Retrospective Appraisal - Special Form/Addendum Required?

[Webbed Feet]

I just completed one of these critters, also for 2007.

While in most cases I would agree with Denis about form usage, sometimes the client specifies which one they want, and while not 'technically' correct it may be better to roll with it and add additional language as appropriate through the report.

I put this verbiage in Bold type on the Reconciliation section comment line just above the OMV and date: "NOTE: effective date of this report is retrospective to 6/26/2007 per client, with the inspection done on 1/18/2010 (this modifies the pre-printed statement below)."

Thanks Greg for reminding us about Stmt 3.

If you're also licensed down here in Oregon... I strongly recommend you call the Oregon ACLB before you try that down here. But then I would have recommended you call the Washington board before doing that too.

 

[Webbed Feet]

Jake is correct.
However, there is a set of forms that I would not use: they are the current version of the Fannie/Freddie SFR, condo, 2-4, co-op or manufactured housing forms which state that the effective date of the appraisal is the same as the inspection date.

I'd also read SMT-3 as Greg suggests.
Most likely you'll need some EA.

Good luck.

Big Ditto... and I'd refuse to use the 03/2005 2055 form for such an assignment. But then, I refuse to use that form for any assignment..

 

[VolcanoLvr]

Hey Webbed......

You're fond of holding the OR board up against all others. They may be well versed in all things Forms/USPAP, acting as the Appraiser Police. But not all states act like that, especially here in WA.

Our 'board' is merely advisory and has no enforcement powers. That's handled by the Department of Licensing investigators. Many of them (the investigators) are not appraisers by training, and many of them do not concentrate entirely on appraisal matters. They don't investigate an appraiser unless a complaint is filed, and even then it can take a year to work to the top of the pile.

Back to the issue at hand. USPAP does not dictate the 'form' as you well know. Fannie's forms do not comply 100% with USPAP. So putting a statement on the form as I have done (and will continue to do) is not a serious violation of anything, in my gray haired opinion. I have disclosed and explained, just as Fannie expects.

If I determine that MY Scope of Work will not be sufficiently covered by the 3/05 2055 Form, then I will tell the client so, recommend another form if that what they want/need, do a narrative (probably not!), or decline the assignment.

But I'm not necessarily going to turn the assignment down just cuz you don't like that form. Frankly, you shouldn't either.

 

[Webbed Feet]

Hey Webbed......

You're fond of holding the OR board up against all others. They may be well versed in all things Forms/USPAP, acting as the Appraiser Police. But not all states act like that, especially here in WA.

That's odd. Back when I bothered to keep a Washington license every single time I called the Washington board to discuss interesting topics of concern I generally got the exact same answers out of them as was coming out of the Oregon board at the time...

I guess all things change, huh?

 

[hastalavista]

While in most cases I would agree with Denis about form usage, sometimes the client specifies which one they want, and while not 'technically' correct it may be better to roll with it and add additional language as appropriate through the report.

Dave-

I hear you. :new_smile-l:
I think you are in the majority with most appraisers. They'd do the same thing and, if nothing went wrong, there would be no consequence (and, most of the time nothing does go wrong).

I know for a fact when Fannie Mae rolled out the revised forms, I heard first-person from one of the designers (Joe Minnich- I don't think he's with Fannie any more) that Fannie's position was any appraisal completed on one of their new forms included Fannie as an intended and it was explicit (by virtue of the non-modified certification) that the report met the GSE guidelines. When asked about situations where the appraisal wasn't intended for GSE use, the reply was something like then don't use that form or complete the appraisal as if it was intended for us, because if it is on our report form and someone uses it in a loan submission to us, you (the appraiser) will be held responsible.

Although I might be able to escape being found liable for damages in a lawsuit, I do not think I could escape a sanction from my state regulator if the complaint submitted was based on the pre-printed form stating one thing and then I modifying the form even when the form states no modifications.

