A Few Things you Might Need if you are going to do Appraisal Expert Witness Work

With the downturn in the mortgage lending world, many appraisers are scrambling for more non-lender business.  One aspect that is appealing to some is that of Expert Witness Testimonies.  Many trials or depositions need a real estate appraiser to perform expert witness services.  This can be a fun and lucrative form of work for those who are interested.  However, there are a few things that you will need to do before you can qualify.

Obviously, you will need experience (and a lot of it) in the types of appraisals required for this particular form of non-lender work.  Keep detailed records of all your experience to build a marketable resume.  An attorney (potential client) will want to know what yourAppraiser Expert Witness specific experience is.  Being a member of professional organizations, earning designations, and having published articles in professional journals will also be helpful.  Most lawyers will want to see your curriculum vitae (CV) sheet.  Don’t know what that is?  Google it and get one prepared.  You will need an amazing resume filled with as much education, experience, and specialties as you can get.  Make it shine, but be honest.

Finally, you will want to decide how much to charge and how to work billing.  It is standard to require a retainer fee (say $1,000) up front and then to bill on an hourly basis usually figured in 1/10th of an hour increments. Often there is a different hourly rate for research time and testimony time.  As an appraiser associate of mine recently put it so well, “when the tie goes on,” the rate goes up.  Do not be afraid to ask for what you are worth.  Do not undersell your services and be the professional you know you are.

Now, go create some value!

6 thoughts on “A Few Things you Might Need if you are going to do Appraisal Expert Witness Work”

  1. Don’t forget to engage properly. Sometimes with courtroom work, someone different than the client will be responsible for payment. Get this in writing. Also, outline everything in the engagement including scope of work to be performed and certifications. Include a minimum of four hours pay if called to testify. If you don’t engage correctly, you could be exposed to liability and loss of fees. Please subscribe to my blog http://www.AQualityAppraisal.com/blog.

  2. Pierce Blitch III

    Well Said!!! This can aslo be some of the most satifying work that you do becauses your client REALLY DOES want to know what the value is on the property and you don’t have to jump through a bunch of hoops in order to satisfy a checklist.

  3. Make sure you have an arrangements for pre-trial conferences, additional research and waiting time. Yo may consder charging for stand by time.as well as court time. If you must reserve time you should consider compensation for waiting time or opportunity tme lost.

  4. It starts with the engagement letter and ends with court room testimony. The engagement letter helps outline your fee structure and what is type of report is going to be performed. It also is your ammunition in case you don’t get paid. Detailed inspection and data collection is very important along with photographs as these properties usually have issues. I also include an aerial photograph and charts because attorney’s and judge’s like to see things visually and it provides additional support for the opinions and conclusions presented. Most of my cases are settled prior to trial because I have provided a report that meets or exceeds their expectations. If going to court arrive early and be prepared. Focus on your strengths and try to minimize your weaknesses. Answer questions directly, but don’t get into hypothetical answers. Be confident and dress appropriately. You are a professional so look and act like it. I have worked for insurance companies, attorney’s, and government agencies and I find the work challenging, but rewarding. Great way to test your skills.

  5. Get paid up front for your appraisal work, consulting, deposition and trial prep, and any other work you have performed on a particular case. If you are not paid up front, then cross-counsel can attack your credibility for being a hired gun, e.g., “So, Mr. Appraiser, if you don’t give the right number, you don’t get paid. Am I right?” You’ll have an answer of course, but the trier of fact will be less inclined to believe you. If you’ve been paid, you simply say so: “I’ve already been paid for my work. I’m now testifying about the work I’ve already done. And I’m being paid on an hourly basis, just as you are, to explain my report here today.”

    But you won’t get that far unless you can be found and can get the work. Try advertising in the local bar association newsletters, for starters. Continuing Legal Education (CLE) classes that pertain to property can also be good places to meet lawyers that might need you. They’re pricey, but you’ll probably learn a lot, and you’ll make some contacts. Direct mail annoys lawyers just as much as it does you.

    For bankruptcy matters, make the attorney your client and make him/her responsible for your fee. Don’t accept payment, cash or otherwise, from the petitioner within 30 days of his filing; it’s called a “preference payment.” If the Trustee discovers that, you’ll have to pay your fee into the bankruptcy estate and proceed as an unsecured creditor.

  6. When it comes to litigation work, I always have a 3 phase engagement letter and request a retainer to cover the time and cost of phase 1 at a minimum.
    Phase 1–Consultation with attorney and client; inspection of subject property; review of surveys, zoning, building plans, operating history, and related data; preliminary market research; preparation of preliminary evaluation; meeting with attorney and client; verbal report to attorney. Requested retainer for Phase 1 $————‘ (This phase can be billed at a flat fee or hourly rates against the retainer)
    Phase 2–Preparation of appraisal report in conformance with USPAP regulations and employment of applicable valuation approaches and setting forth property detail, market analysis, highest and best use analysis, analysis of market data employed, electronic submittal of report together with 2 bound copies of report. Total flat fee for completion of Phase 2 $————. (Again, this phase can be billed at hourly rates–including those of any appraisal assistants)
    Phase 3–Meetings, conferences, preparation for depositions and trial; appearance and testimony at deposition and trial; review of personal transcripts; review and comment as may be requested concerning other transcripts and related exhibits; additional consultation with attorney for purposes of preparing rebuttal testimony; appearance and rebuttal testimony if requested. Phase 3 will be invoiced at appraiser’s hourly rate of $—– for above work, court standby time, and other tasks as may be requested by attorney.

    All invoices must be paid before deposition and/or trial testimony.

    By use of this engagement letter, the client knows that they will not have to pay for a documented summary appraisal report if the verbal valuation is not helpful to the client’s position. It also removes pressure from appraiser to accommodate client’s interests in order to get paid. By the time the appraiser is called to testify at trial, all previous invoices should be paid in full and the only unbilled time would be that expended at trial. It is always a good idea to keep detailed time sheets both for billing purposes and in the event of a dispute over fees. In the event of a suit to collect fees, a judge is always going to ask for proof of the appraiser’s time.

    It is not good business practice to get so deep into a case that when you find out you can’t help the client that you are in danger of not getting paid for your time. On the other hand, experience has taught me that once the client has committed to pay for Phase 1, the attorney and client will accept the findings of the appraiser and in the majority of engagements, will either try to settle the case or request the completion of Phase 2. A case can settle at any time during the pre-trial negotiations and/or preparation and that is why the appraiser should remain current with billing and collections. Experience has also taught me that if you can’t get paid by a client when they still need you–forget about it once they don’t need you.

    The idea here is to be a professional appraiser–but also be a good businessperson–especially in the litigation arena. You don’t want to have to expend as much time in collection as you do in preparing and testifying.

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