Claudia Gaglione National Claims Counsel

Claudia received her Juris Doctorate from the University of Southern California Law Center in 1982 and specializes in the defense of professional malpractice claims. Since 1987, Claudia has personally supervised over 8,500+ claims and lawsuits filed against real estate appraisers across the country. By virtue of this experience, she is uniquely qualified to speak about what kinds of things appraisers get sued for and what defenses are most successful. More importantly, Claudia can discuss the types of errors that are avoidable and how appraisers can make themselves the best possible defendants in the event they are ever sued.

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State Board Complaint Frustrations

Q: "A first-time homebuyer recently filed a complaint against me with the state licensing board, alleging that I failed to conduct a “thorough” inspection of her attic. According to her, had I fulfilled my responsibilities, I would have detected roof leaks, allowing her to address the issue with the sellers prior to close of escrow. Consequently, she is now stuck with the repair expenses, and she's blaming the entire problem on me.

It's worth noting that she opted not to get a home inspection, as she believed her real estate agent's assertion that the FHA appraisal is “just as good”. However, the agent has clarified to me that she did not say that. The buyer justified forgoing an inspection by claiming her father, a handyman, could fix anything. My question is why do the State Boards deal with this kind of thing? This is not a USPAP violation?

The investigator has tasked me with answering a set of questions, submitting my report and work file, and has given me a tight deadline of 10 days. But she also warned me against expecting a prompt response, suggesting it could take as long as 6 months to a year.

Do you see this sort of thing often?"

A: Yes, we see this “sort of thing” several times each month. Any time you receive a complaint filed against you with the licensing board, it can be incredibly frustrating. Preparing a response can be time-consuming, but unfortunately, you have no choice but to do so. Taking out your anger on the investigator is not in your best interest.

Remember, investigators don’t create the rules; they simply follow them, just as you must. While there may be matters they’d prefer to skip over, the boards have no leeway. They are obligated to open a file and investigate any issue brought to their attention.

Ideally, more states would implement a screening process to filter out certain complaints and reduce backlogs. Unfortunately, that’s not the current reality. Your best course of action is to adhere to the rules and maintain patience. Hopefully, this situation will be resolved soon.

Articles from Claudia


  • Intended Use Not Clear

    A local attorney that I have worked for in the past called and asked if I could appraise a small commercial property for a client. When I asked why they need [...]

  • Can’t Certify the Work

    Due to COVID and Supply Chain issues there have been many delays getting building materials to sites. When completing construction progress reports, I am repeatedly being asked to [...]

  • Deposition Fears

    I recently had my deposition taken and it was horrible experience. Even though I had my attorney sitting nearby, the process was nerve-wracking [...]

  • A Family Feud and Intended Use

    I was recently hired by a local attorney to appraise a small industrial building. The intended use was supposed to be for estate tax purposes. The attorney said this building is the only real property owned by the descendent and that there are two beneficiaries [...]

  • A New Assignment, not a Simple Revision

    I completed an appraisal coming up on 6 months ago. A local bank was the client and the stated intended use was for purchase money financing. The loan rep recently contacted me and asked me to send a ‘revised’ report naming the [...]

  • Weather Impact

    I appraised the subject property a few weeks ago in connection with a purchase loan. Over this past weekend, there was some major rainfall and flooding in [...]

  • Completion Certificate Assignment

    A client called and asked me do him a big favor by certifying a repair. The original appraiser had called for a window repair in his report and the client said that the repair work was done, but the original appraiser has COVID and couldn’t check. [...]

  • Record Keeping…Forever?

    This is just a general question about record keeping. I know I have to keep my files for 5 years to be USPAP compliant but a buddy of mine just got sued for [...]

  • The Importance Of A Work File

    As a defense attorney, I consistently deal with professionals. One day we might be dealing with a claim that has been made, while the next day we may be discussing steps that can be taken to avoid a claim.[...]



  • What is a Claim?

    Back to the basics for real estate appraisers. A "claim" generally means a demand against you (the insured) seeking damages arising out of a wrongful act by you in the rendering of professional services which[...]










  • USPAP Violations

    A few months ago I got a complaint from the state licensing board. The complaint was made by a seller who claimed the appraisal I prepared for the prospective buyer’s lender had understated value. The seller was [...]


  • Hybrid Appraisal Language

    Our office has been approached by a client about preparing “Hybrid” appraisals, so I asked to review a sample form from them. It looks pretty typical of others I have seen; I have to provide [...]




  • Can’t Ignore a Subpoena

    I completed an appraisal and report for a refinance loan 2 years ago. I was not contacted about it by any party after I uploaded it to the client. But now I [...]


  • The Blame Game

    While filling out my insurance renewal application, I came across a question that asks if in the past 10 years [...]


  • Roof Concerns

    I prepared a residential appraisal about 2 weeks ago. This was for a refinance loan. While I was inspecting the house the property owner [...]



  • Expert Witness

    I have been doing expert witness work in this town for years. Lately a couple of other appraisers have been “marketing” themselves as experts after they took some class called “How to be an Expert”. So now [...]


