Due to the low value assigned to my home by an appraiser, I didn't get a loan and it did cost money.

However, when I went to another bank, two new appraisers gave a higher value and I was able to refinance my mortgage.

  • Fair question. The situation is there are many houses sold since then around our area which show that recent appraisers are either appropriately or under valued the property. At the end of the day it's the comparables isn't it?
    – Iam
    Oct 6 '15 at 23:41

An appraisal is a professional opinion. As such, you can't sue someone for an appraisal and win, even if it is "low," unless the opinion clearly violated professional standards.

There are three basic methods of appraising a house: 1) replacement cost 2) multiple of rent and 3) "comparables," that is, what do similar houses in the neighborhood cost.

In an "ideal" world, the three methods would give similar values, but in practice, they often give very different values. That is particularly true between a "disciplined" appraisal method such as X times rent, and a more "subjective" valuation based on how "hot" an area is, and how many people want to live there, which might bring about a multiple, Y, higher than X (the general multiple) for just one area.

As long as an appraiser used an accepted method, he wouldn't be liable. The only way is if he used a totally unreasonable assumption, like assuming that a mortgage would have to pay an interest rate of say, 10% (not uncommon even thirty years ago, but out of place today).

  • Your opening paragraph is misleading. Professionals give opinions all the time and if they screw them up they can and do get sued successfully. "Professional standards" may demonstrate the discharge of a duty of care but not if those standards are inadequate.
    – Dale M
    Oct 7 '15 at 22:22
  • 2
    @DaleM I think that it gets to the #1 defense in these cases. You can't sue simply because his opinion was different from someone else's option. You would have to show professional negligence and depending upon who hired the appraise there might be a negligence liability waiver with the contracting party so one would have to show negligent misrepresentation which would be particular hard since the disclosed basis of the opinion would have to be negligent wrong, not just the conclusion.
    – ohwilleke
    Sep 5 '17 at 21:58

You can sue. You will lose.

The valuer doesn't work for you so you have no claim under contract. Under their contract the valuer's primary duty is to their client: the bank.

You could sue for negligence but to do so you would need to show (among other things) that:

  • They owe you a duty of care. Given that any duty they owe you is subordinate to the duty they owe the bank this is a long bow.
  • They failed in that duty. They must have been negligent in their valuation: do you have any evidence of this? A different value from a different valuer at a different time isn't evidence of negligence. If they did all that was reasonable for a valuer to do to arrive at their valuation then they weren't negligent.
  • You must have suffered harm. What did you lose?
  • +1, I think the major point here is "what did you lose". The whole premise of the lawsuit would be damages and since everything worked out in the end, it appears the answer is "absolutely nothing".
    – user900
    Oct 7 '15 at 1:52

You could try to sue for anything, right or wrong... but you'll probably spend more money on the lawyers and not get anything in return.

I would say best to just let it go, unless you lost more than $50k.

  • You are right. How about taking them to a mediator? There is one non-profit organization here.
    – Iam
    Oct 6 '15 at 23:43
  • Mediators normally get pulled in after someone filed a suit and they try to settle it off court. How much do you have in damages if the deal went through with the other bank?
    – VenomFangs
    Oct 6 '15 at 23:51

This could vary from jurisdiction to jurisdiction. Under the general principles of common law, if you hire an appraiser, and there is no contractual or statutory waiver of a right to sue, you would have to show that (1) there is the standard of professional conduct applicable to the appraisal profession in preparing the appraisal that requires the use of the best available comparables (probably with an expert witness certified as an appraiser), (2) the appraiser in this case engaged in conduct that breached the standard of professional conduct applicable to appraisers, (3) this breach caused you harm that was reasonable foreseeable at the time the appraisal was prepared, and (4) that you suffered quantifiable damages that were foreseeably caused by this breach of duty.

You would also have to show that there were no reasonable ways to mitigate the harm caused by the low appraisal (such as retaining another appraiser to redo it) and if there was a way to mitigate the harm you would be limited to the damages you would have suffered if you took that course of action.

Realistically, this would be extremely difficult, but not necessarily impossible to do. It would take really egregious facts and serious damages caused by the conduct to make the case stick, and I doubt that you could find an appraiser willing to testify as an expert witness that this conduct rose to a violation of the standard of care for an appraiser, even if it was not a case of "best practices" in the profession. And, showing that the appraisal caused you harm would be particularly difficult.

Maybe more facts of the case would make it sound more plausible, but for a case that would cost perhaps $75,000 of attorneys' fees and costs to litigate in the U.S. with no prospect of an award of those fees to you if you prevailed in the U.S. (except recovery of your filing fees, out of pocket costs and expert witness fees for things other than attorneys), and a risk of paying the other side's expert witness costs if you lost, the provable harm would have to be in the many hundreds of thousands of dollars and the mistake would have to be very glaring before that kind of case would make sense to seriously consider bringing. Also, often there are special procedural rules for lawsuits against licensed professionals that vary quite a bit from jurisdiction to jurisdiction, and there are often waivers of rights in listing agreements.


Most of the responses here are probably written by appraisers. I have successfully sued appraisers and won. In the south and north-east there is a pattern of discrimination where minority (people of color) home owners consistently got their homes appraised at a lower value. I simply filed a discrimination court case in our local court and requested the court to issue a subpoena to collect all of comps from same neighborhood and other neighborhoods that this appraiser has appraised in last 36 months. It took some research to identify but it was evident where the name of the home owner was Muslim or Jewish sounding this appraiser had consistently appraised those home 10 to 20% lower than the neighborhood comp. It did took about 80 hours of work on my part and $1100 in court fees to get the value of my home appraised correctly. I lost the contract that my house was under as the whole process took three months. However, the appraiser lost his license in the state of Texas.

  • Suing for discrimination is way different than the question asks. Presumably, this question has no such issue. "Fair housing practices" is almost entirely about the codified ways lenders can't discriminate.
    – 608
    Nov 19 '20 at 15:38

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