Why does the appraiser have to take pictures of every room in my house?

Why does the appraiser have to take pictures of every room in my house?

If there were two topics that most home owners show concern about it would be a messy house and the fact that the appraiser has to take pictures of every room in their house. I’ve talked about the messy house issues before so today I thought I would tackle the curiosity about pictures. While the answer to the question “Why does the appraiser have to take pictures of every room in my house?” is pretty straight forward and simple I thought I would take time to discuss it since it is such a concern with homeowners, so let’s dig into this topic.

A picture is worth a thousand words

I’m sure that you have heard this old adage before but it is true. The appraiser is given limited space in which to describe the home they areappraiser pictures
appraising as well as its condition, however by including pictures the reader is better able to form a more accurate image of what the home looks like, and the pictures back up what the appraiser writes about in the appraisal report. By including pictures of every room you can see if construction quality is consistent throughout the home. I’ve appraised home where the owner built out either an attic or basement area but they did it themselves and the quality was not the same as the rest of the home that was built by a licensed contractor. These types of areas would most likely be given less consideration. You can also see what type of construction quality the home is as well as particular features of the home such as crown molding, chair rail, type of flooring, and built-in features like entertainment centers, etc.

Appraisers are under increased scrutiny

Ever since the real estate market crashed banks have lost a lot of money on loans where the home was not valued correctly and the features and quality of the home were not stated correctly. In an effort to understand the quality of collateral that their loans are secured by banks have increased the requirements from appraisers and the number of pictures is one of those things. In previous years the only photos that were required in a report were the front, back, and one or two street scenes, however this has increased to pictures of every room, every side of the house, street scenes, and any type of damage or items that need repair. Appraiser must take extra effort not to include items within the pictures such as a religious items or family photographs. The pictures are studied by bank underwriters to see if they match up with the written description in the appraisal report. The bottom line is that the appraiser must make sure that they provide a clear, accurate, and detailed description within the report that is then backed up by what is shown in the pictures.

Pictures help support value

appraiser pictures 3In addition to the above mentioned reasons pictures can add support for the opinion of value that the appraiser came up with in the report. Many times the appraiser will reconcile the final value estimate at either the upper end of the value range or the lower end and pictures can provide support for either of these choices. Sometime the quality and condition of a home may be such that the value estimate puts it at the upper end of the value range and to someone that has not seen the home this may seem unreasonable, however by including pictures of features and quality of construction that add value it makes it clearer and more understandable to the reader of how you appraised the home at the upper end of the range. On the other hand if the the home was appraised at the lower end of the value range pictures of needed repairs or amateur workmanship can provide support for this decision.

Question

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Comments

  1. I agree with others about the unnecessary invasion of privacy, especially when potential loans are no where near the property value. If the owner is being taxed for a $500,000 piece of property and looking for a $50,000 loan, I really don’t think interior photos are necessary to show the collateral will cover the loan amount.

    The requirements below ( bathrooms, kitchen, main living room, deterioration, upgrades) are acceptable to me if the underwriters must have photos, but every blessed room is not when a house is not on the market and personal property takes up more of the photo than the :”room’s structure.” A photo will absolutely not show the quality of the sheetrock or if the moulding is wood, composite or plaster. There are faux finishes that look like marble in a photo. Is it brick or just looks like brick? Oh, in the written description, huh? The appraisers written description is more reliable than a photo when it comes to the quality of materials used in the construction of the house and visualization of the room. Hard to judge the room from a photo when all of the personal items are covered with sheets, including anything hanging on the walls that would not convey with a sale. Thorough notes during the inspection with drawings/sketches are sufficient to jog the memory after a few days. Photos of every room sure is the easy way to keep from writing a bunch of notes down, not to mention it cuts down on the time spent at the property. Banks are hiring professionals to do a job, but a lack of trust requires a ton of photos of the contents of houses? I don’t buy that one either.

    Not all banks make their guidelines easy to find on the internet and most refer to Frannie Mae, Freddie Mac, VA, FHA plus a few others. The banks will tell you that they have to have photos of every room, but what they say is not always what the guidelines show and most of the time the mortgage brokers are going by what they have been told versus reading their own guidelines. Consumers must research what they are being told and ask questions up the chain of command. It seems nobody at the banks can say with certainty what happens to those photos that contain more personal property than house interior over time. And what about the phone, camera or iPad that took the photos or the computer that the photos were uploaded onto. Security of personal belongs shown in those photos is absolutely lacking. We hear about data breaches in healthcare, banks, etc. If the photos were transferred digitally, there are copies left on the net as they made there way through cyberspace to their final destination. Even encrypted files have the potential to be hacked.

