Ordering an Equipment Appraisal for a Loan: 3 Things to Check
The three things credit officers and lenders should verify on any machinery and equipment collateral appraisal: the premise of value matches the loan, the equipment was inspected and serial numbers verified on site, and the appraiser is independent of the deal.
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Transcript
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Before the equipment appraisal goes in the credit file, three things are worth checking.
One. The premise of value matches the loan. Fair market value in continued use, orderly liquidation, and forced liquidation answer different credit questions. The report should state which one, and why.
Two. Someone actually saw the equipment. Serial numbers verified on site, condition observed, not copied from a depreciation schedule.
Three. The appraiser is independent of the deal. No stake in the sale, no pressure on the number. That is what makes the file defensible in review.
Lukes and Lukes performs machinery and equipment appraisals for lenders nationwide. Independent inspection, USPAP compliant reporting, values that survive credit review. lukesappraisals.com.
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Send the asset list and the reason for the appraisal. We confirm the premise and scope before any work begins, and we never quote a value before inspection.