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Clarification needed ASAP:USPAP & Sales Contracts

Discussion in 'Fannie Mae, Freddie Mac, USPAP' started by appraisalaska, Sep 14, 2009.

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  1. appraisalaska

    appraisalaska Sophomore Member

    0
    Nov 29, 2007
    Professional Status:
    Certified Residential Appraiser
    State:
    Alaska
    Its my understanding that an appraised value cannot be changed even after receiving an addendum to a sales contract which increases the value...even if the increased value falls within the original high/low end of the adjusted value range.

    Its also my understanding that any change in value without new updates to the subject property or comparable analysis would reflect a predetermined value, which would then be a violation of USPAP.

    Any thoughts on this one way or another? ​
     
  2. TimberRidge

    TimberRidge Sophomore Member

    0
    Aug 28, 2008
    Professional Status:
    Certified Residential Appraiser
    State:
    Ohio
    Um, a sales contract (or changes to one) should have absolutely nothing to do with the final estimate of value.

    Prepare to be flamed ;)
     
  3. Mike Kennedy

    Mike Kennedy Elite Member

    38
    Sep 28, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    New York
    Last edited: Sep 14, 2009
  4. George Hatch

    George Hatch Elite Member

    48
    Jan 15, 2002
    Professional Status:
    Certified General Appraiser
    State:
    California
    Your opinion as of the effective date is your opinion. The contract price as of the effective date of your assignment is a fact. You can't unbreak an egg.

    That fact can be considered as a single datapoint but in no case would you allow any single datapoint to outweigh an otherwise identifiable trend. Even if that datapoint is a sales contract.

    If you learned something about the subject (other than the price) or the comparables that was relevant to your opinion of value then you might have reason to change your opinion. Merely changing a contract price would only be a significant factor in your appraisal if you were arbitrarily equating that contract price to market value.
     
  5. Farm Gal

    Farm Gal Elite Member

    0
    Jan 14, 2002
    Professional Status:
    Licensed Appraiser
    State:
    Nebraska
    Unless the new contract materially changes the subject property and makes it subject to some conditions not present at the time of the original contract... or discloses some defect or matter of fact not previously 'known' about the property physical situation...

    Pray tell how would the value of a property be modified by seller and buyer changin their minds about what each of THEM thought it was worth in price?

    Hint- Analysis of financing terms may assist you in disclosing the change in contract - who failed to qualify and by how much? OR what are they 'fixing' that is non-real in nature?
     
  6. Restrain

    Restrain Elite Member

    7
    Jan 22, 2002
    Professional Status:
    Certified General Appraiser
    State:
    Florida
    Just put in an addenda that subsequent to the submission of the report, a contract was received changing the sales price from X to Y. The appraiser has reviewed the revised contract.....
     
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