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Uspap

Discussion in 'Fannie Mae, Freddie Mac, USPAP' started by New Century, Oct 18, 2007.

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  1. New Century

    New Century New Member

    0
    Jul 10, 2007
    Professional Status:
    Certified Residential Appraiser
    State:
    Washington
    I know, I know, New Century. I have been in buisness longer than the New Century Mortgage and now look where there at.

    My question is, I have been asked a couple of time now in the last week to due an appraisal withan AS-IS Value with also a SUBJECT-TO value on the same 1004 form.

    It seems to me that this is two different assignments and two different scope's of work. You would need new sales for the SUBJECT-TO value.

    Is this allowed by USPAP and where do you find it in the USPAP book.
     
  2. Tom Woolford

    Tom Woolford Elite Member

    50
    Nov 20, 2005
    Professional Status:
    Certified Residential Appraiser
    State:
    Florida
    USPAP does not dictate the form used for the report. You don't even have to prepare a report to be USPAP compliant.
     
  3. Farm Gal

    Farm Gal Elite Member

    0
    Jan 14, 2002
    Professional Status:
    Licensed Appraiser
    State:
    Nebraska
    sigh... its a form. The Fannie form in itself has only has ONE place to report a value- which value is subject to the mostly pre-printed Certs and Limiting Conditions AND to the Fannie Freddy regs under which you developed the report for the specific cleint and use. SOW dearie! and they mostly wrote the SOW because the fannie form is intended for use for mortgage lending oNLy and under specified conditions!

    You can report a second value with a clearly defined NARRATIVE as to the scope of work ofr the second value and how it was derived, and under what circumstances.... however you had best be very clear as to why and how you didit... another whole SOW.

    THe only USPAP regs about this are the old Supplimental Standards bit which thank all the powers that be are so muddy as to be veddy unclear and you *may* be able to 'splain yourself well enought to avoid the second gotcha when reporting a second opinion of value on a form not intended for that purpose AND WHICH FORM SAYS SO RIGHT ON THE LABEL: no HC's or EA's which are needed to develop the 'as repaired' value...:Eyecrazy:

    Thou shalt not be misleading is the second USPAP directive to which I refer.

    Rotsa ruck figuring out how to SOW the thing so it works for your cleint...m:

    Have you considered presenting the report on one of the more appliable and safer General appraisal forms?
     
  4. Marcia Langley

    Marcia Langley Senior Member

    0
    Aug 26, 2005
    Professional Status:
    Certified Residential Appraiser
    State:
    Missouri
    Two different SOWs for sure. Are you sure they will only accept the 1004? It's not really condusive to the assignment.

    If it is for lending purposes I guess you could make it work but your addendum would be very difficult. It may be one assignment but it is definitely two appraisals.
     
  5. Terrel L. Shields

    Terrel L. Shields Elite Member
    Gold Supporting Member

    444
    May 2, 2002
    Professional Status:
    Certified General Appraiser
    State:
    Arkansas
    Actually, on FRT you used to need to report both the 'as is' value and the "as completed" value. I routinely do so. The SOW needs very little tweaking but you need to reference what you are doing.

    Often in new construction, the "as is" value is the lot value. The "as proposed" value is the completed value. When I run into partially built improvements, then it gets a little 'hairy'. A partially completed building is likely to have some functional issues therefore, a buyer might discount it for lacking finish.

    On farms, a tract with a dwelling may have a value as residential - grazing as is. And that may be the HBU 'as is'. But if they owner wishes to build say 4 poultry barns, then the "as improved" value is as a poultry barn. You may end up with 3 poultry sales (or more) and 3 residential - acreage sales (or more) to determine the as is and the as if completed values PLUS 3 or more land sales to support the value of the site 'as if vacant'.
     
  6. Fred

    Fred Elite Member

    0
    Jan 15, 2002
    Professional Status:
    Retired Appraiser
    State:
    Virgin Islands
    In the defintion section. You are confusing appraisal with assignment. An assignment can be 10 appraisals, a review and an appraisal, an appraisal and a consultation, etc.

    Not necessarily.
     
  7. PropertyEconomics

    PropertyEconomics Elite Member

    1
    Jun 19, 2007
    Professional Status:
    Certified General Appraiser
    State:
    New Mexico
    I have done these types of reports in the past ... I have always treated them as separate assignments .. One AS IS .. and One SUBJECT TO ... In my belief this is the least confusing and the reader can immediately look to the valuation line and know exactly what condition that value is based upon.
    Separate values ... separate assignments. In my opinion.
     
  8. George Hatch

    George Hatch Elite Member

    198
    Jan 15, 2002
    Professional Status:
    Certified General Appraiser
    State:
    California
    If you get an assignment that calls for 2 types of services - a review of someone else's appraisal and an appraisal of your own - do you call it 2 SOWs and render 2 separate reports? Of course not. It's one assignment with one SOW that involves performing more than one service or providing more than one value opinion.

    Why do you think they want the "as is" value anyway? Answer: to quantify the effect, if any, that the hypothetical condition upon which the "subject to" value is based has on value conclusion.


    This is a single assignment with a single SOW that involves 2 value opinions. There's no need to freak out or make more of it than what it is.
     
  9. Couch Potato

    Couch Potato Elite Member

    0
    Mar 15, 2004
    Professional Status:
    Certified Residential Appraiser
    State:
    North Carolina
    Well said.:rof:
     
  10. Don Clark

    Don Clark Elite Member

    15
    Jan 17, 2002
    Professional Status:
    Certified Residential Appraiser
    State:
    Virginia
    I second that

    What Steve Santora & George hatch said.

    Sometimes appraisers cannot see the forest for the trees. We tend to over complicate too many things. I have been doing appraisals with more than one value opinion longer than many on this forum have been in the business. There are many assignments that require more than one stated opinion of value. I don't see how that is hard to figure out, if you know how to write a scope of work.
     
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