In one sentence
The independent professional valuing the property under USPAP standards for the lender's underwriting.
The longer version
The appraiser delivers the value the loan is sized against, weighing income, sales, and cost approaches. For regulated lenders, the appraiser must be engaged independently of the production side.
Appraisal timing and review sit on the critical path, and the appraiser's NOI and cap rate assumptions feed straight into loan sizing.
Common questions
- Who hires the appraiser for a commercial loan?
- The lender. Federal rules require regulated lenders to engage appraisers directly to keep the valuation independent of the borrower.
- What standards does a commercial appraiser follow?
- USPAP, the Uniform Standards of Professional Appraisal Practice, plus the lender's own appraisal requirements.
- Can a borrower provide its own appraisal?
- A regulated lender generally cannot rely on an appraisal ordered by the borrower, though it may review one as information.
Keep reading
- The due diligence checklist, built to be runChecklists as systems, not documents.
- The commercial loan closing processThe five stages from term sheet to funded.
- The commercial loan closing checklistWhat goes on the list and who owns each line.
- Commercial loan softwareWhere this sits in the lending stack.