Sale date of comp after effective date by 1 day

[Michigan CG]

I have used sales that never closed....actually got canceled. The meeting of the minds took place. It is a comparable.

Below are the two best answers imho.

Wouldn't it just be easier to use as a fourth contract comp (with the entire story in narrative). That way you are using the data, and using it properly with no guidelines ignored, without making another trip out to the property. Whats not to like, no one is accepting only three comps these days anyway...

Use the dang SALE that CLOSED as of your signature date on the report - then add narrative to explain that while it was pending as of the effective date......

 

[Carnivore]

I have used sales that never closed....actually got canceled. The meeting of the minds took place. It is a comparable.

Below are the two best answers imho.

Tim,

I am with you and Jim Klos and some others on this. In a court of law I believe they would not bat an eye if you used a actual sale that post dated the appraisal effective date assuming it was before the signature date. I think people would see that as long as the three dates were within the same contemporaneous period. That also assumes the appraiser made sure something earth shattering did not take place like a Giant manufacturing faciliy closing won or some thing else similar.

 

[redfish]

I would schedule a re-inspection and use the comp as a closed sale. It’s a pain with $4+ gas but if you’re asking if you can use the comp means to me that it would be a likely indicator of market value for your subject. Try to make a positive out of this situation by scheduling the appointment around lunch time and hit up one of the local restaurants near the subject that you haven't been to in a while. :new_all_coholic:

I just wondering but, if a L.O. called and said that "the neighbors house is going to close in a week and if you can reinspect we can use the comp to get the deal done", you would simply find a restaurant close by and wait till the sale closed and then throw it in the report and get the deal done. An effective date is an effective date, you can't just willy nilly reinspect and change it. How would you disclose the reason for revisting the property.

 

[TJSum]

Tim,

I am with you and Jim Klos and some others on this. In a court of law I believe they would not bat an eye if you used a actual sale that post dated the appraisal effective date assuming it was before the signature date. I think people would see that as long as the three dates were within the same contemporaneous period. That also assumes the appraiser made sure something earth shattering did not take place like a Giant manufacturing faciliy closing won or some thing else similar.

If everything was fair game prior to the signature date, why isn't that designated as the effective date. Your last sentence points to the problem of fudging on the inspection date effective date cutoff, do we really want to be held responsible for anything and everything that happens prior to the second we sign off on the report? You stated your belief that the courts would not bat an eye using a post dated sale, if that assumption is true, I would also doubt they would bat an eye to hold one responsible for all changes prior to signature date. Do we really want that???

 

[Mztk1]

I just wondering but, if a L.O. called and said that "the neighbors house is going to close in a week and if you can reinspect we can use the comp to get the deal done", you would simply find a restaurant close by and wait till the sale closed and then throw it in the report and get the deal done. An effective date is an effective date, you can't just willy nilly reinspect and change it. How would you disclose the reason for revisting the property.

I suppose willy-nilly, no. If you already submitted the report and the LO calls, then it is a new assignment. If the LO calls before you submitted the report and says, hey we just found out that...then there is no harm in waiting, inspecting again (charge a trip fee), and submitting the report for the first time with the later inspection date.

 

[redfish]

I suppose willy-nilly, no. If you already submitted the report and the LO calls, then it is a new assignment. If the LO calls before you submitted the report and says, hey we just found out that...then there is no harm in waiting, inspecting again (charge a trip fee), and submitting the report for the first time with the later inspection date.

If this is done you will also consider the 2 new active listings that were just listed, and the toxic waste spill near the old tree at the end of the street, and the ...... and the ,........ or would you just tell your L.O. buddy that reinspecting in this instance would actually have a negative impact on value and that the original effective date is the most benefcial to the overall cause.

What is the forum concensus on this?

Disclosure of property revisits or not. Signing the report is taking responsibility for the finished report based on the effective date of the report. The effective date is the snippet in time that the report captures. Reinspecting and applying a new effective date is a new assignment whether or not the appraisal has been signed and delivered. The effective date is the date of the report. Change the effective date and you have a new assignement regardless if it has been delivered. I would assume that a detailied workfile would include a revist to the property and the reason that the original effective date was revised and the orignal assignment were not completed, hence two workfiles for two assignments/effective dates. Looking for some input here. I don't know about this one. Do you have to disclose mutiple effective dates and revisists to the property.

Are you not acting as an advocate for the client or borrower by picking the most benefical effective date or revising the effective date due to information becoming available. Would advising your client to hold off on ordering the appraisal because you know of a home that is due to close in the sub that will support a higher value. Or flip it, there is a pending sale that could or could not support a lower value if it closes before your effective date, are you going to advise that the inspection be rushed or pushed ahead. Sounds like advocacy to me.

 

[Farm Gal]

If this is done you will also consider the 2 new active listings that were just listed, and the toxic waste spill near the old tree at the end of the street, and the ...... and the

Uh no because those things all HAPPENED prior to the signature date of the report and were covered in it OR happened after and can be addressed as a customer service issue! Frankly if there were a nuclear accident or a chemical spill big enough to make the news, I'd plan on a call to the lender before sending off the report anyway because it surely will become my problem.

And as to the two listings if the lender has an ax to grind I will consider em... I also consider a Bill to the lender after sharpening my own ax and chopping the problem down to size!!

would you just tell your L.O. buddy that reinspecting in this instance would actually have a negative impact on value and that the original effective date is the most beneficial to the overall cause.

