If you've ever been blindsided in court because an appraisal fell apart under scrutiny, you know how costly that can be for your client. The difference between a defensible appraisal and one that crumbles often comes down to one thing: clear, documented methodology.
After testifying in dozens of cases, I've seen the same issues repeatedly torpedo otherwise solid valuations. Here's what you need to know to evaluate any appraisal before you rely on it in litigation.
The biggest problem I see? Appraisers who lean on their expertise without explaining their reasoning.
You'll read through a report and see adjustments made for square footage, condition, garage count, or market trends. But when you look for the rationale behind those numbers, there's nothing. Just the adjustments themselves.
If the adjusted comparables all fall very close in line, you might infer the adjustments are credible. But you'd have no idea how they arrived at those numbers or why they made those specific choices.
It gets worse when you see a property appraised at $800,000 with an adjusted value range from $650,000 to $1,000,000. The appraiser made adjustments, but without explanation, you're left wondering: how did they calculate the per-square-foot adjustment? What about view or location differences?
Here's what happens when I'm on the stand and the opposing attorney questions an appraiser without solid documentation:
Opposing attorney: "Can you explain to the court how you came up with the $75 per square foot adjustment?"
Appraiser without documentation: "Well, that's based on my experience. I've been doing this for 20 years."
That sounds like opinion.
Compare that to what I can say:
"I analyzed 15 sales in the area over the last 18 months. The price-per-square-foot difference between similar properties averaged $73 to $78, so I used $75."
One is opinion. The other is analysis backed by data.
In most appraisals, you'll see adjustments for:
When an appraiser doesn't explain how they calculated one of these adjustments, they typically haven't explained any of them. The entire report becomes questionable—it looks like they're backing into a number rather than letting the data guide them.
In my reports, everything lives in the supplemental addendum. That's where you'll find:
This documentation means the report stands on its own, even without my testimony. The reader can clearly see the reasoning behind every decision.
When I've testified against other appraisals, the main problem is always the same: the methodology isn't documented anywhere. Comp search criteria, adjustment calculations, selection rationale—none of it's in the report. The reader is left guessing.
Beyond missing explanations, here's what should concern you:
If comparable properties have different square footage, garage configurations, or condition levels, but no adjustments are made, that's a problem. There are rare cases where no adjustment is needed, but generally speaking, differences require adjustments.
Let's say an appraiser makes a $50 per square foot adjustment for size differences, but the adjusted comparable range is still $50,000 wide. This likely indicates they needed larger adjustments or additional adjustments for other factors.
For a $500,000 property, you generally want to see the adjusted comparable range within about 10% ($50,000 or less). That's a common benchmark because most lenders would have issues with anything larger. But smaller is always better - a range of 5% or 2.5% indicates a much better-supported valuation. The tighter the range after adjustments, the more confident you can be in the methodology.
No addendum with methodology? That's your biggest red flag.
If you've received an appraisal and have concerns about its defensibility:
Better yet? Vet appraisers upfront. Make sure the quality of work they deliver meets your standards before you're standing in front of a judge.
A defensible appraisal comes down to clear methodology and documented reasoning. When every adjustment is explained, when the statistical analysis is transparent, and when the comp selection rationale is spelled out, judges can follow the logic.
That's what separates appraisals that hold up in court from those that don't.