I view this as maybe low-risk (the chances that something goes wrong is low) but high-liability (if it does go wrong, I'm in big trouble) proposition. So, I error on the side of safety (talk the client into another type of reporting option).
Others on this forum have argued that there is no issue. :new_smile-l:

 

[monkey525]

Extraordinary Assumption.. this property was purchased about a month ago (before the retro effective date) by Diversified Properties (looks like a investment group) and prior listing shows that this property was in a REHAB condition. I doubt that much work/renovation was made after one month of purchase, so I guess my extraordinary assumption is still "Fair-Average" condition and I do have similar comparables around that time (Properties sold "as-is", "need TLC", etc.).
Couple more things.. should the real estate and special assessment taxes amount be for 12/2007 or current?
Should I discuss anything about the activites that occured after 12/2007? (Such as the purchased date/price after renovation?)
Thanks everyone for their feedback(s). You guys are brilliant!!

 

[Webbed Feet]

Modifying the SOW is prohibited on 03/2005 2055

This may be a stupid question but it's my first time doing a retrospective appraisal. Do we need to include any special form(s) or addendums on this drive-by form?

If you mean the 03/2005 Fannie 2055...... Care to explain how you are going to use an EA without violating the prohibition against modification of the SOW? You have bothered to read ALL of the preprinted language on that form? To opine regarding interior condition that form demands that credible (actually, does not it is use "accurate?") information be available. Certification number 10 demands that this information be verified with a disinterested third party. A small but sweepingly important item that should in most cases make the 03/2005 Fannie 2055 form unusable. Because in most cases a well informed, completely disinterested (can't be your client!) third party cannot be found. Let alone found for $100 to $250 for an exterior only.

Once you declare, in your SOW, that the analyses is "Based" on a retrospective past date... then EVERYTHING you use on that form is as per that date. You do not use 2009/2010 data for anything.. taxes included. Your analyses, the reporting, is all "Based" on the past date being used. Why would you be discussing activities going on in 2009/2010 when a 2007 effective date is being used? ...

You have so many questions, good questions, but so many that I have to start to question if you are yet competent for this assignment. Clearly, you have not spent enough time with your USPAP studying the SOW Rule, reading that forms preprinted language, studying SMT-3, and communicating with your client regarding SOW to be prepared for this assignment.

P.S. BEFORE you go sticking in EA's while completely disregarding the 2005 form prohibitions against modifying the SOW, you had better be calling the Maryland appraisal board about it. If it was my assignment I would instantly be informing my client that due to the 2007 date needed, due to the absolute need for EA's regarding condition, due to cert 10 on the 03/05 2055 and other preprinted language on prohibiting modification of the SOW, that if they want an exterior only inspection the reporting is going to be on the 1996 Fannie 2055, not the new one.

 

[BRCJR]

Refer to Post 3 and Post 17 for the best advice so far.

 

[Em Tee]

If you're also licensed down here in Oregon... I strongly recommend you call the Oregon ACLB before you try that down here. But then I would have recommended you call the Washington board before doing that too.

Our state board (OREA) also says you cannot contradict preprinted language. It creates a misleading report.

 

[jakeboeger]

Extraordinary Assumption.. this property was purchased about a month ago (before the retro effective date) by Diversified Properties (looks like a investment group) and prior listing shows that this property was in a REHAB condition. I doubt that much work/renovation was made after one month of purchase, so I guess my extraordinary assumption is still "Fair-Average" condition and I do have similar comparables around that time (Properties sold "as-is", "need TLC", etc.).
Couple more things.. should the real estate and special assessment taxes amount be for 12/2007 or current?
Should I discuss anything about the activites that occured after 12/2007? (Such as the purchased date/price after renovation?)
Thanks everyone for their feedback(s). You guys are brilliant!!

The subject should be identified as of the effective date. I have used sales that occured after the effective date, but I try to stay as close as possible. The beautiful thing about a retro assignment is that you actually know what happed after the effective date. You can use that to your advantage.