Types of Credentials for Appraisers

All appraisers are required to follow the Uniform Standards for Professional Appraisal Practice (USPAP).  Think of this as the check list that appraisers need to follow for every assignment.  Appraisers in the business valuation field need to take a 7 hour USPAP class every 2-5 years, while real property appraisers need to take the 15 hour USPAP class to enter the field.  We know that it takes a JD to become a lawyer, an MD or a DO to become a doctor.  What does it take to become a qualified appraiser?

First, let’s go with the IRS definition of a qualified appraiser.  An IRS qualified appraiser is an individual who:

    • Has earned an appraisal designation from a recognized professional appraisal organization, or has met certain minimum education and experience requirements.
    • Regularly prepares appraisals for which the individual is paid.
    • Demonstrates verifiable education and experience in valuing the type of property being appraised.
    • Has not been prohibited from practicing before the IRS in the last three years
    • Is not an excluded individual.

If you are looking for the requirement for real estate appraisers just click the third option on the menu to skip the business valuation information.


Qualifications for Business Appraisers

There are several competing organizations which have different sets of rules to join their ranks and become certified/qualified as an appraiser.  I’m going to focus on the ones that are recognized by the SBA.  All of these require at least a bachelor’s degree and many hours of initial training and experience.

SBA definition of a Qualified Appraiser

The Small Business Administration has criteria for who they allow to perform appraisals for underwriting SBA loans.   There are a few appraisal designations that are left out of their qualified list, which should be a clear signal that these are the only business valuation credentials which should count.

  • Accredited Senior Appraisers (ASA) from the American Society of Appraisers
  • Certified Business appraiser (CBA) from Institute of Business Appraisers
  • Accredited business valuation (ABV) from AICPA
  • Certified valuation analysts (CVA) National Association of CVA’s

Let’s look into the requirements to earn these credentials.

[wpsm_colortable color=”purple”]

Organization Credential Education Req CE Hours Experience Hours
American Society of Appraisers ASA Bachelor’s 120 10,000
Institute of Business Appraisers CBA* See NACVA 45 4,000
NACVA CVA Bachelor’s 45 4,000


*I didn’t realize this until I went to look at CBA requirments, but they were purchased by NACVA.  Which means that as the recertification process occurs the CBA designation will be phased out.  For the last decade or so no new CBAs should have been awarded.

I had appraised insurance agencies and dental practices for many years before I started the course work to get an ASA.  I knew that I could only go so far without a credential, I needed to basically be “under” someone in the corporate ladder.  Someone had to sign and supervise my work.  Had I been hungrier to move up the food chain I would have started on my formal appraisal education sooner.  Was I lazy?  Or did I just not know what I didn’t know?

I have to chalk this up as I just didn’t fully understand what I didn’t know.  My company was unwilling to pay for me to take the courses.  It wasn’t until I went out on my own that I started to invest in myself.  The four 26 CE hour courses aren’t cheap.  They require travel, and a few days off work for each of the modules.  Here is another tip the first two exams are easy, the next two are much more difficult.  So be prepared to study!

What benefits do Credentialed Appraisers Have?

It is a huge perk to be able to do SBA work for banks.  I generate about 20% of my business from banks and that’s revenue that I would hate to lose.  My five year reaccreditation window is fast approaching, and believe me I’m going to jump all of the ASAs hoops to ensure I don’t lose out on SBA work.

Having a business appraisal credential gives you a measure of respect.  Many potential clients do their research before they hire an appraiser.  Ask yourself, after a short google search are you more likely to hire someone with a business valuation credential than someone without?  Assume that the valuation assignment is the same cost, then you aren’t going to go to an untrained person when you could just hire a certified one.

Knowing that the ASA’s requirements are more difficult than the other organizations, I chose to go down that road.  The main reason behind my decision?  I didn’t want to walk into court and have a resume that was deemed inferior to the other party’s expert witness.  Being armed with an ASA makes it easy to qualify as an expert witness.  Of course, you need to get one case under your belt before attorneys will take the risk and hire you for their assignment.

I imagine that all judges, mediators, and arbitration panels know the difference between a credentialed appraiser and one without qualifications.  However, arguing that an ASA is more important than say a CVA most likely won’t be worth the effort.  I know that the ASA is more prestigious and difficult to attain, but I’m not going to bust out a chart and tell the judge that the other guy isn’t qualified to sit in the same chair as I am.

