If you have ever taken out a mortgage on a residence, you likely engaged an appraiser to value the property as security for that loan. This may have been a requirement of the lender or a precaution you took to be sure what you were getting. Apart from this common use of an appraiser, you may be surprised at how many situations may call for an appraiser and just how much you might benefit from using one.
Staying with the residence as an example, you would find an appraisal of a residence owned by a relative, such as a parent, useful in the process of valuing and settling the estate. Apart from the typical home mortgage and refinancing transactions there could be a reverse mortgage chosen for an older person needing access to funds. A family’s vacation home or second residence might require an appraisal for estate planning purposes as where the current owner plans to transfer the property to a qualified personal residence trust or other trust for the benefit of a number of family members.
If there is a family business or even a small business which includes non-family members, an appraisal of that business can be very important for purposes ranging from estate and succession planning to a potential sale of the business or even for reasons of insurance coverage for property or activities of the business. Even absent planning, a professional business appraisal may become necessary for income tax purposes to ensure you are not paying too much or undervaluing the business.
Similarly, most charitable gifts of any significant value must be appraised in order to satisfy the IRS and permit charitable deductions. Even if you are giving away your coin or stamp collection or perhaps some works of art to family members, an appraisal is necessary to value the non-charitable gift as well.
These are just some of the most common examples of property and interests which should be professionally appraised to protect the owner. Whether it is an airplane or an antique car, a boat or a mountain cabin, an appraisal will be useful in many respects. The cost will likely be well worthwhile.