Gated Community

[Delta85]

Do you think an appraiser should perform a field review (FNMA 2000 Rev 3/05) when he/she cannot gain entrance to the development. I'm seeing a lot of these.

SOW states "the appraiser must, at a minimum, (2) perform a visual inspection of the exterior areas of the subject property from at least the street", which he/she has not done.

Certification #1 states "I have, at a minimum, developed and reported this appraisal feld review in accordance with the scope of work requirements stated in this appraisal field review report", which is false.

IMO if you can't see the subject for yourself then it is not really a field review and should not be identified as such.

 

[Delta85]

I look at MLS for all listings in the PUD and get a gate code from MLS. Then I use it. Come-on guys. User your head.

Is that legal? Is that a can of worms you really want to open just for a review?

 

[Sunshine in VA]

From the OP, it sounded like it was an REO? Then the bank would have the right to access.

The field review was ordered by the MI company through an AMC so even if it was an REO property, we would not grant them access.

 

[Delta85]

I do this often, also if there is not a guard at the gate just wait and follow another car in.

This sounds real 007 to me. Are we really required to act like spys just do complete a review? Many residents are on the lookout for crooks trying to do the same thing you describe and if they notice you doing it may call police. Do you really want to explain why you are inside the gated community without permission and why you felt the need to piggy back another car to gain entrance? It's kind of tacky. Almost as bad as standing by a locked door to an apartment building and slipping in as someone leaves or enters.

 

[Sunshine in VA]

Disclaimer: I have not read anything between this post and the original post so I am sure someone has already given this same answer.


Basic principle of appraisal report writing, don't say you did anything you did not do! In both states where I am licensed, making false statements in an appraisal report performed for lending purposes constitutes mortgage fraud and may be prosecuted as such. Anyone defending such actions should lose their appraisal license IMHO.

Since starting this thread, I have contacted the state appraisers board where the property is located. I was pointed to:

SCOPE OF WORK RULE3
For each appraisal, appraisal review, and appraisal consulting 363 assignment, an appraiser must:
365 2. determine and perform the scope of work necessary to develop credible assignment results; (which FNMA has done on their form)
366 3. disclose the scope of work in the report (preprinted on Form 2000)
370 Comment: Scope of work includes, but is not limited to:
372 the extent to which tangible property is inspected;
and

Standards Rule 3-6
Comment: A signed certification is an integral part of the Appraisal Review Report. A
1177 reviewer who signs any part of the appraisal review report, including a letter of transmittal,
1178 must also sign the certification.
1179 Any reviewer who signs a certification accepts responsibility for all elements of the
1180 certification, for the assignment results, and for the contents of the Appraisal Review Report.

 

[Don Clark]

Since starting this thread, I have contacted the state appraisers board where the property is located. I was pointed to:

SCOPE OF WORK RULE3
For each appraisal, appraisal review, and appraisal consulting 363 assignment, an appraiser must:
365 2. determine and perform the scope of work necessary to develop credible assignment results; (which FNMA has done on their form)
366 3. disclose the scope of work in the report (preprinted on Form 2000)
370 Comment: Scope of work includes, but is not limited to:
372 the extent to which tangible property is inspected;
and

Standards Rule 3-6
Comment: A signed certification is an integral part of the Appraisal Review Report. A
1177 reviewer who signs any part of the appraisal review report, including a letter of transmittal,
1178 must also sign the certification.
1179 Any reviewer who signs a certification accepts responsibility for all elements of the
1180 certification, for the assignment results, and for the contents of the Appraisal Review Report.

And,

If I was hired by the appraiser as an expert witness/consultant I could easily discredit the claim that he/she violated USPAP by not gaining entry to a gated community. Appraisers are not expected to violate the law of tresspass by lying and cheating to gain entry to any property or community that they are excluded from.

 

[JSmith43]

Occasionally, I get a client that offers me flexibility with respect to access issues (default to 2055 if no interior access is available), for example.

Restrictions of access from the street is not so common as to be anticipated.

Sunshine should just disclose the issue of the cert & disclosure of the lack of access from the street, which is in the form of a photo of the gate & hopefully some commentary, plus comment on how well the appraiser addressed the effect on credibility, the fact that direct exterior observation of the home & immediate neighborhood was not possible.

This is a great thread, because it also lets us debate about how to handle such situations when doing reviews. Cell phones are pretty handy. To client: "Hi, I'm reviewing zzz & can't get access. Credibility will be effected, the report will/will not retain sufficient credibility to be useful (trip fee & stop if not useful). Will you agree to this limitation? I'll have to address the conflict with the certification. I'll summarize our conversation on my iphone & send you an email with the summary that you can OK and send back to me so that I can proceed in a timely manner. Thanks."

 

[J Grant]

SCOPE OF WORK RULE3
For each appraisal, appraisal review, and appraisal consulting 363 assignment, an appraiser must:
365 2. determine and perform the scope of work necessary to develop credible assignment results; (which FNMA has done on their form)

(Your parenthesis about the form)
The appraiser determines the scope of work to develop credible results, not a preprinted form, even if it is a FNMA form. The language in USPAP says the appraiser determines the scope of work necessary to produce a credible report, I don't see how an appraiser violated that if it is clearly disclosed on the report the scope of work the appraiser performed, in this case driving to a gated community and being denied access. A pre printed form does not determine the scope of work, the appraiser does.

366 3. disclose the scope of work in the report (preprinted on Form 2000)

(Your parenthisis about the preprinted form)
USPAP states what the appraiser states is what they are responsible for, even if it differs from what is on the preprinted form.
Yes, we take responsiblity for what we sign and write. If an appraiser dislcoses they were unable to inspect subject house from street, then they have met standard 366.3. they have disclosed the scope of work they have performed to develop the report.

370 Comment: Scope of work includes, but is not limited to:
372 the extent to which tangible property is inspected;

The above states THE EXTENT to which tangible property is inspected. If the extent was that inspection was not legally permissible and the rev appraiser still feels they can do a credible report, this satement says the review appraiser went on to develop a credible report relying on other sources than ext inspection of subject house.

Standards Rule 3-6
Comment: A signed certification is an integral part of the Appraisal Review Report. A
1177 reviewer who signs any part of the appraisal review report, including a letter of transmittal,
1178 must also sign the certification.
1179 Any reviewer who signs a certification accepts responsibility for all elements of the
1180 certification, for the assignment results, and for the contents of the Appraisal Review Report.And,

All of the above. The review appraiser certifies, through their disclosure, that despite attempts to access, access was denied, and they could stilll develop credible results. The photo of the security gate is part of the exhibits. The client accepted the conditions of the report and SOW and knows no access was granted. FNMA, who developed the form, accepts origination driveby appraisals where the appraiser could not get access to photograph the subject, so I don't know where the argument for incompetence or fraud fits in on completing an assignment with disclosure of non access for ext photo/inspection.

 

[Smokey Bear]

Why all the trouble to keep using the wrong form? If you can't get access, have the client change to a desk review. Geez, it's not rocket surgery.

 

[J Grant]

Mentor, I agree, I always confirm with client if I cannot get access pre report.

The OP is trying to discredit a review appraiser who performed a review in a gated community ( he is hired by the lender to defend possibly faulty appraisals against the reviews)