Adlaw Appraisals – Who is authorized to receive a copy of the appraisal?

Releasing Appraisal Reports

Adlaw Appraisals Ltd. office policy on releasing appraisal reports: Consistent with our professional organization (AIC) and other firms in the industry, we do not authorize release of the report to anyone but the intended user (client)

Background:

Yes, you the paid for the appraisal report, but this does not mean they are entitled to receive a copy. Canadian appraisers follow the Canadian Uniform Standards of Professional Appraisal Practice (CUSPAP), which states that only the appraiser’s client or intended user is entitled to a copy of the appraisal report. CUSPAP define’ s the client as the “person or party that engages (orders) the appraiser for the appraisal assignment.” This may or may not be the person who paid for the report. Usually, it is not.

If a Mortgage Broker orders an appraisal, the Broker is the client of the appraiser, and the homeowner is the client of the Broker. There is no client relationship between the homeowner and appraiser, regardless of who pays for the appraisal. It is about who keyed in the order.

This concept can often upset a homeowner, so understanding the appraiser ∕ client relationship will help you manage the expectations of your client in advance—before they say, “Well, I paid for it, so I want a copy.”

In order to release a copy of the appraisal report to anyone, including a lender, the Broker requires the appraiser’s authorization. This usually comes in the form of a Letter of Transmittal (lot)—or to use the latest term, a “reliance letter”—to permit a particular party (lender) to rely on the report.

Why would an appraiser not want the homeowner to have a copy?

An appraisal report is a private and confidential document between appraiser and client (usually the Broker or the lender) and is not intended to be circulated outside this relationship without written permission from the appraiser (lot). The report is written with the specific client in mind and the appraisal costs and the verbiage included in the document are reflective of that.

Unlimited Liability

The Appraisal Institute of Canada (AIC) requires its members to limit their liability, wherever possible. Appraisals are prepared for a specific use, and the appraiser’s liability increases with each additional use of a particular appraisal report. When a homeowner obtains a copy of an appraisal completed for a Broker or lender, the appraiser has no control over how that appraisal may be used in the future. The appraiser then inadvertently assumes undetermined additional liabilities, over and above a simple mortgage appraisal.

If you have received an apprasal servivce as part of your mortgage financing and would like to get an appraisal completed for your own records, please contact us and we will be able to quote a new appraisal fee (most likely discounted) based on the type of appraisal and purpose of the appraisal.

Let us know if you have any questions, happy to help!

Sincerely,

info@adlawappraisals.com

604-809-8506 (call or text)