By Mabél Guzmán

Today’s market and lending industry requires not only unequivocal local knowledge, but also the know-how to navigate myriad regulatory guidelines. For instance, when the Home Valuation Code of Conduct (HVCC) was initiated regarding appraisals, we saw a negative impact on homes that went under contract. This was because, first and foremost, many thought they could not talk to the appraiser, could not give the appraiser comparables and could not challenge the appraisal. It did not matter if the home was selling for $150,000 or for $1.5 million, the challenges were steep and misinformation made it difficult to close what agents thought was a done deal.

Let’s look at these misunderstandings:
You can’t talk to appraisers. The fact is, you can. You also can determine if they are familiar with the area and/or have done appraisals in the neighborhood, and share information about the area to back-up home value.
You can’t give appraisers comparables. The reality is, you can. Now that you have established rapport, you can support your statements and provide information to help appraisers understand the neighborhood.
You can’t challenge appraisals. Yes, you can! Rather, your clients can, and should if they feel the price that was offered and accepted is justified.

Additionally, the appraisal does not end with the appraiser. Once the 30-plus-page report leaves the appraiser’s hands, it is scrutinized by folks who also have a vested interest: private mortgage insurance companies (PMI), underwriters and appraisal management services. There may be a desktop review, as well. I call all these factors that impact the sale the “Internal Adjustment Bureau.” Prepare your clients up front. If working with sellers, explain and ask if they will be flexible to ask for even less if the appraisal comes back for less than negotiated. Have a sit-down with buyers and ask if they are willing to come up with a larger down payment or pay for a new appraisal. In the end, you will lead the deal instead of react to it.

Mabél Guzmán, ABR, AHWD, is the 2010-11 President of the Chicago Association of Realtors AND A BROKER ASSOCIATE WITH @PROPERTIES. she is respected for her professionalism, tell-it-like-it-is honesty and ability to build relationships. A veteran Realtor, Guzmán is recognized for her efforts to advance the professionalism of the real estate industry, including by serving the Illinois Association of Realtors and the National Association of Realtors, on their Boards of Directors and as a member of various committees. She is Also an advocate of fair tax policies, and has worked with the City of Chicago to ensure that more than 30,000 city homeowners had the opportunity to file tax appeals. She also participated in Illinois Association of REALTORS discussions at the national level about loan limits and housing policy.