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Understanding and Interpreting Real Estate Appraisals

Course Overview

The Understanding and Interpreting Real Estate Appraisals course is designed to introduce management, bankers, loan administrators, loan reviewers, and administrators of bank appraisal programs to the issues involved in ordering and reviewing real estate appraisals. This course is designed to give participants a foundation in the terminology, methods, regulations, and review of appraisal for lending purposes. The course offers hands-on interactive learning focusing on:

  1. An overview of appraisal methods and techniques, including the three approaches to value: cost, sales comparison, and income.
  2. An introduction to the appraisal review process based on appraisal requirements and best practices.

     

Duration

7.5 hours

 

Prerequisites

None.

 

Delivery

Instructor-Led Online

 

Who Will Benefit?

Bank staff who order and review appraisals, underwriters, lenders, and credit administration professionals who need to understand appraisals and make sound decisions based on the value of the collateral taken in conjunction with real estate lending.

Program Level

Foundational

 

Pricing

Member: $449
Nonmember: $829

   

Learning Objectives

Upon completion of this course, participants will be able to:

  • Identify the requirements for appraisals—bank appraisal regulations and guidelines; independence issues; introduction to Uniform Standards of Professional Appraisal Practice (USPAP).
  • Identify the steps needed to order an appraisal, considerations in selecting and engaging an appraiser.
  • Recognize the basic components of appraisal compliance—minimum appraisal standards; reporting requirements; and compliance checklist.
  • Recognize the analytical steps in the valuation process used in appraisals— market and property analysis; highest and best use; valuation approaches, methods, and techniques.
  • Determine the rationale for and identify the process used in the Cost, the Sales Comparison, and the Income Approaches to value. 
  • Identify appraisal review issues in the application of the Sales Comparison approach.
  • Identify review issues in the analysis of income and expense and the selection of the capitalization rate in the Income Approach to value.
  • Identify common errors in appraisals (residential and commercial) and how to communicate with the appraiser during the review process.

Methodology:

Understanding and Interpreting Real Estate Appraisals includes a residential and a commercial case study:

  • The residential case study examines a residential single-family form appraisal report and addresses review issues and common deficiencies in residential appraisals.
  • The commercial case study examines a typical commercial appraisal report and addresses review issues and common deficiencies in the Sales Comparison Approach as well as the income and expense and capitalization rate analyses in the Income Approach.

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