  • "Off the cuff" opinions

    I have done work for a local attorney many times over the past few years. This attorney seems to be a general practitioner I suppose you could say. [...]


  • The Pitfalls of Small Chit-Chat

    I inspected a property as part of a refinance assignment. I gave the borrower my business card, as I always do at an inspection. The borrower was not watching me like a hawk, but he was kind of hovering around [...]


  • Shopping for value

    I got a call today from a woman who had been referred to me by a mutual friend. She wanted to hire me to prepare an appraisal of her home. Of course, I asked why she needed [...]


  • Effective disclaimer language

    I was at a CE class the other day and one of the appraisers there was talking about a lawsuit he was in. This guy did the appraisal 8 years ago, when the people who are suing him bought the house. [...]


  • Am I on shaky ground?

    In a recent report I required a structural inspection. The home is over 100 years old. It has a raised foundation, wood subflooring, wood floor joisting [...]



  • Duty to cooperate

    I was sued last year and my insurance company is defending me. The lawsuit involves 1 appraisal I did in 2007. The borrowers who are suing me say that I conspired with the bank to inflate values and they asked me to give them copies of every appraisal I ever did for this bank. [...]


  • Steer Clear

    In 2015, a local attorney hired me to appraise a 6 unit apartment building. The property was owned by a partnership made up of 3 men, let's call them A, B, and C. My client said [...]




  • Roads unknown

    I just got a call from a lender/client about a new assignment and I am not sure what to do. The client says this is not an appraisal, but [...]


  • The Fine Print

    One of our lender clients has forwarded a new form that they want us to sign and submit with our commercial appraisals. Overall, I don't see anything that causes me too much concern but the one section [...]


  • FNMA repurchase demand

    I did an appraisal 4 years ago for one of my clients. They never questioned me about that report. Today I found out that client sold the loan to FNMA and now they want me to help them. It seems that FNMA has a negative review of my appraisal [...]


  • Approved list removal

    I did an appraisal for a lender in 2013. A few months ago they wrote to me saying they had a negative review of my report. They asked me to look over the review and to send them my comments. The review they sent me was [...]


  • Code violations and expertise

    Last year I did a "subject to completion" appraisal of a new home being built nearby. The appraisal was based on the plans they gave me at the time. There has been some press around here lately about problems with the local building department. [...]


  • Appraisal Update Obligation?

    I appraised a single family residence for a good lender client about a year and a half ago. Today I got a call from another lender wanting an "update". I explained to this guy who called today that I could not do an "update" but, [...]



  • Client Confidentiality?

    A borrower / homeowner called and stated that they got my cell phone number from the lender. I figured that I can now discuss the appraisal with the borrower. Was I correct in assuming that? [...]


  • A case of forgery

    I just got a very disturbing call from a lender. They wanted to ask me a question about how I arrived at the square footage in a report I did about 2 years ago. When he gave me the address of the property, [...]



  • Changing an appraisal

    I just got a call from an angry homeowner.  I did a refi appraisal a few weeks ago and my value was $137,000, based on 1100 square feet.  This lady said she bought the home 2 years ago for $178,000. [...]


  • Compensation for a subpoena

    I was recently served with a subpoena to show up at a trial with my appraisal work file. I called the attorney who sent it and it turns out this lawsuit has nothing to do with me, but this guy insists that I have to be [...]



  • Unpaid Invoice

    A lender client has not paid my bills for a report I did a year ago. They say the value was no good. They were supposed to pay me $10,000 in 4 installments of $2,500. They paid me $5,000 but still owe me the rest. [...]


  • Lender do not use list

    I got a letter the other day from a lender saying because of some bad review of one of my appraisals, I am now on their "DO NOT USE" list. Will the insurance company sue to get me back on the list? [...]


  • Request for a cost to repair

    I recently appraised a bank owned home for this AMC. I was provided with a 40 page home inspection report that listed a variety of problems ranging from structural issues to termites to roof problems to mold. [...]


  • Responsible party in a lawsuit

    I had a lawsuit filed against my company a year ago. Now the attorney hired by the insurance company says it should be settled because there are some problems with the appraisal, which I know he is right. [...]


  • A subpoena and a destroyed workfile

    I was served with a subpoena to testify at a deposition and I am also supposed to bring my appraisal and work file with me. My only problem is that the appraisal in question was done in 2000 and I have already destroyed my file. [...]


  • What is an actual claim?

    I am filling out my renewal application for E&O insurance and have a question. I just remembered that someone called me a few months ago to complain that I had made a mistake on an appraisal I did some years back. I did not [...]


  • When is it time to call my E&O provider?

    I was talking to another appraiser recently at a USPAP class. He said he calls his E&O Company every time someone calls to ask him a question. He said if we don't do this then the insurance company can cancel [...]


  • Wildfires

    About 2 weeks ago I appraised a home in California.  This property was in an area affected by the recent wildfires.  Today, the lender called and said that they wanted me to go out, ASAP, drive by the property [...]


  • Angry borrower wants money back

    I just got off the phone with the borrower on a property I appraised a month or so ago. This guy was looking for a refinance loan and was really upset that my value did not come in higher than what he paid for the property [...]