    From Suntrust Nov 2018 Appraisal Guidelines -Single Family Residence- pg 28
    Uniform Residential Appraisal Report (Fannie Mae 1004/Freddie Mac Form 70) (UAD),
    Residential Appraisal Report (Fannie Mae 1004/Freddie Mac Form 70) (UAD), (continued)
    Required Exhibits  A street map that shows the location of the subject property and of all comparables that the appraiser used,  The building sketch shall include all completed levels above grade within the dwelling, all basement area (both finished and unfinished) and any finished living areas that were not included in gross living area, but were given value by the appraiser, such as detached accessory units, carriage houses, living area above detached garages/barns, pool houses, game rooms, studios, etc.  A floor plan/building sketch with exterior dimensions is required on all transactions.  If the floor plan is atypical or functionally obsolete, thus limiting the market appeal for the property in comparison to competitive properties in the neighborhood, a detailed floor plan sketch showing interior walls, doors, and interior dimensions is required.  The appraiser must also include calculations to show how they arrived at the estimate for gross living area,  Clear, descriptive photographs (in color) that show the front, back and a street scene of the subject property, and that are properly identified. Photographs must be originals that are produced either by photography or electronic imaging,  Clear descriptive INTERIOR photographs of the following:  kitchen,  all bathrooms  main living room  examples of physical deterioration, if present, and  examples of recent updates, such as restoration, remodeling and renovations, if present.  Clear, descriptive photographs (in color) that show the front of each comparable sale and that are appropriately identified. Generally, photographs should be originals that are produced by photography or electronic imaging; however, copies of photographs from a multiple listing service or from the appraiser’s files are acceptable if they are clear and descriptive.  Closely cropped photographs are not acceptable unless accompanied by a full explanation as to why the photographs are being presented in this manner.  Any other data, as an attachment or addendum to the appraisal report form that are necessary to provide an adequately supported opinion of market value.

    • You bring up some good points but the thing is that the banks make the rules so if you want to borrow money from them and if we as appraisers want to provide appraisal services to them we have to play by their rules. We may not like the rules but they have them for a reason, which is to reduce their risk. All of the information we provide to them as appraisers help them to know more about the collateral they hold in order to loan the money. Appraisers don’t really have a lot of say so in dictating how banks run their business. Thanks for sharing your thoughts.

  2. George Sanders says:

    As the tenant I found the “appraisal process” to be VERY invasive (and illegal?!). Why would an appraiser need to take photos of MY PERSONAL property?! The appraiser and my landlord didn’t notify me that there would be photos taken of my personal property and belongings. If the purpose of an appraisal is to support the appraisers report of the structural quality etc. of the building (which is what the the equity loan is based upon) then why didn’t she take photos of the actual building such as the ceilings, the floors, close ups of windows and doors, to show the BUILDING’S condition, in place of photos of my furnishings and collectibles. You also said it may be a while before the appraiser writes up the report and photos help to recollect details of each property. Well to that and you, I say – bull! That’s pure laziness on your part. You’re an adult – doing an adult job and getting PAID for this, so WRITE descriptive notes of each room in the unit; then take photos of the actual building’s property, NOT the tenant’s PERSONAL belongings. You said the bank requires photos, even for home equity loans? Well, there ARE appropriate photos to take to SUBSTANTIATE the BUILDING’S structure to meet any lender’s requirements. The loan is NEVER based upon the PERSONAL items, but of the REAL (estate) PROPERTY. The tenant should also have been given proper notice (by both the landlord AND appraiser – BEFORE he/she entered our personal domain that they would be taking photos of our personal properties) in order to for the tenant to have time to remove/cover up our personal valuables and whatever other personal items we don’t want included in any of your photos. And since photos of MY personal property were taken for YOUR professional benefit and convenience, then YOU should at the least, be paying ME and every TENANT a fee for our our unauthorized contribribution to the success of your appraisal process. As far as the lenders go, if they insist on photos, then they too, need to formally pre-notify, in writing of the upcoming date and time of their “required” photos as part of the appraisal process. The lenders then too, should also be required to pay the tenants for any photos taken of any our personal properties; it costs the tenants both time and money to prepare for this appraisal process, in order to protect our privacy! This appraisal process only benefits the LENDER, THE LANDLORD/PROPERTY OWNER and YOU, the APPRAISER – FINANCIALLY. The TENANTS are the only ones who must PAY the cost for all of you, both emotionally and financially!

