Reconsideration of Value

What is an Appraisal?

An appraisal is an estimate of how much a property is worth, determined by a licensed real estate appraiser. Lenders require an appraisal to make sure that the property you are offering as collateral for your loan has sufficient value to support the requested loan amount.

What is a Reconsideration of Value (ROV)?

An ROV is a way to request an appraiser reassess their appraisal using additional information that may affect their value conclusion. Simply complete the ROV Request Form and include the information, data, comparable sales, or evidence of bias or discrimination that you believe will impact the value conclusion.

General guidance on errors or omissions

Appraisal reports have detailed descriptions, measurements and other data for the subject home and comparable properties that are used to determine the value of the property. It is important that these descriptions, measurements, and other data are accurate and complete. Here are some common examples of factual errors:

• Incorrect number of total rooms, bedrooms, bathrooms, or garage spaces
• Incorrect square footage of the entire site, gross living area, or specific rooms
• Incorrect age of home
• Incorrect quality of construction ratings
• Incorrect property condition ratings

Here are some common examples of omissions:

• Failing to include features such as a fireplace, swimming pool, patio, or deck
• Failing to describe any deferred maintenance, recent remodeling, or upgrades
• Failing to include the recent sales history and prior purchase price of the house

Please provide as much information as possible for the appraiser to consider. For factual errors in the appraisal, specify what is inaccurate. For omissions, specify the features or characteristics of the property that are missing.

General guidance on comparable property selections

Comparable sales are recent sales of similar properties that appraisers use to help determine the fair market value of a subject property. The appraiser is responsible for selecting the best and most appropriate comparable sales based on a variety of factors. Here are some general guidelines that appraisers follow that should guide you in this ROV process:

• Comparable sales should be recent sales that have closed no more than 12 months before the completion date of the appraisal report.
• Comparable sales should be near the subject property, and ideally located in the same neighborhood. If there are not enough recent comparable sales in the same neighborhood, the appraiser may select comparables from other nearby neighborhoods.
• Comparable sales should have similar physical characteristics to the subject property, such as the number of bedrooms and bathrooms, square footage, style, and condition. This does not mean the comparables must be identical to the subject property, but they should appeal to the same buyers.

Please provide specific addresses of comparable sales you think the appraiser should have selected (or not selected) and why. If you are working with a real estate agent, they may be able to help you find comparable sales in the area. You may use websites like Redfin^® and Zillow^® or public records to find recent sales activity – but keep in mind, you cannot use current listings.

General guidance on bias or discrimination

It is improper for an appraiser to reach a conclusion of property value based on characteristics such as race, color, religion, national origin, gender, marital status, familial status, age, receipt of public assistance income, or handicap. Appraisal discrimination can result in a home being undervalued or overvalued. Some examples of possible bias or discrimination are:

• Receiving an appraisal valuation that is lower than the contract purchase price
• Verbal discriminatory or biased comments by the appraiser
• References to race or ethnicity in the “Neighborhood Description” or anywhere else in the appraisal
• References to languages spoken in an area
• References to amenities geared toward a race, ethnic or religious group, such as the property is near a shopping center that has certain ethnic food and clothing stores
• Comments that house prices in the area are rising due to gentrification
• References to the diversity or lack of diversity in an area

Please explain the facts and circumstances that show the appraisal may have been impacted by bias or discrimination.

Appraiser independence requirements

Federal law prohibits anyone from influencing or trying to influence an appraiser’s value conclusion through coercion, collusion, compensation, or intimidation. To avoid any appearance of influence when submitting your ROV Request Form, please:

• Do not give your opinion as to the correct value or range of values you desire. However, you may list the contract purchase price or prior sale price of the property.
• Do not provide a prior appraisal report. However, you may include comparable sales from that report if they are no more than a year old.
• Be respectful in providing your narrative about your concerns with the appraisal.

Note: We may ask you to resubmit the ROV Request Form if these guidelines are not followed

Form Submission:

1. Complete the ROV Request Form on your own, or consult with your real estate agent for their input as to which comparables or other relevant information may be beneficial to include with your request. Even if your real estate agent or loan officer does not believe that submitting an ROV request will result in a change in the value conclusion, you are still entitled to do so.
2. You must complete and sign the ROV Request Form and return it to appraisaldesk@northpointe.com. The form must be returned for Northpointe Bank to take action.
3. The completed ROV Request Form will be reviewed to ensure it is completed correctly, provides sufficient information for the appraiser to consider, and does not contain prohibited information. If these requirements are met, Northpointe Bank will submit the ROV request to the appraiser.
4. The appraiser will consider the ROV request and may agree or disagree that an adjustment or correction to the report is appropriate. The appraiser is an independent valuation professional who will determine whether or not the appraisal report warrants a change and cannot be directed by you or Northpointe Bank to change the appraisal.
5. Your loan officer will communicate the outcome of the ROV request to you.

Email Completed Form

Northpointe Bank is an Equal Housing Lender committed to promoting the availability of credit without regard to race, color, national origin, sex, marital status, or age.

Have additional questions? Reach out to your loan officer or the Northpointe appraisal desk at appraisaldesk@northpointe.com