Focus on the investment law: FIRREA and its effect on the investment community.

* Be cautious regarding advice from bankers. Most banks have recently installed firewalls between appraisal review and loan production functions. Therefore, the people the investor interacts with may not have relevant knowledge or the control they represent; the deal could be delayed by people the investor will never meet.

* Though FIRREA affects all federally regulated lenders, the impact on their customers seems to come in varying degrees. Do some research beforehand about who will be able to respond to investor needs if the deal requires the lender to move quickly.

* Some real estate counselors are also appraisers. If using the services of a counselor/appraiser, understand that providing counseling services will probably preclude that person from appraising the project for a federally regulated lender.

* Related to the point above, if using the services of a real estate counselor, his or her expertise can still be of value in the appraisal process. Few lenders would prohibit the retained counselor from communicating with the hired appraiser. Similarly, providing a well-prepared market study to an appraiser unfamiliar with the deal can go a long way in heading off misunderstandings about the project.

BY BRADLEY R. CARTER, CRE, AND DORI D'ESPOSITO BOWER

About the Authors

Bradley R. Carter, CRE, is a principal of Greystone Valuation Services Inc., an Atlanta-based real estate counseling and appraisal firm. He has published articles in numerous real estate, lending and legal journals on a variety of topics including standards compliance in appraisals. He also holds MAI and CCIM designations

Dori D'Esposito Bower is a principal in Greystone Valuation Services Inc., an Atlanta-based real estate counseling and appraisal firm.

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