    • Mr. Sanders, I understand your frustration with the process. As appraisers, we do not make the rules we only follow what our clients want. I always let the customers I work with know that I have to take interior photos and it is up to them to notify the tenant. Lenders have increased what they require over the years. In the beginning, we only had to take a front, back, and street scene photo, however, we now are required to take pictures of every room and anything that needs repair. Again, this is a bank requirement and I really don’t know what anyone can do to change this.

  3. I just applied for a new mortgage to refinance at a lower rate with the same shocking feedback- that they want someone to take pictures of every room in the house as part of an appraisal. This is unbelievable. I agree with the others who posted here that there is no way they are doing the same with comps and it adds no value to an appraisal for a professional that knows the local market and does their homework. My wife has been a wreck over this and has spent the week cleaning and dusting every room. When the market turns I will do my best to splash this about this bank all over social media. I hope that everyone else who has to go through this will do the same about putting up negative ratings of their bank. Frankly, it’s a total invasion of privacy and completely unacceptable. I’d like to see everyone that is backing this practice be run out of business by a competitor that looks at this cheap practice as being absolutely customer unfriendly.

    • As far as I know, every bank that requires an interior inspection appraisal requires the pictures. I don’t think you will be able to find one that does not, it is just the way things are these days.

  4. Should the appraiser provide a privacy statement before entering the property and taking pictures?

    • I guess it is something to consider but I don’t think anything detrimental has ever come from taking interior photos. I’m sure the homeowner waives their right when obtaining a loan because the bank makes it a requirement for the appraiser to take the photos so they can see what their collateral looks like.

  5. I have just had this done this week. And to be honest. It was very upsetting. I didn’t know of this rule of pictures and truthfully I hate it. I didn’t think it was even needed. I will tell you. I asked for a home equity loan of $50,000. We have a nice house give or take 200,000-250,000. And we sit on 40 acres with a 7 acre pond. We have less than one year to finish paying on our original loan. Now, excuse me, I’m now expert but I know what an acre sells for. And our 40 was more than enough to cover our loan with ever stepping foot into our house. Heck, without there being a house. I’m with the others, when they say, if a real estate agent can do it without and a tax assessor can do it without, there is no reason you can’t. Even if we wanted to contradict the appraisal it still wouldn’t make any difference. Having a picture to validate your opinion is irrelevant. Is someone you show it to, going to look at the picture and say, hey I think that house is worth more… And you come back and tell me this guy at the office I showed your bedroom picture to thinks your house is worth more. Really???? You are not taking pictures of the house. You are taking pictures of the contents. And that has no importance in the use of getting the value of the house.

    • The items you are talking about are requirements of the lender. The appraiser just follows the request of the lender when inspecting the interior and also the pictures. I will say that inspecting the interior makes for a more accurate appraisal because the quality and conditon of the home can be viewed and the square footage of the home is verified.

      • Quick question, we are renting a house getting an appraisal done for the owner. Appraiser came by took pics of every room but the master since my husband was sleeping sick and I wouldn’t let her disturb him. Now she has to come back to get the picture of the master, does she have to do the whole house all over or can she just take master bedroom pics and add them to the older ones?

        • By the way I live in Las Vegas and this is for a refinance for owner

        • They should be able to just add it to the old one. Lenders these days require pictures of every room. I guess she thought they might accept it without the picture since she did not want to disturb your husband but apparently they would not. I try to inform the occupants before going out that I will need to get in every room to look around and take pictures.

      • paulette scott says:

        maybe so, but we were not told that photos of the interior would be required, therefore we did not tidy up. Also, the appraiser just helped herself to the house, without our accompanying her. not right. to add insult to injury, she told us our pool devalued our property by $10,000 without giving us a reason.

