Appraiser

[Charles Knutson]

Look for comps with similar acreage and market appeal as the subject, and then allocate 10 hypothetical acres for each of the comps in the grid.

In the comment addendum, describe the actual acreages of all the properties, and the contributory value of the land that exceeds the 10 acre hypothetical.

That way, you've complied with the lender stip, but used the comps that best reflect the value of the actual acreage of the subject property.

 

[Richard Carlsen]

Can you appraise 10 acres with a house that is part of a site that is 28 acres? Sure you can.

Can you do it for lending determination? Sure you can if it does not violate the Supplemental Standards of any user or secondary market.

Can you use the FNMA form to do this? Sure you can as long as that report form is not being used in a Federally Regulated transaction.

The bottom line is that you have to know the Intended Use and the Intended User of the report in order to remain USPAP compliant by not violating any Supplemental Standards.

It's time for you to reread the FNMA Appraisal Guidelines and to have a discussion with your client on the use of the report.

 

[Greg Bell]

Can you appraise 10 acres with a house that is part of a site that is 28 acres? Sure you can.

Can you do it for lending determination? Sure you can if it does not violate the Supplemental Standards of any user or secondary market.

Can you use the FNMA form to do this? Sure you can as long as that report form is not being used in a Federally Regulated transaction.

The bottom line is that you have to know the Intended Use and the Intended User of the report in order to remain USPAP compliant by not violating any Supplemental Standards.

It's time for you to reread the FNMA Appraisal Guidelines and to have a discussion with your client on the use of the report.

FNMA Will not buy partial land appraisals , however , many lenders in house will.Doesn't make sense because you would foreclose on ALL of the parcel , not a hypothetical corner when the loan goes South........

 

[Richard Carlsen]

FNMA Will not buy partial land appraisals , however , many lenders in house will.Doesn't make sense because you would foreclose on ALL of the parcel , not a hypothetical corner when the loan goes South........

FNMA says you cannot do it and that is part of the Supplemental Standards so you cannot do it.

As far as making sense on the foreclosure side, that is not a concern of the appraiser because it is not something that we are asked to consider in the assignment. So if it is not part of the assignment consideration, why worry about it? It is somebody else's problem. If somebody else wants to hire me to give an opinion on using a partial value for lending consideration, I'll be happy to give my opinion on it (for a fee of course).

Appraisers learn to keep their noses out of other peoples business. When you start concerning yourself with things that are not part of the appraisal assignment, you tend to muddy the waters for the intended use of the report and you extend your liability into areas where you are not qualified and quite frankly, areas where your E&O insurance may not cover. Why anybody, in the name of Holy Mother Oprah, would want to become a do-gooder, saving the oppressed, while completing an appraisal assignment, is beyond me.

 

[Joker]

Actually, this is a USPAP issue. You must be able to "adequately identify" the parcel being appraised. If you are compentent enough to do that without a survey or a legal description, then so be it.

As said before, my question is always "which 10 acres do you want appraised?"

 

[The Bob]

Richard,

The SS rule is no longer part of USPAP. You would address this in your SOW.

 

[Richard Carlsen]

The SS rule is no longer part of USPAP. You would address this in your SOW.

I guess I knew that but it is hard to shift gears sometimes. One must still follow the guidelines in order to produce credible assignment results. A report developed contrary to the assignment requirements (FNMA prohibition of partial site valuation) would not be credible since the assignment results would not be of any use to the client and contrary to the assignment.

Guess that says just about the same thing but in the new context of USPAP 2008.

( http://commerce.appraisalfoundation...er/uspap_foreword/USPAP_Table_of_Contents.htm )

 

[bfriendly]

In Amish country they like the patchwork look.

Take it easy on us Amish Folks!

Hold still for just a sec.......:new_snipersmilie:


Back to your question, it was answered right off the bat with "WHICH 10 ACRES, EXACTLY?"

Once they give you that in a relilable form, then you can do the appraisal.

 

[Richard Carlsen]

Over the years, I've done a lot of these (even for lending consideration when they were permitted). Sure we did an HC but that was permitted also. So if were were doing an HC, we normally would choose the most reasonable site. If the site were a typical 20 acre site (660 x 1320) with 10 acre sites in the area, we would describe the hypothetical site as the one that contains the improvements with dimensions of 330 x 1320. I've had them where the house was located in the corner of a square 40 acre parcel and they wanted only 5 acres so the site that was set up in the HC was a square 5 acre site in the corner that contained the improvements (466.7 x 466.7).

Since you are doing an HC to begin with, you can easily add one more HC for the site to make it conform to the neighborhood since the whole appraisal is based on pretend.

 

[CANative]

Since you are doing an HC to begin with, you can easily add one more HC for the site to make it conform to the neighborhood since the whole appraisal is based on pretend.

I suppose it would be OK if the loan is just a "pretend" loan and the lender will only "pretend" to foreclose on the "pretend" lot. Otherwise I don't think it's OK because the actual property that is to be the actual collateral of the actual loan is not being appraised.

If a lender client wants to reduce LTV based on their perception that residential lots larger than xx acres have more risk, there are ways to do that that don't involve misrepresenting the property.