C3 or C4

[Delta85]

I'm sure this has been beaten around many times. As we approach this CU apocalypse I just wanted to get last minute opinions on how you decide on condition ratings C3 or C4. For me these are close calls often times and I want to make sure I offer the best possible opinion that the majority of peers seem to agree on. The definitions leave a lot of wiggle room. Any thoughts?

 

[Dan Umstead]

Here is a prediction. I want to go on the record and say.............If the GOEs (government Owned Enterprises) fully implement CU, all appraisers will gather together and call all homes C4 (Average). This will foul-up the computer and appraisers will return to the "old days", where an appraiser made a determination of the comparable sale and made adjustments comparatively.

 

[J Grant]

The reality is, there will be some discrepancy among peers no matter what and I don't think CU intends for total conformity, they want explanations for variances and especially so when variances are substantial (Such as c4 vs c2 would set off an alarm whereas C3 vs C4 likely just a flag request for further explanation)

The best idea is read the UAD definitions several times, slowly, each section and let it sink in. They are pretty clear and specific for each category and one can't go wrong following them as closely as possible.

 

[Deleted member 77547]

I would think they're looking for the outliers, e.g., the appraiser who calls its a C2 when everyone else calls its a C3 or C4.

 

[Pam Wyant]

I'm sure this has been beaten around many times. As we approach this CU apocalypse I just wanted to get last minute opinions on how you decide on condition ratings C3 or C4. For me these are close calls often times and I want to make sure I offer the best possible opinion that the majority of peers seem to agree on. The definitions leave a lot of wiggle room. Any thoughts?

I agree they are often close calls. Sometimes it depends on the age of the home as well as the overall level of improvements. A 10-15 year old home without much done beyond paint would be a C-3, a 30-40 year old home with a new roof , new carpet, and maybe a renovated bath or two but nothing done to the kitchen would be a C-4. If the interior has been totally updated in the 30-40 year old home including the kitchen and all baths, a C-3. Because it still has older wiring, woodwork, drywall, functional layout, etc., I don't think it meets the definition of a C-2. Others may differ.

 

[timd354]

Here is a prediction. I want to go on the record and say.............If the GOEs (government Owned Enterprises) fully implement CU, all appraisers will gather together and call all homes C4 (Average). This will foul-up the computer and appraisers will return to the "old days", where an appraiser made a determination of the comparable sale and made adjustments comparatively.

Good luck with that plan...if you try calling every property a C4, you will likely receive a warning letter from Fannie Mae pretty quickly and may eventually end up on their AQM list or sitting in front of your state appraisal board trying to explain what the heck you were doing

 

[chad hampton]

If FNMA already knows what the home should be, C3 or C4, why don't they just send that info over on the order? Cause at this point, I don't care anymore.

Tell me what to use and I'll use it. Cause most home can be considered either one.

 

[J Grant]

FNMA doesn't "know" what the interior of a home is. They just have records from other appraisers stating what it is. If FNMA has 6 appraisals using a comp as C3, and you use C4, it might set off a flag and you will be asked to explain why your condition rating differs from peers/model.

It's pretty easy to call a subject condition C category correctly, harder on a comp where we have not been inside. All we can do is the best we can re MLS interior photos, agent interviews etc. If I have so little information on a property that I cant' state a condition with any confidence, I tend not to use that sale as a comp..

 

[Mr Rex]

It might be helpful if FNMA would provide an overlay of the Marshall and Swift Life Cycle Chart showing where the C ratings fall in their opinion. I've been playing with it a little just in case I need to justify a particular C rating.

 

[Pilgrum]

I think the question is answer in the UAD Definitions addenda..
There is nothing that says a comparable cannot have the same C rating as the subject and not be adjusted for a difference in condition. IE; The sale is freshly painted inside and out. Everything else is the same. Don't you think it's C rating would be the same but an adjustment is still due? Explain it! Lucy.