        • Appraisers are required to fulfill the requirements that our clients have requested. Housekeeping type things do not hurt the value of your home only structural items that may need repair. Appraisers generally should not comment on conclusions while at the property because all markets are different and until the appraisal is complete it is difficult to say if a certain type of improvement adds to or detracts from a home’s value.

          • Housekeeping might not hurt the value if the appraiser does not let the housekeeping alter their judgement of your home value.

            All appraisers over the years have been great, except for one lady that immediately looked at my messes from stashing and piling so work could be done on the house and the look said it all. Her whole facial and body expressions spoke volumes and she was curt and discourteous in every way. When she left, her feeling remained for awhile and really made me feel bad about myself and my housekeep. As a crippled, senior citizen, I felt violated by her actions. I hope training teaches them to be more understanding of the feelings of the people that are not guilty but made to feel that way.

          • Sorry to hear about your bad experience. Most appraisers are trained to look over housekeeping and focus more on the structure of the house because that is what we are appraising. With that being said, the appraiser should be able to view all areas and surfaces of the home. I did an appraisal once where a bedroom had so much stored in it that I was not able to view the walls or floors to get an idea of what their surfaces were and what condition they were in. I hope your experiences in the future will be better.

  6. Pictures are not needed. If banks can’t trust appraisers to do their job correctly then they need to change the job. As written above, pictures help the appraiser to remember the home he looked at hours ago. I should not have my privacy and security weakened because an appraiser was to lazy to write good notes. Here is another point…..how are appraisers really comparing with comps? They are not going into the comp’s houses and taking pictures of every room or noting how the construction and condition come together. Houses were appraised for decades without pictures. The bank only needs to know what the house is worth so they can determine if their secured interest is really secure. If they had 100% faith and trust in the person determining the value there would be no reason for anything else. The real problem is that appraisers don’t have that kind of trust or reliability in the housing industry. That is a shame.
    I don’t see the tax accessor taking pictures of my home and every room and they are able to come up with a value of my home.

    • I’ll have to disagree Steve. I believe in the old adage that a picture is worth a thousand words. Including pictures can help paint a more complete picture of the property being appraised. They also help an appraiser when putting the report together. An appraiser may inspect an property on one day, but due to workload, etc. they may not get back to actually putting the report together for days. When you look at a lot of properties they sometimes run together, so it is not about the appraiser being too lazy to take good notes but about collecting the most detailed information possible, including pictures.

      Appraisers are able to view the inside of the comparables they use by looking at pictures included in the MLS listing. Most agents include 20-30 pictures with their listings which gives the appraiser more ways to compare condition and quality of construction.

      I think that the trust issue banks have with appraisers is a reflection of the banks desire to have as much information about the collateral they hold as possible. Their guidelines have gotten much stricter, such as credit, because some banks lost a lot of money in the last recession. With the stricter guidelines comes more requirements for appraisers and the bad thing is that appraisers fees have not really increased to reflect all of the additional work. Thanks for sharing your opinion Steve.

  7. As a homeowner having this done for the second time, all I can say is that it is very upsetting to have someone come in and take pictures of every room. This is a total invasion of privacy. It is bad enough having someone coming in and inspecting every room, but the pictures are just way over the top for me.

    • I can understand how you feel, unfortunately the banks and mortgage lenders that appraisers work for pretty much set the rules for this and we have to do what they ask. If we do private appraisal work this is not necessary.

  8. Robert Johnson says:

    As a homeowner, I find this practice of photographing interior rooms a troubling privacy issue.
    I’ve collected several original paintings by known artists, antiques and collectibles from my travels outside the country.
    There have been home invasions in my neighborhood. How easy that a thief would be able to identify, not only the most valuable items, but know exactly which room they were in, and the most direct route. Thieves generally do not want to spend much time burglarizing a home. The longer they are inside, the more chance they can be caught or discovered. These interior appraisal photos give them a restaurant menu and map to the best things!
    I can understand if the house were empty, not moved in, but taking pictures showing, not only expensive items, but the layout and location of security system cameras.
    Will your bond or liability insurance cover the losses of any break-in in perpetuity?
    There is no excuse for this invasion of privacy, unless you’re also working with the NSA.

    • Thanks for your comments. You make some very good points, however appraisers are required to do this as part of their assignment conditions. Appraisers go through background checks so I don’t think you should have anything to worry about with them and I have never heard of any problems with the types of issues you are concerned about.