Uh I ain't got none of them LO Buddies.. OK, well ... one but I don't do appraisals for him!

What is the forum concensus on this?

With all due love and affection for most of the inhabitants here I do not necessarily consider some of the more reactionary and poorly informed to be my PEERS.

Disclosure of property revisits or not. Signing the report is taking responsibility for the finished report based on the effective date of the report. The effective date is the snippet in time that the report captures.

and who wrote a ROOLE that I can't consider sales closed after that I knew about before OR which were somehow lost in a black hole and surfaced later? IF there is a better sale brought to my attention after my original signature date. I will consider it... with no change in effective date a comment or two is FINE... I may change the signature date on the report OR add a comment page with a more recent signature if my value opinion has not changed... However if this happens weeks after the report is written - not so much! Ya gotta draw the line somewhere!

Reinspecting and applying a new effective date is a new assignment whether or not the appraisal has been signed and delivered.

Not neccesarily... Not unless I get client input in the form of a new appraisal request!!

The effective date is the date of the report.

Yup. For Fannie, Freddie and the now defunct Indy Mac... but not for all cleints on all appraisal assignments!

Change the effective date and you have a new assignment

Nope. I can reinspect as many times as I want and the folks will let me in - has nothing to do with anything except which property condition/date I chose to report. To some reasonable extent I get to pick that which makes the most sense...and ya best not all me Skippy! Usually the effective date is the last date of inspection or you wind up having to explain a lot of reasons why... There is NO USPAP requirement to list all the times you inspect a property. You merely have to pick ONE to use for the effective date!

I can have an effective date the day before a house burns down and an effective date afterwords on the same 'assignment'! Don't slice that onion too thin - it'll TEAR.

regardless if it has been delivered. I would assume that a detailed work file would include a revisit to the property and the reason that the original effective date was revised and the original assignment were not completed, hence two work files for two assignments/effective dates. Looking for some input here. I don't know about this one. Do you have to disclose mutiple effective dates and revisists to the property.

Nope, see above

Are you not acting as an advocate for the client or borrower by picking the most benefical effective date or revising the effective date due to information becoming available. Would advising your client to hold off on ordering the appraisal because you know of a home that is due to close in the sub that will support a higher value. Or flip it, there is a pending sale that could or could not support a lower value if it closes before your effective date, are you going to advise that the inspection be rushed or pushed ahead.

Uh why would I want to do any of those?

Sounds like advocacy to me.

Well IF an appraiser is silly enough to advocate as your prior paragraph... or for anything except the best and most recent and supportable opinion of VALUE supported by the most representative sales available... they deserve whatever harm befalls them. If however they hold off 24 hours for the 'perfect' or at least most recent sale - I am happy to call on any of several highly respected authorities in the field of appraising to defend my actions... See if you pay for the better quality of education, and argue details often enough on this site, you eventually get to the point where you know some really well-respected individuals who would stand behind the class notes you took over a couple of decades!

And those folks I am willing to call peers!

 

[redfish]

With all due love and affection for most of the inhabitants here I do not necessarily consider some of the more reactionary and poorly informed to be my PEERS.

Are you calling me poorly informed?

I didn't ask for a peer response I asked for a forum response.

and who wrote a ROOLE that I can't consider sales closed after that I knew about before OR which were somehow lost in a black hole and surfaced later?

I didn't

IF there is a better sale brought to my attention after my original signature date. I will consider it... with no change in effective date a comment or two is FINE... I may change the signature date on the report OR add a comment page with a more recent signature if my value opinion has not changed... However if this happens weeks after the report is written - not so much! Ya gotta draw the line somewhere!

"Draw the line somewhere" yeah with your effective date.

I need to get something straight. If I inspect a property I should hold out as long as the client will tolerate so as not to miss an economic event. The effecitve date is the snippet in time that the value is being opinioned. Any appraiser completing reports on the east coast during hurricane season better hold off to sign a report until the tropical depression off the African coast veers towards Iceland.

See if you pay for the better quality of education,

What do you know of my education

and argue details often enough on this site, you eventually get to the point where you know some really well-respected individuals who would stand behind the class notes you took over a couple of decades!

I am humbled.

And those folks I am willing to call peers!

But are they willing to call you a peer?

Why are you throwing around the peers thing so much. What's your problem.

My opinion of value as of the effective date of this appraisal.....that I changed multiple times with several inspections until the market conditions and available data was perfect......

I am fine with client imposed effective dates as long I inspect at said effective date or provide an extraordinary assumption in the case of a retro date, but with out client specific instructions I will not willy nilly pick an effective date to complete the report to advocate anything other than my assignment results.

My Bold

 

[Carnivore]

If everything was fair game prior to the signature date, why isn't that designated as the effective date. Your last sentence points to the problem of fudging on the inspection date effective date cutoff, do we really want to be held responsible for anything and everything that happens prior to the second we sign off on the report? You stated your belief that the courts would not bat an eye using a post dated sale, if that assumption is true, I would also doubt they would bat an eye to hold one responsible for all changes prior to signature date. Do we really want that???

Define Effective date with a source?

Why cant Inspection date and effective date be two different dates.

Define Contemporaneous period while keeping retrospectve date in your mind with a source if possible.

Do we want what? To be held responsible for everything prior to our signature date? We already are!

 

[Mike Kennedy]

The point is, it's appropriate. It always was. What a profound statement.

here's another. DUH.