Unbiased Fair Market Value in Face of Pressure

Recently, I had a client going through a divorce that insisted on repeatedly requesting that I provide the absolute lowest Fair Market Value (FMV) in order to minimize the impact on his finances of the pending division of property.

There are several ways for an appraiser to approach such situations, from directly explaining to him or her the importance to appraisers of providing an unbiased product, to stating that you (the appraiser) will provide the "most appropriate" FMV, to simply ignoring the issue.

All clients are different and each will likely benefit from a different technique, but I invite you to share your best experiences in such situations.

Dentist's Practice Appraisal Wants vs. Needs

The two conflicting challenges of doing a dental office appraisal are 1) establishing a "Fair Market Value" and 2) providing the client with a satisfactory sale price.

Generally, a dental practice appraiser is supposed to provide a Fair Market Value, which is, by definition, one that is just and reasonable for all parties involved.

However, each party comes with their own wants and needs with regards to the establishment of a practice value (usually a purchase price). And it is generally the Practice Owner who contracts with and pays the appraiser.

Usually...

• The current owner wants a high value.
• The potential owner wants a low value.
• The divorcing owner wants a low value.
• The estate of the deceased dentist wants a high value.
• The associate wanting to partner in the future wants a low value.

It is, of course, the appraiser's responsibility to understand the various forces pulling him or her in opposing directions, while trying to maintain an independent point of view.

I'd be interested in any comments or experiences sellers or buyers of dental practices have had in regards to whether the Fair Market Value from their appraiser seemed fair or biased.

Best wishes for a happy and safe holiday season!

Todd Christensen

Success@AssistToPractice.com

Dental Practice Appraiser

Personal Budget Busters

In addition to my practice appraisal services, I am a Certificate Personal Finance Counselor® and a financial educator. For many people, hearing the term, "Personal Finance," is tantamount to covering their face with a rag doused in ether. Zzzzzz.

With that acknowledgement, one of my favorite personal finance sub-topics - and one that most participants in my classes actually find interesting and enlightening - is a "Budget Busters" table. It lists several of the little expenses that creep into our day-to-day finances, along with the big sums they add up to on a monthly and yearly basis. I've heard it called "the latté factor" elsewhere.

Here's the link:

http://www.nationalfinancialeducationcenter.org/docs/Budget_Busters_Brochure.pdf

Check it out and see if you have any of your own Busters listed. We've all got something we can work on. It's not necessarily about eliminating them, but rather minimizing their impact and placing them in their proper place among our financial priorities.

Finally, believe it or not, with Halloween over, it's now officially the Holiday season. So with that, I'll end by saying,

Happy Holidays!