      • Robert Johnson says:

        Do the secretaries and custodians (office help) go through similar “background checks”?
        Will the appraiser face any litigation should his/her office or computer system be compromised by a burglar or hacker?
        One appraiser equated confidentiality with that of lawyers and doctors. Doctors that do not safeguard their records can be in violation of HIPPA rules and face fines and criminal prosecution. Lawyers that leak information can be held in contempt of court or be held on more serious charges.
        Would appraisers even notify the homeowners if these confidential files and photos go missing?
        The homeowner has no control over the security of these files, nor any recourse if they fall into the wrong hands.

        • That is a very good question. At the current time I am only familiar with the requirement for appraisers to go through background checks. I have never heard of any such litigation that would set a precedent similar to what you say about doctors and lawyers. I don’t think there has ever been an issue with the type of scenarios you speak of, however if something occurred in the future there may be some standards put into place that address these issues.

          • My only question is this. Everyone seems to have this issue with appraisers. Do you know the background of your realtor? Also realtors spend more time in the owners home if showing they may not even be in town. A person could just do a showing and gather all they want from a home than from an appraisal. An appraisal is not made public. Also my appraiser blurred out people and pictures and personal items for tha privacy of the homeowner. He has even shown me where he has had requests of the underwriters for clear pics but refuses to provide due to privacy. However he goes through many issues because of this. The complaint should really be directed at the lenders as they are behind the request and if the appraiser does not provide they are then no longer used. It is not the lack of trust of appraisers it is the lenders trying to control values as well. Meaning they often dictate and question appraisers about how they value a home. Even if an appraiser may believe your home is worth more they are restricted to lenders requirements. As my friend has told me appraisers get more blame as they are like a scape goat to the lending industry. And unknown to many appraisers are liable for issues and have faced many lawsuits which is also why pictures are used to prove their point and condition of home at time they were there. I think it is an area where people do not know much about the profession or all it entails good and bad.

          • You make some great points Brett. Scope creep by lenders has made its way into many loans and they make outlandish requests of appraisers. You are right that many people do not know about this. Thanks for sharing your thoughts.

  9. As always, great blog post. I will just add that I, as a practice, do not take photos of bedrooms unless there is something about that bedroom that is unusual or important. I know that some lenders require bedroom photos, but I no longer do business with any lenders that require it (I even had one lender ask for closet photos, now that is crazy). The reason that I do not take bedroom photos is because there is almost nothing useful to be seen. Typically a bedroom photo will show a bed and a window or a bed and a closet door (depending on the angle). In either photo angle (unless we take two photos of each room), I don’t have a very good document that the room is actually a bedroom. Additionally, when taking a picture of a bedroom, I am taking a picture of a place that many people find very private. If the bed is not made, it can look to a third party user of the report (like a bank) that maybe the house is not well cared for and it is often wrong to draw that conclusion from a messy bed. It is very difficult to see anything condition related in a bedroom photo unless there are tears in the carpet or something quite noticeable (in that case I would take a photo). Likewise, it is difficult to see anything quality related in a bedroom photo unless the house is of very high quality and has architectural features in the bedroom. In most bedrooms, the only features that could get updated are paint, moldings, flooring, and doors. These are factors that, if the house is overall consistent throughout, should be quite visible in other photos and might not be too visible in a photo that just shows a bed and a window.

    • You make some good points Gary. I know that in some pictures you cannot see much except for the bed like you say. Going along with what you said, on appraisals done for individuals interior pictures do not have to be included, as that is a stipulation of the lender. I always take a lot of pictures on every assignment so that I can document for my own recollection what the property was like to recall what type of condition it was in.

  10. On a practical note photos are key to help me remember the property when I get back in the office. This is true when doing an appraisal for a loan, but it’s also true with other types of work where I might not be completing the appraisal right away after the inspection. For instance, I have a stack of properties for a litigation case on my desk right now that I inspected probably 4 months ago or maybe more. This won’t go to court for several more months either, so it’s crucial to have photos on file to help serve my memory.

    • Great point Ryan! It’s amazing how properties start running together, however with photographs we can have excellent recall and document the property more accurately in the report. Thanks for sharing.

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  1. […] but now this has expanded to include much more. A comment on a previous post I wrote about why appraisers take pictures of every room in the house prompted me to explain a little further about what items an appraiser takes pictures […]

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