, the more info provided to the appraiser the better. An appraiser with depth and breadth of experience will typically take into account the unique characteristics required to produce a fair and balanced value. It is always a good idea to offer the appraiser your knowledge of sales that the appraiser may not know about. Typically, appraisers use the Multiple Listing Service (MLS) to locate comparable properties. A homeowner may know of a local sale that was not handled via MLS, such as a private sale. The appraiser can verify the transaction through public records and determine if it is a comparable sale.

What should you look for in an appraiser? At a minimum, all appraisers must follow a code of ethics called the Uniform Standards of Professional Appraisal Practice (USPAP). These are federal guidelines that are enforced by the states. This helps to ensure that an unbiased report is performed using a standard method. Real estate agents and brokers are not required to follow these standards which help to explain why their opinion of value of a property can differ greatly from the appraiser’s. Due to the standardization of the USPAP guidelines, appraisers’ values tend to be more reliable and realistic. In Pennsylvania, there are two licensed classes of appraisers – “General” & “Residential”. General appraisers are licensed to appraise all real estate, have completed more education, have more experience, and have satisfactorily passed a comprehensive real estate appraisal exam. As the name implies, “Residential” appraisers are limited to only appraise residential properties – up to a 4 unit qudraplex.

In a divorce situation, it’s important to look for a knowledgeable and experienced appraiser. If the couple is able to agree on a single appraiser rather than one for each party to the divorce, it will save both money and time.

Mr. Lam has appraised over 12,000 properties since 1989. He has extensive experience with all types of residential, commercial, and industrial properties. He has been a Pennsylvania Certified General Appraiser since 1992 – when the licensure law was first enacted, obtained his real estate broker’s license in 1986, and been FHA/HUD Qualified and Approved since 1993. His firm has been the premier choice for appraisals in southeastern Pennsylvania with a well-earned and respected reputation for personalized, friendly and professional service.
Click here for more information on Richard M. Lam and Associates.

Image courtesy of renjith krishnan at FreeDigitalPhotos.net