When is a desktop equipment appraisal the right option?

An inspected appraisal, one where the equipment appraiser completes a visual inspection of the assets, can frequently be a better option for many equipment valuations. There are times though, when a desktop appraisal may be appropriate for your needs. A desktop appraisal may be the right solution for scenarios like: - The equipment is not available to be inspected. For example, if the assets were donated and we are completing a charitable contributions appraisal, the assets might not be available for inspection. When we complete insurance appraisal, the assets may have been stolen or destroyed, so an inspection isn’t an option. - The assets to be valued are at multiple locations across a large area or where the assets are so remote that travel would be cost-prohibitive. Sometimes, a hybrid approach, inspecting some assets, and completing an uninspected desktop appraisal on others, is the best procedure. - The equipment is common or standardized and does not have significant customizations.

Desktop Equipment Appraisal FAQ

APPRAISAL 101 TOPICS

A desktop appraisal, also called a desk appraisal or an uninspected appraisal, is completed without a site inspection and relies on provided information about the subject assets.

An inspected appraisal, one where the equipment appraiser completes a visual inspection of the assets, can frequently be a better option for many equipment valuations. There are times though, when a desktop appraisal may be appropriate for your needs.

A desktop appraisal may be the right solution for scenarios like:

The equipment is not available to be inspected. For example, if the assets were donated and we are completing a charitable contributions appraisal, the assets might not be available for inspection. When we complete insurance appraisal, the assets may have been stolen or destroyed, so an inspection isn’t an option.
The assets to be valued are at multiple locations across a large area or where the assets are so remote that travel would be cost-prohibitive. Sometimes, a hybrid approach, inspecting some assets, and completing an uninspected desktop appraisal on others, is the best procedure.
The equipment is common or standardized and does not have significant customizations.

What information do you need to complete a desktop equipment appraisal?

Sencer Appraisal’s equipment appraisers follow USPAP (Uniform Standards of Professional Appraisal Practice), the standards for appraisal professionals in the United States. These guidelines require our appraisals to “produce credible assignment results,” so we must make sure there is enough detail on the equipment to develop our opinion of value.

Basic information might include:

Make
Model
Serial number / VIN
Age
Hours / mileage
Specifications, such as size, capacity, horsepower
Condition

It is also important that the information is provided in an organized manner. A well organized Microsoft Excel file is one option. If we are only provided with photos of all the assets, the appraiser may need just as long or longer to review all the photos than it would have taken to just complete a site inspection and visually inspect all the assets. A well-organized list of assets and clear photographs is a good start, but we usually need to be able to talk with someone knowledgeable about the equipment to clarify information or for additional equipment details.

Is a desktop appraisal cheaper than an inspected appraisal?

When clients ask us for a desktop appraisal, they may assume that since it doesn’t include a site visit, it will be quicker and cheaper. While that is sometimes the case, it isn’t always. It really depends on how thorough and organized you are in providing the information needed for the appraisal.

In a desktop appraisal, the equipment owner or another party is collecting the data instead of paying the equipment appraiser to collect the information. If the equipment details are provided in an organized fashion, the desktop appraisal may be cheaper since you are not paying for the equipment appraiser’s travel time, the time for a site inspection, or the time to then organize that information. To find out what we need to complete a desktop appraisal for you, fill out our online form or call us at 888-473-6237.

How long does a desktop appraisal take to complete?

There is no set rule on how long it takes for a desktop appraisal. Our equipment appraisers still need to make sure we have enough information on the assets to complete the appraisal, and we still need to complete the same level of research and analysis.

A desktop appraisal, when full information has been provided to us, may be a little faster than an inspected appraisal since we don’t need to allow time for the inspection. To find out if your valuation is appropriate for a desktop appraisal contact us online or give us a call at 888-473-6237.

Is a desktop appraisal acceptable for litigation or divorce?

We usually do not recommend a desktop appraisal for legal proceedings or disputes that may involve litigation if there is a way for an inspection to be completed. We have found that in a deposition or court testimony, the very first question we are asked is if we have personally inspected the assets.

We are frequently hired to be the joint expert in litigation, serving as the court-designated expert appraiser for both sides of the dispute. In that type of amicable legal situation, a desktop appraisal may be more appropriate.

If you are considering a desktop appraisal for use in litigation, give us a call at 888-473-6237 or contact us online to discuss your needs and how we can best help you.

Can a bank or other lender use a desktop appraisal for an asset-based loan?

The short answer is “it depends.” Some lenders have set policies against desktop appraisals, and some allow the loan officer to make the decision on whether a desktop appraisal is acceptable. For some banks, the decision may depend on whether it is a Small Business Administration (SBA) loan.

If you are representing the lending institution, you have to consider the possibilities for fraud. Sencer Appraisal has completed a number of site inspections and discovered that the borrower provided lists of equipment to use as collateral, where the lists included assets that did not actually exist, were not in the condition they claimed or had been sold months or years previously. (One borrower even gave his bank old pictures of sold equipment and “forgot” to mention that he didn’t own the assets anymore.) If a bank officer has seen the equipment, or the lending institution has a long-time customer with an established relationship, then it might have enough trust to rely on an appraisal without an inspection.

If you need an equipment appraisal for an asset-based loan and want to know if a desktop appraisal will be a good fit, fill out our contact form or call us at 888-473-6237.