Safety concerns and conventional lenders

[Wayne Henry]

I would like to get a straight answer and some direction on this question if possible. I am working with a large conventional lender and they have asked me to clarify safety hazards that I am noting in my reports.
I was instructed to make my reports subject to when there are safety concerns noted.
I need link or something to reference for the continuous calls regarding handrails and bars on windows without safety latches.

I remember from my FHA guidelines that a handrail is required on three or more stairs and if there are bars on the windows a safety latch is required.

When the forms changed it was understood that Fannie Mae/Freddie Mac has adopted FHA safety guidelines which is why FHA is not requiring a VC sheet any longer.

Is it normal practice to site handrail or bars on the windows. Is this lender specific or is it a general safety concern for Fannie Mae/Freddie Mac. I am concerned mostly with conventional lenders because this is where the bulk of my business is generated.

Thank you in advance for your help and time regarding the aforementioned concerns.

 

[PropertyEconomics]

Mr Henry,
As often as I can I prefer to point these deficiences out to the owner / or realtors and ask them if they will correct them and I go back and do a second inspection so as to not have an appraisal subject to. I do this primarily because I live in a smaller community and the realtors are a very strong part of my practice and as such I want them to be aware of the issue and then get it fixed so as to not cause a problem with the loan.
Im sure many others will disagree with me but its a business decision I have made and it works very well in my market. The realtors are very open to the repairs and appreciate my notifying them
Property owners are appreciative in that it doesnt cause troubles in their loans.
I dont charge to reinspect. Its a courtsey I provide.

 

[Terrel L. Shields]

they have asked me to clarify safety hazards that I am noting in my reports

are they asking you to clarify them or fix them? You can download the FHA manual and thumb through that for an answer.

When the forms changed it was understood that Fannie Mae/Freddie Mac has adopted FHA safety guidelines which is why FHA is not requiring a VC sheet any longer.

Why would that matter? The VC sheet was an excellent mechanism for foisting these problems off on someone else, and I personally think it was done to put the liability back on the appraiser. As for fannie, I don't recall them issuing a new appraisal guide since the new forms came out. The current regs are impossible to understand in the context of not knowing who and which apply or do not.

Is it normal practice to site (sic) handrail or bars on the windows.

FHA has requirements regarding the height where handrails are required and how closely spaced they are. I don't think the 3 step rule is applicable but rather a specified height (36"-if i recall but I dropped off FHA 10 years ago) and I believe they require some form of exit to a bedroom in the event bars are present. I don't think it requires every window in a room to be accessible, but there needs to be 2 exits to every bedroom.

 

[Mr Rex]

I think you were misinformed as to why the VC sheets were retired, it was because FHA was losing market share, not because Fannie and Freddie had adopted FHA standards. In any case, safety hazards are safety hazards. Bars on windows with no safety release is dangerous and should be reported if for no other reason than to CYA (people die in fire after your appraisal, ambulance chasing attorneys will have you in their cross hairs). As for handrails, I would suggest calling the local code enforcement and finding out what current code requires. If an older home doesn't meet that code, report it as such, and let the lender decide if its worthy of requiring repair etc. FWIW, as the market tightens, I would suggest more due diligence, not less, even as the MBs and LOs raise holy hell because "you are killing their deals" because you tell the truth. Ask them to put their crap in writing and for a copy of their E&O and see what they say.

 

[Don Clark]

I think you were misinformed as to why the VC sheets were retired, it was because FHA was losing market share, not because Fannie and Freddie had adopted FHA standards. In any case, safety hazards are safety hazards. Bars on windows with no safety release is dangerous and should be reported if for no other reason than to CYA (people die in fire after your appraisal, ambulance chasing attorneys will have you in their cross hairs). As for handrails, I would suggest calling the local code enforcement and finding out what current code requires. If an older home doesn't meet that code, report it as such, and let the lender decide if its worthy of requiring repair etc. FWIW, as the market tightens, I would suggest more due diligence, not less, even as the MBs and LOs raise holy hell because "you are killing their deals" because you tell the truth. Ask them to put their crap in writing and for a copy of their E&O and see what they say.

Right you are. FHA appraisal request were off by more than 40% for several years. And, Fannie Mae has not adopted FHA Requirements. They still go by Fannie Mae guidelines.

Try this link:

http://appraisersforum.com/fannie-mae-guidelines/

 

[PropertyEconomics]

If interest rates rise ... FHA will become important again .. as the RE-NEW-ORIGINAL-SUBPRIME Lender ...

 

[Mike Garrett RAA]

A 3% down payment might look pretty good in the future! FHA will make a come back. I believe the hand rail thing is more than two risers. Security bars must be openable from the inside.

 

[PropertyEconomics]

A 3% down payment might look pretty good in the future! FHA will make a come back. I believe the hand rail thing is more than two risers. Security bars must be openable from the inside.

Security bars must be openable from the inside on atleast ONE window in each bedroom. THe other windows in the house may be permanently affixed and not openable to the best of my knowlege.
Atleast that is the fire code here.

 

[Jerry Bone Jr]

Wayne, it sounds to me like you're making FHA requirements to a conventional appraisal. I don't think we're suppose to do that.
But even if we are, we no longer make the requirements.
Now we only report the facts & let the DE Underwriter make any requirement.
Example:
1. The security bars don't have safety release latches.
2. The deck/stairs/patio does not have a hand railing.
I have, in the past, included a statement, that the DE UW is to make any requirement.

 

[Wayne Henry]

Thank you all for your comments regarding my questions but with all do respect I am even more confused now than I was before on how to handle this. Is there something concrete that someone can direct me to that will help me make a decision as to what type of practice is acceptable for my lenders, or should I ask the lender? I do not want to mark these loans subject to due to a safety hazard (handrail, bars on window) if it is not necessary. It seems there is not a consensus regarding these matters and that bothers me. Were appraisers we should not be using words such as I think and maybe in my opinion we should have concrete fact to back up our practice. Concrete help someone please.