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  #1  
Old 10-18-2007, 11:06 AM
New Century New Century is offline
 
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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.
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  #2  
Old 10-18-2007, 11:27 AM
Tom Woolford Tom Woolford is online now
 
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USPAP does not dictate the form used for the report. You don't even have to prepare a report to be USPAP compliant.
  #3  
Old 10-18-2007, 11:28 AM
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Farm Gal Farm Gal is offline
 
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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...

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?
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  #4  
Old 10-18-2007, 04:03 PM
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Marcia Langley Marcia Langley is offline
 
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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  
Old 10-18-2007, 04:52 PM
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Terrel L. Shields Terrel L. Shields is offline
 
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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'.
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  #6  
Old 10-18-2007, 05:18 PM
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Quote:
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.
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.

Quote:
Actually, on FRT you used to need to report both the 'as is' value and the "as completed" value.
Not necessarily.
  #7  
Old 10-18-2007, 07:21 PM
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PropertyEconomics PropertyEconomics is online now
 
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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.
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  #8  
Old 10-18-2007, 07:55 PM
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George Hatch George Hatch is offline
 
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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  
Old 10-18-2007, 09:46 PM
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Couch Potato Couch Potato is offline
 
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Quote:
Originally Posted by George Hatch View Post
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.
Well said.
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  #10  
Old 10-19-2007, 08:04 AM
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Don Clark Don Clark is offline
 
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Talking 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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