Distance of Comps

Discussion in 'Urgent - Help Needed' started by Alison Swain, Feb 28, 2006.

Thread Status:
Not open for further replies.
  1. Alison Swain

    Alison Swain Senior Member

    0
    Sep 13, 2005
    Professional Status:
    Certified Residential Appraiser
    State:
    Florida
    Comparable Distance from Subject

    Have I somehow missed a directive that all comparables must be within a one mile radius of the subject, regardless of subject's lot size, GLA, quality and additional features?

    I appraise in Central Florida where there are pockets of new, old, custom built, tract, tiny, humongous --- whatever --- all overlapping one another. I've got one particular lender who's underwriter is insistent that all comps must be within one mile of subject. In anticipation of this jerk, I wrote extensively in my most recent appraisal for them why it was necessary to extend my search area. The stipulations I got back (the only ones, by the way) sounded as if a) they never read the addendum, or b) they have no reading comprehension of what was explained.

    Obviously, if I can find truly comparable homes within one mile, those are what I'll use, but I was trained that the market area was the radius in which typical buyers would search for a home similar to the subject. The one mile rule is simply an arbitrary figure made up by underwriters who can't think outside the box.

    Am I all wet on this? :angry:
     
  2. Rudy Canoza

    Rudy Canoza Senior Member

    0
    Sep 27, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    California
    I usually quote Fannie Mae Guidelines in my addenda:

    Then I ask the undertaker to provide the comparable sales within 1-mile of the subject property that (s)he would like me to consider.

    /Thank you...please drive through...
     
  3. Craig Roberts

    Craig Roberts New Member

    0
    Jan 26, 2006
    Professional Status:
    Licensed Appraiser
    State:
    North Carolina
    Is your subject located in a rural area or a suburban area?
     
  4. Pamela Crowley (Florida)

    Pamela Crowley (Florida) Elite Member

    3
    Jan 13, 2002
    Professional Status:
    Retired Appraiser
    State:
    Florida
    The main thing to know and understand is that USPAP has nothing to say about the distance of the comps used.

    Fannie, etc., have 'guidelines'. Guidelines are not mandatory, but when exceeded, should include an explanation.

    It really doesn't matter whether it's Urban, Suburban, or Rural. The best comps are the best comps and no client can dictate to use sales that are not the best just because they want the appraisal to be within 'guidelines'. That would be demanding appraisers violate USPAP, and appraisers cannot legally do that no matter what the client wants.

    * USPAP come FIRST!!!
    * "Guidelines" can and are exceeded often, if they are Fannie's, Freddie's, VA's, FHA's, etc., then the appraiser only needs to explain why there were exceeded, but CANNOT let those guidelines get in the way of USPAP.
    * Any other client 'wants', if legal, can be considered, BUT CANNOT cause USPAP violations.

    If the client can't understand that, then the appraiser needs to decline the assignment. Appraisal clients CANNOT enforce any 'guidelines' that would cause a USPAP violation. Period.
     
  5. Alison Swain

    Alison Swain Senior Member

    0
    Sep 13, 2005
    Professional Status:
    Certified Residential Appraiser
    State:
    Florida
    Thanks, gang. All comments are very welcome and helpful.
     
  6. leelansford

    leelansford Elite Member

    15
    Mar 29, 2002
    Professional Status:
    Certified Residential Appraiser
    State:
    Illinois
    "Explain, explain, explain..."

    I have no idea as to whether or not what follows here applies to your specific situation...but...I find that the biggest problem that appraisers face in their communication of appraisals is their inability to properly communicate (in the appraisal report) the complexity of the assignment and the extent that the appraiser went to find appropriate substitute properties as sales comparisons.
    The result: The client is left wondering exactly why the comps are as they are.
     
    Last edited: Mar 1, 2006
  7. Tim Hicks (Texas)

    Tim Hicks (Texas) Elite Member

    5
    Jan 15, 2002
    Professional Status:
    Certified Residential Appraiser
    State:
    Texas
    There is nothing wrong with this as long as you are not avoiding sales in the neighborhood to a achieve a value. Make absolutely sure that there are not more similar sales closer to the subject property. A subject's neighborhood is its neighborhood and should be considered a factor.
     
  8. Fred

    Fred Elite Member

    0
    Jan 15, 2002
    Professional Status:
    Retired Appraiser
    State:
    Virgin Islands
    Pam,
    It’s Uspap comes in first and maybe the guidelines don’t come in at all – if Fannie is not identified as an intended user.
     
  9. Timothy Wixted

    Timothy Wixted Junior Member

    0
    Aug 10, 2004
    Professional Status:
    Certified Residential Appraiser
    State:
    Florida
    Alison,

    You could give them what they want. Just state prominately that the additional sales cited are not truly comparable, supplied only at the request of the underwriter and ZERO weight is placed on them.

    You could also charge them $100 per extra comp, payable in advance.

    Tim
     
  10. David Wimpelberg

    David Wimpelberg Moderator Staff Member Moderator

    18
    Mar 30, 2005
    Professional Status:
    Certified General Appraiser
    State:
    New York
    Wouldn't it be a reasonable assumption that anything done on a Fannie form has Fannie as an intended user?
     
Thread Status:
Not open for further replies.

Share This Page