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Lo Wants Foreclosed House As "average"

Discussion in 'General Appraisal Discussion' started by Pat Butler, Dec 5, 2003.

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  1. Pat Butler

    Pat Butler Senior Member

    6
    Jan 17, 2002
    Professional Status:
    Certified Residential Appraiser
    State:
    Illinois
    Completed an appraisal yesterday of a banked owned property. It needed all new floorcoverings, painting, new furnace & water heater, and the kitchen only had two wall cabinets and the base cabinets were moldy and broken. The bathroom had cracked fixtures and tiles. Basically then, it needed a new kitchen and bathroom.

    The loan officer knew this was a bank owned property. I assumed that he was going to place the loan with a company that accepted this type of property. He calls today and is upset because he thinks the subject could be deemed in Average condition. I had supplied 20 photos in the report. I just can't believe some people.
     
  2. Randy Beigh

    Randy Beigh Senior Member

    0
    Jan 16, 2002
    Seems to be a rash of this type of requests.

    Just in the past 2 days, I have had a request to take a suburban property and make it rural because the comps were to far away for their guidelines. Another one wants us to remove GLA if the additon doesn't have a building permit. They even want us to turn the second floor into an attic. The house was built in 1901 and it's not likely there was a building permit process. They want us shrink the house.

    These 2 requests are opposites of what we would normally get when they would want us to take a rural property and make it suburban or include areas that we didn't think should be.

    It's getting weird out there.
     
  3. Scott Kibler

    Scott Kibler Elite Member

    16
    Oct 7, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    Illinois
    Too many newbie loan originators out there that can't figure out how to price and place their deals. Realors too. I had a bank owned last month that had significant water damage including mold. Plainly disclosed on the MLS listing. Buyer's agent had a fit that I prominently disclosed it in the report with a number of other cost to cure items. She said she never heard of "cost to cure" in an appraisal for a purchase. Turns out they were trying to get 95% financing on the place to a first time home buyer. Nice.
     
  4. Oregon Doug

    Oregon Doug Senior Member

    0
    Jan 15, 2002
    Professional Status:
    General Public
    State:
    Oregon
    As REOs become more common, I think you'll see more & more of this sort of thing. I believe that if they can't get you to lie about the value, then they will try to get you to lie about the condition.

    We all know that every REO home has received excellent maintenance and care over the years and is in fine condition - after all, it hasn't been lived for several months (except by a few transients who likely built a campfire in the living room): so how could it possibly be in "rough" condition?

    Seen 'em,
    Oregon Doug
     
  5. Dan Leggett

    Dan Leggett Senior Member

    0
    Jan 15, 2002
    Professional Status:
    Certified General Appraiser
    State:
    Mississippi
    That might just tell you what kind of house the loan officer lives in.

    I listen to WLS radio alot. Is your deal one of Landmark Financial's "Big Shooter Alert" of the "Jumbo Special"?
     
  6. CANative

    CANative Elite Member

    62
    Jun 18, 2003
    Professional Status:
    Certified Residential Appraiser
    State:
    California
    I got the same thing a few days ago. I wrote an addendum with a collection of comments I found here at appraisersforum, explaining that mileage in and of itself does not define rural/suburban/urban.

    Same appraisal came back this morning. (This area has few comps and when you find 3 good ones its like gold) The 3 comps I used (the ONLY ones reasonably similar) all sold for slightly more than my adjusted value. They want 2 additional comps that sold for the same as my adjusted value or ("preferably") less.

    I think I have now enterered "The Appraisal Zone."
     
  7. Mike Garrett RAA

    Mike Garrett RAA Elite Member

    9
    Jan 14, 2002
    Professional Status:
    Certified Residential Appraiser
    State:
    Colorado
    Just tell the loan office ... " yeah, and I wish I was taller...but I am not and that property isn't in average condition. Case closed!".
     
  8. Ghost Rider

    Ghost Rider Senior Member

    0
    Apr 27, 2003
    Professional Status:
    Banking/Mortgage Industry
    State:
    Connecticut
    I'll take a slightly different tact - I never really tried to give the LOs and UWs crap on things like that......Here is what I would do!!!

    First, let them know in order to do that, there will be an additional fee of (Insert whatever you want here - it's a nuscience fee) and that it needs to be paid in advance BEFORE you lift a finger - then, call the subject "Average" and make the report "subject to" whatever needs to be done to bring the subject up to a condition you would consider "Avergage".......When they squeal about, explain to them the same the UW that you were ONLY DOING WHAT THEY ASKED FOR.....They learn their lesson QUICKLY.......
     
  9. Pamela Crowley (Florida)

    Pamela Crowley (Florida) Elite Member

    3
    Jan 13, 2002
    Professional Status:
    Retired Appraiser
    State:
    Florida
    Good one Merriman! The perfect alternative.
     
  10. Ghost Rider

    Ghost Rider Senior Member

    0
    Apr 27, 2003
    Professional Status:
    Banking/Mortgage Industry
    State:
    Connecticut
    Just giving them what they ask for, ya know??

    I'm not usually one for trying to re-educate the UWs and LOs......It feels too much like I'm banging my head against a brick wall when I do it. I just give them what they ask for, if they don't like it, they still have the other appraisal in "Fair" condition.....
     
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