However, I do get a nice chuckle when I’m in court against a broker and the judge asks him about his business valuation training and experience.  Rather than trying to outshine the other side, just sit back and let them explain their lack of experience.  In the end, the judge will understand that the other party brought a knife to a gun fight.

Qualifications for Real Estate Appraisers

The real estate world is heavily regulated so the requirements are straightforward.  From time to time requirements may be changed by the AQB (Appraiser Qualification Board).  There are three levels of certification; licensed residential, certified residential and certified general.

To get started you need to become a trainee appraiser.  You will need to find someone to take you under their wing and show you the ropes so that you can get the hours needed to progress through the ranks.

[wpsm_colortable color=”blue”]

Trainee Appraiser CE Hours
Basic Principles & Procedures 60
15 Hour USPAP 15
Total Hours 75


As you can imagine if you want to progress through the ranks and appraise larger properties and commercial properties you will need to put in more class room time.  As a trainee you are expected to keep a log book of the properties that you appraise.

Time to move on to the next level:

Licensed Residential Real Property Appraiser

This will allow you to appraise residential units with values up to $1,000,000.

[wpsm_colortable color=”blue”]

Licensed Residential CE Hours
Trainee Requirements 75
Residential Market Analysis 15
Residential Site Valuation 15
Residential Sales Comparison & Income Approach 30
Residential Report Writing 15
Total Hours 150


In addition to the 150 hours of continuing education required to progress this far, one needs to also have 30 hours of college courses under their belt.  This roughly translates to about a year of college at 15 units per semester.  So if you have an associate’s degree or a bachelors degree you can cross this off your list.  As a trainee you also need to put in 2,000 hours of experience in the last year.  Which means that if you weren’t a full time trainee appraiser during the last year, you won’t be able to progress.

The final requirement needed to attain the licensed residential real property appraiser designation is to pass the AQB approved examination.

If you have attained a bachelor’s degree you can progress to the next level:

Certified Residential Appraiser designation

This gives the appraiser the ability to appraise residential units without regard to complexity or value.  They are also allowed to appraise vacant or unimproved land that may be used for residential units in the future.

To progress this far you will need the following CE courses.

[wpsm_colortable color=”blue”]

Certified Residential CE Hours
Trainee Requirements 75
Residential Market Analysis 15
Residential Site Valuation 15
Residential Sales Comparison & Income Approach 30
Residential Report Writing 15
Statistics, Modeling & Finance 15
Residential Case Studies 15
Appraisal Electives 20
Total Hours 200


You can see that you need to put in an additional 50 CE hours, and you need to be in the appraisal field for 2 years (minimum 2,500 hours).

With another six months of on the job training in the commercial appraisal field you can progress to:

Certified General Real Property Appraiser

It’s not much of a leap, an additional six months and 100 CE hours, but this step up on credential allows you to appraise all types of real property.  That’s right, you are now free to do all the things that you have learned, nobody is holding you back.  Just follow USPAP and do what you do best.

[wpsm_colortable color=”blue”]

Certified General CE Hours
Trainee Requirements 75
General Appraiser Market Analysis 30
Statistics, Modeling & Finance 15
General Appraiser Sales Comp Approach 30
General Appraiser Site Valuation and Cost Approach 30
General Appraiser Income Approach 60
General Appraiser Report Writing 30
Appraisal Electives 30
Total Hours 300


Something that I didn’t mention is a new rule for 2017; the background check rule:

  1. All applicants for a real property appraiser credential shall possess a background that would not call into question public trust.
  2. Applicants shall provide state appraiser regulatory agencies with all of the information and documentation necessary for the jurisdiction to determine the applicant’s fitness for licensure or certification.
  3. An applicant shall not be eligible for a real property appraiser credential if, during at least the five year period immediately preceding the date of the application for licensing or certification, the applicant has been convicted of, or pled guilty or nolo contendere to a crime that would call into question the applicant’s fitness for licensure
  4. Additional guidance related to background checks for applicants for a real property appraiser credential may be found in Guide Note 9 of  TAF_2017_appraiser guide

An appraiser has access to numerous properties.  It makes sense that the AQB has the ability to reject people with criminal records.  This helps to restrict this access to people who have been on the correct side of the law.