In one sentence
An independent opinion of the property's value prepared to USPAP standards, required for regulated lenders under FIRREA above threshold amounts.
The longer version
Commercial appraisals typically weigh three approaches: income capitalization, sales comparison, and cost. For lenders the income approach usually leads, and the appraisal's NOI and cap rate feed directly into LTV and debt yield sizing.
Regulated lenders must order through an appraisal management process independent of production, and review the report before relying on it. Appraisal timing is a standard critical-path item.
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