There are occasions when my bank has to outsource reviews of commercial real estate appraisals. Can we establish a set fee for this cost and then refund the money if we do the review in house? Can this fee be established as a percentage of the loan fee or would it have to be a set fee? Typically we bid out for the appraisal and then ask for the funds prior to actual engagement of the appraisal. But in the case of the review, we don't know until the appraisal is submitted if we'll need to send it out for review. How do other banks handle this situation?

We accept appraisals from appraisers we have done business with before, and who have provided us with acceptable evaluations. For new appraisers, or if there are some questions that are not resolved by/with the current appraiser, we pay for the additional review ourselves.

Anon. Please don't double post. Double posting is a waste of your time and everyone else's.

This is in the Lending forum (where it was answered twice) as well.

All commercial appraisals over $1 million are reviewed independently of the bank. We have a small group of approved review appraisers. We have been gradually adding the review cost to the appraisal fee where competition where allow the additional expense to the borrower. But for the most part, the review expense is a cost of doing business to the bank. Review fees vary dependent upon the complexity of the property. I don't think you could charge a percent or use some other formula. But since these are commercial appraisals and loans, you can charge anything you want. There are no consumer regs to worry about in that regard.