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Discussion in 'Illinois' started by Brian Weaver, Aug 14, 2011.

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  1. Brian Weaver

    Brian Weaver Senior Member

    4
    Apr 16, 2005
    Professional Status:
    Gvmt Agency, FNMA, HUD, VA etc.
    State:
    Illinois
    I'm receiving calls and e-mails regarding AMCs and lenders asking Illinois appraisers to comment on home inspections done by others. If you do NOT hold an Illinois Home Inspection license, you will be charged with unlicensed practice. What follows is from the Illinois Home Inspection website:

    A Home Inspection is an examination of the exterior and interior components of residential real property. This includes the examination of at least 2 of the following:
    Heating, ventilation, and air conditioning system;
    Plumbing system;
    Electrical system;
    Structural composition;
    Foundation;
    Roof;
    Masonry structure; or
    Any other residential real property component as established by rule.
    It is illegal for a person, including an entity, to act, engage, develop, practice or advertise as a home inspector without a proper home inspector license issued under the Illinois Home Inspector License Act. A person who violates this is guilty of a Class A misdemeanor.
     
  2. Denis DeSaix

    Denis DeSaix Elite Member

    186
    May 16, 2005
    Professional Status:
    Certified General Appraiser
    State:
    California
    What kind of comments are the AMCs/Lenders requesting?

    I can understand why an appraiser does not want to act as a home inspector (I certainly do not). But what if the comment is regarding a condition that is consistent with appraising? An FHA appraisal requires the appraiser (under certain circumstances, but it is more likely than not) to test heating, air conditioning and ventilation equipment, no?

    What if the home inspector says the furnace doesn't work and the appraiser checked it and it does work and the lender wants the appraiser to comment?
     
  3. Brian Weaver

    Brian Weaver Senior Member

    4
    Apr 16, 2005
    Professional Status:
    Gvmt Agency, FNMA, HUD, VA etc.
    State:
    Illinois
    Then they need a home inspection license, here. This law has been on the books in Illinois for years. It isn't new.
     
  4. Caligirl

    Caligirl Senior Member

    0
    Jan 27, 2006
    Professional Status:
    Certified General Appraiser
    State:
    California
    Respectfully, I'm with Denis-appraisers are required to comment on all of those items on the checklist for 'home inspector' during their *appraisal* inspection. Is there some add'l wording missing from your OP? Perhaps the definition of 'examination' is what is different?
     
  5. Lloyd Bonafide

    Lloyd Bonafide Senior Member

    0
    Jan 15, 2006
    Professional Status:
    Certified Residential Appraiser
    State:
    California
    It seems like there should be a big distinction between commenting on a home inspection, vs. performing an inspection. :eek:
     
  6. Brian Weaver

    Brian Weaver Senior Member

    4
    Apr 16, 2005
    Professional Status:
    Gvmt Agency, FNMA, HUD, VA etc.
    State:
    Illinois
    Is that like the difference between commenting on an appraisal and performing a review? I'm just telling Illinois appraisers what the law says. I didn't write it. Don't shoot the messenger.
     
  7. Denis DeSaix

    Denis DeSaix Elite Member

    186
    May 16, 2005
    Professional Status:
    Certified General Appraiser
    State:
    California
    I'm not shooting the messenger! :laugh:

    But I can empathize with the regulator, the appraiser and the client.

    As the law is written, it might be argued that completing an FHA appraisal is also completing a home inspection.
    Certainly, that was not its intent, and I cannot see anyone interpreting the law this way for enforcement purposes.
    Likewise, if an FHA appraisal is deficient because the appraiser failed to test the systems, and the DEU directed the appraiser to do so, I doubt if the home inspection regulation would be interpreted that the appraiser cannot comply.

    But that's where it gets from "common sense" to "very gray". Change FHA to conventional, and a client asks an appraiser to comment on a component that most of us would agree could affect value and that the appraiser is qualified to comment on (like, did the AC work when you were there?) and it sounds like there could be an enforcement issue.
    There is no real difference between the FHA requirement and a client's request (especially if it is a condition of the assignment). Therefore, using a rule of fair enforcement (everyone gets treated the same), why would an AMC/Client's request get treated any different from the DEU?

    Not arguing with you Brian, and I'm obviously not an Illinois appraiser. But it just seems that a regulation like that cannot be enforced fairly or consistently without shutting down a lot of legitimate appraisal activity (that really doesn't conflict/compete with the home inspector's responsibility or harms the general public, which is what I would presume to be the regulation's ultimate objective). :shrug:
     
  8. William K

    William K Senior Member

    0
    Sep 21, 2007
    Professional Status:
    Certified Residential Appraiser
    State:
    Illinois
    I believe there is a valid distinction between what is required as part of "appraisal practice" and the commenting on the inspections performed by other qualified licensed individuals.

    "Roofing report states roof is at the end of its physical life"
    AMC- Do you believe roof requires replacement?
    Appraiser- It is beyond the appraiser's expertise, the Roofing report indicates the roof is at the end of it's life expectancy.

    There are reasons why HUD does allow for the appraiser to call for an inspection when it is out of the appraisers realm of expertise.

    Home inspections should be no different than an EPA Environmental Audit or an Engineering Report.
    My comment to an AMC would be, "you have it from the expert". When the Home Inspector provides commentary on the Value of the property then I will comment but when the comment is within their expertise "It is, What it is"
     
  9. PL1957

    PL1957 Senior Member

    17
    Jul 19, 2004
    Professional Status:
    Certified General Appraiser
    State:
    Illinois
    I've always wondered what kind of discipline someone can be subject to if they don't acknowledge the disciplinary authority. What discipline can the Appraisal Board impose on an accountant who does real estate appraisals?
     
  10. Brian Weaver

    Brian Weaver Senior Member

    4
    Apr 16, 2005
    Professional Status:
    Gvmt Agency, FNMA, HUD, VA etc.
    State:
    Illinois
    Unlicensed practice. A cease and desist with or without a fine.
     
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