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Multiple Valuations (Second Appraisals, Replacement Appraisals & Second Opinions) for Clients

Purpose

This policy is intended to provide guidance on the appropriate use of second opinions of value and additional appraisal assignments. While there are legitimate circumstances in which obtaining an additional valuation is appropriate, decisions to obtain a second opinion should be based on documented business, underwriting, risk management, or quality concerns—not solely on whether a prior valuation supports the transaction.

As part of our commitment to appraisal independence, regulatory compliance, and credible valuation practices, we ask our clients to ensure that requests for additional valuations are supported by a legitimate business purpose. Doing so helps maintain the integrity of the valuation process and ensures compliance with applicable appraisal independence requirements, investor guidelines, and industry best practices.

The examples below are intended to illustrate common situations in which an additional opinion of value may or may not be appropriate. They are not exhaustive and should be considered in conjunction with applicable laws, regulations, investor requirements, and internal lending policies.

Common situations where a second opinion of value is appropriate include:

  • Material deficiencies in the original appraisal. The report contains significant errors, unsupported adjustments, incorrect data, or other issues that cannot be resolved through revisions or an ROV.
  • Credibility concerns. The lender or AMC has a documented basis to question the reliability of the value conclusion after a quality review.
  • Complex or unique properties. An additional opinion may be warranted because the property is highly atypical or difficult to value, particularly for portfolio lending or litigation.
  • Internal risk management. Some lenders have policies requiring a second valuation for high-balance loans, unique collateral, or elevated risk transactions. These policies should be applied consistently, not based on whether the first value supports the deal.
  • Regulatory or investor requirements. Certain loan programs or investors may require an additional valuation under specified circumstances.
  • A significant change in the property or market. If enough time has passed or the property's condition has materially changed, a new appraisal may be more appropriate than relying on the original.

Conversely, a second opinion is not appropriate when:

  • The only issue is that the first value is lower or higher than desired.
  • The lender hopes another appraiser will "see it differently" without any evidence that the first appraisal is deficient.
  • The first appraisal is credible and USPAP-compliant, but it doesn't support the transaction.

If questions arise regarding a specific assignment, our appraisal management and compliance team is available to discuss the appropriate course of action.