If a mortgage lender acquires the title to a property as the result of a foreclosure, the property is called an “REO” property, which is short for “Real Estate Owned.” REO properties represent business opportunities for appraisers, as property valuations may be needed for pre-foreclosure, loan workouts, short sales, asset evaluation, and more. However, inspecting these types of properties can be dangerous. Here are some safety threats to be aware of when appraising REO properties, and tips on how to avoid them.
REO properties pose their own unique set of dangers for appraisers. They are vacant structures, some of which have not been occupied in months or even years. They are magnets for thieves, vandals, vagrants, and drug dealers. REO properties can provide refuge for stray dogs, feral cats, mice, rats, raccoons, snakes, and other unwanted critters. They can also be infested with fleas, cockroaches, wasps, or other insects. Additionally, you may encounter environmental hazards such as mold.
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Safety tips for appraisers
While you should not live in fear when appraising REO properties, you should certainly be aware of your surroundings and take precautions to limit the danger. Here are a few safety guidelines:
1. Don’t visit the property alone
It is a good idea to take another person along when inspecting REO properties. If you must inspect REO properties alone, it is recommended that you provide your daily inspection itinerary to another person (colleague, secretary, family member, etc.) so that your whereabouts are known and can be tracked. For example, you might provide property address information to another person before entering a vacant property, and transmit a code word to that person when you leave the property in order to verify you have have completed the inspection safely.
2. Come prepared
Many appraisers carry pepper spray, mace, or devices that emit loud warning sounds. Such items can be useful tools for self defense if you find yourself in a dangerous situation. Additionally, it’s a good idea to always keep a few key items in your car, like a flashlight, bug spray, and extra batteries.
3. Leave if you suspect danger
If you see something at a property that makes you question your safety (e.g., hearing voices coming from inside a closed room of a vacant house), you should leave the property immediately and contact the authorities. Trust your instincts. When in doubt, remove yourself from the situation. No appraisal fee is worth endangering your safety.
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For more tips, check out our posts on How to Prepare for an Appraisal Inspection and 20 Things Every Appraiser Should Keep in Their Car.