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  #1  
Old 10-22-2011, 01:37 PM
prasercat's Avatar
prasercat prasercat is offline
 
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Default Using the contract section in a refinance?

I find it odd that I have not encountered this before.

I appraised a home about 9 months ago and at the time it was a sale. Now the home is undergoing a refinance from the same lender.

I'm not sure whether it is OK, to leave the contract price and description of the contract on page one but mark "refinance". My gut feeling is that someone will complain.

Normally, when there is a prior sale of the subject (within 36mo) this information would be included at the bottom of the sales grid with the listing/marketing information on page 1 if that sale occurred within 12 months.

However, the form question is: "I [ ] did [ ] did not analyze the contract....." Naturally, I did. So then I must fill in the contract section. If the contract section is filled out, then it appears to me, I then need to fill in the contract price and date of contract. If that is filled in, then I must fill in the concession information. So basically, the flow of the form requires me to keep that info into the contract section, because I did analyze the contract. In this case, the sales grid will show the contract price and the sale date as it would in a sale transaction.

Basically, I have never before checked off "refinance" with the contract section filled out. Appendix D, UAD doesn't help either - the language is too general or "porous".

Is this OK? It doesn't appear that there is another option. I'm perfectly happy doing it this way, it's just uncharted territory for me.

Thanks
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Old 10-22-2011, 02:00 PM
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Smokey Bear Smokey Bear is offline
 
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Default

Quote:
"I [ ] did [ ] did not analyze the contract....."
What's left unsaid is 'for the current transaction'. Leave it blank and comment in the section on prior sales.
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  #3  
Old 10-22-2011, 02:18 PM
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VolcanoLvr VolcanoLvr is offline
 
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Default

Smokey is correct.

You're getting hung up on this because you were the appraiser at the time of the sale, and had a contract to analyze, then.

Now you're doing a refi appraisal. If you had NOT been the original appraiser for the sale, would you now want to get a copy of the sale contract? Probably not, except that you'd want to determine if there were any concessions that applied to the sale, which you would do by talking to the Agents involved.

So, just leave the contract section blank.

Be sure to indicate in the report that you have had 'prior involvement' with the property. And indicate the sale info at the bottom of the grid.
  #4  
Old 10-22-2011, 02:35 PM
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I agree with the two prior posts. Comment on the bottom of the sales comparison analysis. You can put the same information there that you would put in the contract section on page 1. This is a refi appraisal now and not a purchase. So, report what happened in the necessary sections of the URAR.
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  #5  
Old 10-22-2011, 02:41 PM
WindyJRTX WindyJRTX is offline
 
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Default

I agree with the other replies. Filling in the contract section would imply that there is a current contract on the property and would be confusing to the reader. This is a new assignment with a new scope of work. And, per USPAP, you are required to let the client know you have performed services regarding the subject property as soon as you are aware of this, and also to disclose prior services in your report.

Reference: http://www.norcal-ai.org/dwnld/Hot_T...ich-042810.pdf
  #6  
Old 10-22-2011, 03:09 PM
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prasercat prasercat is offline
 
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Default

Thanks everyone for the UNANIMOUS replies and that comment about prior involvement wasn't even on my mind at the moment, but you had nipped that one in the bud too!

I think alamode could have helped me not feel so "locked in" (in the absense of guidance elsewhere) if instead of configuring their "Pop-up box" with the words "If the transaction was a purchase transaction, was the contract analyzed?", had instead two questions: 1) "Is the intended use of this appraisal for a purchase transaction..... [Y/N]" 2) "If yes, then was the contact analyzed? [Y/N]".
  #7  
Old 10-22-2011, 04:01 PM
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VolcanoLvr VolcanoLvr is offline
 
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Default

The AppraisersForum is a valuable resource!

In defense of alamode (I have some direct contact w/ them), the pop-ups on the UAD compliant forms were somewhat mandated by Fannie/Freddie, and the private company who helped implement the process. Thus the wording was incorporated as they wished.

The Contract section info on the forms has always related ONLY to a subject property under a purchase and sale agreement. It has never related to refi's.....except in that one Subject section entry field that forces you to reveal how you determine that the property is or is not currently or was recently offered for sale.
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