Real Estate Appraisals and Pickett's Charge at Gettysburg

After my house burned down in 1992, I hired a “public adjuster” to battle the insurance company. My wife loathed him. “He’s a low class, ambulance-chasing, asshole,” opined my darling Christine. “Yes, my Dove, but he’s MY low class, ambulance-chasing asshole.”

The asshole, whom I shall refer to hereafter as “Bubba” taught me many interesting things about how the world worked. Of particular interest was his guidance in negotiating a settlement for Christine’s mommy van that, parked in the garage, melted down to the rims in the fire.

Now, what does this have to do with real estate? Stick with me. Wait for the pay off. It’s gonna come, you bet.

Bubba sez:

“Most people in the insurance biz, especially the adjusters, hate their job. They’re underpaid, overworked, abused, unmotivated, and lazy. You need to take advantage of that. Do their work for them. Make it easy for them. Build a bullet-proof case for them, wrap it in a bow, and give it to them so they can look good in front of their supervisors. Before you meet with them the first time . . . Hey, Bob! Are you listening to me? Snap out of it. . . . Before you ever sit down with them, put your request, your demand, your proposal together in writing. Get out to the car lot; find the “real” replacement value for your year, make, and model, not the “blue book.” Get the salesman to write down the total, out-the-door cost for you, extended warranty, undercoating, taxes, registration, the whole thing. If you have good maintenance records, put those into the proposal as well to demonstrate that the car was in cherry condition. If you have a good photo, add it too. Put it all together and make it look as formal and intimidating as you can.”

Here comes the punch line.

You have to get your number on the table, before the adjuster gets her number on the table.

This is absolutely critical. If the adjuster goes through the effort to generate her number, then you have put her in a position where she must defend herself and her number. You are attacking uphill against an enemy already entrenched on the high ground. Remember Pickett’s charge at Gettysburg?”

OK, stop for a minute. Bubba didn’t really rap about Pickett’s charge. That’s all me just getting carried away. Bubba don’t know squat about Gettysburg.

Bubba, annoyed with my interruption, continues:

“You need to be the one entrenched behind a bullet-proof proposal. Make the adjuster have to prove that your number is wrong. Make her attack uphill. Oh my dear adjuster, that sounds a lot like . . . work! Sounds like conflict and confrontation. Stress. Energy. Danger. What if you get your lawyer involved? Or worse. Bubba the Asshole?”

Following Bubba’s wise council, I arrived at the claims office with my impressive written proposal and politely insisted on $13,000 for the van. The adjuster, consulting the “blue book” sputtered that the high blue book value was only $11,000. I presented my hard evidence that it would cost me $13,000 to find an exact replacement. More sputtering and fifteen minutes behind closed doors with her supervisor . . . and my formal proposal . . . she returns with the news that the most they can go for is $12,000.

Not even cracking a smile, I solemnly shake hands. It’s a deal. $1,000 above blue book.

Real Estate. We are worried sick that the appraisers, under the regulations of HVCC (the Home Valuation Code of Conduct) will undervalue our properties and kill our transactions. I suggest that, rather than sitting around passively and hoping that the appraiser’s number will support your price, you prepare a bullet-proof BPO (Broker Price Opinion) yourself with all the documentation you can provide, anything and everything that supports your price. Make it thick. Make it formal. Make it intimidating. Make it look really sharp. C’mon do the work! This is more than “showing up with the comps” and talking a bunch of bullshit with the appraiser.

You must get your hard evidence on the table before she does!

Make her attack uphill against your defenses. Give her everything she needs to make your case for you.

Do it all with the grace and elegance of a refined lady, a southern gentleman.

What if the appraiser won’t even take your documents? She’s snotty and arrogant. “Don’t try to influence me!” If her number comes in too low, you may have to challenge the appraisal. To do that you will need a solid case. Guess what? You already have it! You will be counter-attacking downhill with all your evidence in good order. Poor General Pickett. He never had a chance.