The 3-day appraisal rule isn’t a formal law but rather a guideline used in some real estate or mortgage contexts. It generally refers to the idea that an appraisal report is considered most valid if it’s no more than three days old when used for a transaction, especially for fast-moving markets or when the lender wants a current snapshot of property value.
Key points:
- Purpose: Ensures the appraisal reflects the current market conditions, which can change quickly.
- Common in: Mortgage underwriting, short-term financing, or competitive real estate deals.
- Practical use: Lenders may require a “fresh” appraisal if the original one is older than three days.
It’s not universal—some lenders may accept older appraisals, others may request updates or a new report.
Related
Residential Appraisal in Real Estate: Unveiling the Valuation Process
Which is higher assessed value or appraisal
Here’s a simple table comparing the 3-day appraisal guideline for residential vs commercial properties:
| Feature | Residential Property | Commercial Property |
|---|---|---|
| Purpose of 3-day rule | Ensures appraisal reflects current market conditions for a mortgage or quick sale | Ensures valuation reflects market trends, tenant income, and lease conditions |
| Market sensitivity | High — small changes in demand or comps can affect value | Moderate — value depends on income, occupancy, and long-term leases |
| Lender requirement | Often enforced in fast-moving markets; some may allow older appraisals | Less strict; appraisals may remain valid longer, but lenders may request updates if market changes rapidly |
| Practical impact | Buyer or lender may need a new appraisal if older than 3 days | Commercial deals usually allow more flexibility, but short-term financing may still demand a recent appraisal |
| Update frequency | Appraisal may need to be refreshed if offer accepted after 3 days | Updates are less frequent unless significant market or property changes occur |
This shows why the “3-day rule” is more critical for residential properties than commercial ones.