Slippery Slope: As-repaired And The Appraiser's Assumption

[residentialguy]

Of course the appraiser tells them what the minimum repairs need to be performed.

You're appraising a house and the deck is missing off of the rear door and now opens to a 4 ft drop. What's the "minimum repair"?

 

[J Grant]

Below from the 1004 D in red:

INTENDED USE: The intended use of this certification of completion is for the lender/client to confirm that the requirements or conditions stated in the appraisal report referenced above have been met.

This is means appraiser did their job competently on the OA by describing the condition clearly enough for it to be met by the repair ( stating repair or replace loose boards on deck), . That means there is still a DECK, folks!

INTENDED USER: The intended user of this certification of completion is the lender/client. HAVE THE IMPROVEMENTS BEEN COMPLETED IN ACCORDANCE WITH THE REQUIREMENTS AND CONDITIONS STATED IN THE ORIGINAL APPRAISAL REPORT? Yes No

If No, describe any impact on the opinion of market value.

APPRAISER’S CERTIFICATION: I certify that I have performed a visual inspection of the subject property to determine if the conditions or requirements stated in the original appraisal have been satisfied. SUPERVISORY APPRAISER’S CERTIFICATION: I accept full responsibility for this certification of completion.

In the case of a super adequacy ( owner replaced old deck with a new deck, ) the answer is yes, the repair condition has been met. It has been exceeded, but met. However if borrower removed the deck, the answer is no, borrower did not meet the conditions of repairing the boards. Moreover, the house is not as it was represented in the OA ( a house with a deck .) This comes back to appraiser being vague in OA that the condition stated was "cure the defect", then appraiser sets up the slippery slope which can be avoided by competence/ describe the condition succinctly so it can be met.

 

[residentialguy]

It is up to me to determine if they did it in a satisfactory manner! To do that, you have to specify what needs to be done. In your case, replacing damaged decking boards is a no brained but in other cases I relay what the BI wants. If you don’t, you are just asking for trouble.

Way back in my early days, I was appraising a two family and one unit lacked a second egress. I made the appraisal “subject to a second egress on unit two”. When I was sent back out, I found that the owner leaned a step ladder against a window! He didn’t even nail it there. He plopped it against the house and said, “there, done”. When I reported that it was not satisfactory, I got a world of crap from the owner and even the lender for not specifying what I was requiring.

If you leave it up to someone else to determine what you are requiring, you are not only opening yourself up to headaches, you are not doing your job.

Did you miss all of my posts where I said to stop and find out what they are doing before you finish the appraisal?

 

[djd09]

What's the "minimum repair"?

Depends on local code.

"Please contact the building department/inspector for any further questions"

 

[residentialguy]

This is means appraiser did their job competently on the OA by describing the condition clearly enough for it to be met by the repair ( stating repair or replace loose boards on deck), . That means there is still a DECK, folks!

Or maybe this means the you went beyond your job as an appraiser by reporting the adverse condition and decided to play Architect. Is FNMA concerned about keeping the deck there or about getting rid of the safety hazard?

 

[residentialguy]

Depends on local code.

"Please contact the building department/inspector for any further questions"

In your local area.

 

[J Grant]

Or maybe this means the you went beyond your job as an appraiser by reporting the adverse condition and decided to play Architect. Is FNMA concerned about keeping the deck there or about getting rid of the safety hazard?

Being competent is not "playing architect". Defining a simple repair clearly enough to be credible ( repair or replace loose boards) is hardly being an architect. FNMA ( and client) is concerned about getting rid of safety hazard AND the house being what it is represented as being in the OA ( a house with a deck and valued as such )

 

[residentialguy]

FNMA ( and client) is concerned about getting rid of safety hazard and the house being what it is represented as in the OA ( a house with a deck and valued as such )

Good, we're getting somewhere.

• Their concern is the safety hazard.
• They want your original appraisal to represent the house when all is said and done.
• They don't want you to be an architect

So, why not just ask them how they want to fix the safety hazard? Obviously whatever way they decide must be done in a satisfactory workman like manner so you can stop them when they say they're going to set up a ladder for the egress. Then appraise the house to those plans so that the original appraisal represents the house when all is said and done?

Why do you keep insisting on telling them how they have to do it?

 

[TRESinc]

Why do you keep insisting on telling them how they have to do it?

because she is that good. you forget she is good enough to tell you that a house is worth $499,000 and not $500,000.

 

[J Grant]

Good, we're getting somewhere.

• Their concern is the safety hazard.

Their concern in the 1004 is having the conditions met,, it says so right on the form. The reason for conditions was to cure a safety hazard, but meeting the condition stated ( replace defective boards), is the purpose of the 1004 D inspection.

They want your original appraisal to represent the house when all is said and done.

Having the deck removed is NOT meeting terms of original appraisal ! The OA house was represnted- the house was represented, and valued, as having a deck.

• They don't want you to be an architect

They dont want you to be an idiot.

So, why not just ask them how they want to fix the safety hazard? Obviously whatever way they decide must be done in a satisfactory workman like manner so you can stop them when they say they're going to set up a ladder for the egress. Then appraise the house to those plans so that the original appraisal represents the house when all is said and done?

Why do you keep insisting on telling them how they have to do it?

Because an appraisal is not about asking the owner how they want to fix a safety hazard, we are the market experts hired by lender for our expertise, we condition the appraisal to resolve the issue in a workmanlike manner that retains integrity and value of the home. Removing the deck and stripping the house of a valued amenity was not the condition to be met ( replacing boards which retains the deck should have been the condition stated)

You state in your OP you assumed owner would replace the boards rather than remove, but you failed to disclose your own assumption as condition to be met - which started what you call a slippery slope). .This is a simple competence issue-clarify the condition ( replace boards)

If you wish to consult with owner how they wanted to do it (remove deck )and base appraisal on that, then disclose that you based repair on what owner wanted to client and value accordingly- which would mean your condition of subject to would be removal of deck and valued as a home with no deck on the OA.