How do you reply to these revision requests?

[glenn walker]

Well his price range was so low 90-100k so we were stuck with it, but at a SC of 30k would be pretty unusual , to come in at 299k or 298k

That said, I dont' think 96k is any more or less precise than 95k. They each are a finite numerical amount.

Though we round off for adjustments, and might round off in large value increments, in lower price ranges, each $1000 counts - and in any event, the highest sold price in his example was 96k, not 95, so the appraiser is supposed to be "that good " because 96k was the highest sold comp, so it makes more sense o reconcile at 96k than 95k since we are considering the pendings at 100k -

I will play devils advocate let's get away from the $100,000 appraisal and say it sold in a high cost area like where I live and work in. My Subject sold for $620,000 and I had not one single closed sales comparable at over $610,000 but I had two pending sales one at $620,000 and the other at $630,000. Now I appraise it for the $620,000. Three weeks later I get a letter that a GSE or HUD Post Closing Review that had revealed that Pending #1 had fallen out of escrow a week after my effective date. Now to add insult to injury Pending #2 closed at $30,000 less than what its MLS reported price showed. Suddenly I have a valuation problem on my hands. In my area we are already starting to see similar events happening. ** Another problem is Realtors when desperate have been known to start playing games and reporting bogus pending prices because they had a real sale just around the corner they need to come in at Sales price and they hope appraiser will see and use th ehigher pening..

Another Example: At some point-like what happened in 2007 in my area late in the cycle at or near a market top we may start to see appraisals coming in below both sales and Pending prices-- but we wont know it until month to three months down the road.. Suddenly the Pending Sales were no longer reliable. We tend to get used to a market only going one way if its been a trend for over a year but when it slows down or stops we rarely know it for 3 to 6 months . In 2007 out here we assumed it was seasonable and the spring pop would revive us but when spring came we didn't get the pop as game was over but we just didn't know it.
In Summary : Thread carefully and cover all your bases .

 

[Ariba]

I will play devils advocate let's get away from the $100,000 appraisal and say it sold in a high cost area like where I live and work in. My Subject sold for $620,000 and I had not one single closed sales comparable at over $610,000 but I had two pending sales one at $620,000 and the other at $630,000. Now I appraise it for the $620,000. Three weeks later I get a letter that a GSE or HUD Post Closing Review that had revealed that Pending #1 had fallen out of escrow a week after my effective date. Now to add insult to injury Pending #2 closed at $30,000 less than what its MLS reported price showed. Suddenly I have a valuation problem on my hands. In my area we are already starting to see similar events happening. ** Another problem is Realtors when desperate have been known to start playing games and reporting bogus pending prices because they had a real sale just around the corner they need to come in at Sales price and they hope appraiser will see and use th ehigher pening..

Another Example: At some point-like what happened in 2007 in my area late in the cycle at or near a market top we may start to see appraisals coming in below both sales and Pending prices-- but we wont know it until month to three months down the road.. Suddenly the Pending Sales were no longer reliable. We tend to get used to a market only going one way if its been a trend for over a year but when it slows down or stops we rarely know it for 3 to 6 months . In 2007 out here we assumed it was seasonable and the spring pop would revive us but when spring came we didn't get the pop as game was over but we just didn't know it.
In Summary : Thread carefully and cover all your bases .

Thank you for sharing.

 

[sputnam]

1-4. I suggest you read it.

As I'm sure someone already pointed out, SR 1-4 doesn't mention Realtors. It says that appraisers are to verify. It doesn't say how they are to do that.

 

[J Grant]

I will play devils advocate let's get away from the $100,000 appraisal and say it sold in a high cost area like where I live and work in. My Subject sold for $620,000 and I had not one single closed sales comparable at over $610,000 but I had two pending sales one at $620,000 and the other at $630,000. Now I appraise it for the $620,000. Three weeks later I get a letter that a GSE or HUD Post Closing Review that had revealed that Pending #1 had fallen out of escrow a week after my effective date. Now to add insult to injury Pending #2 closed at $30,000 less than what its MLS reported price showed. Suddenly I have a valuation problem on my hands. In my area we are already starting to see similar events happening. ** Another problem is Realtors when desperate have been known to start playing games and reporting bogus pending prices because they had a real sale just around the corner they need to come in at Sales price and they hope appraiser will see and use th ehigher pening..

Another Example: At some point-like what happened in 2007 in my area late in the cycle at or near a market top we may start to see appraisals coming in below both sales and Pending prices-- but we wont know it until month to three months down the road.. Suddenly the Pending Sales were no longer reliable. We tend to get used to a market only going one way if its been a trend for over a year but when it slows down or stops we rarely know it for 3 to 6 months . In 2007 out here we assumed it was seasonable and the spring pop would revive us but when spring came we didn't get the pop as game was over but we just didn't know it.
In Summary : Thread carefully and cover all your bases .

Well said.

 

[Cob]

I'm surprised that the AF hasn't recoiled in response to your comments about "rationale decisions," because you, especially as an appraiser, cannot make that call without supporting data. (IMO)

I 100% don't understand your comment, I am NOT making ANY "call" I am simply explaining what has gone on in the market that I work and am expressing an OPINION about it, so YES, me as an appraiser CAN have an opinion, in my opinion anyway. Again, I 100% do not understand your post or what you are getting at.

 

[MrLA]

Looks like you got desk reviewed. Address each issue. Learn from it and move on.

 

[MrLA]

I'm one year in to being certified here in the middle Tennessee area and I'm starting to see this more and more as lenders come into the market. I have spoken with my old supervisor about this but I'm curious what other people with years of experience comment/reply to revision requests like these:

first revision request:
Please comment on the value estimate being lower than the sale price. Please comment as to how the quality of construction adjustments were derived. Please comment as to why no adjustments were applied for differences in condition. Sales #2 & #3 were over one mile distant and located in a different town than the subject. Please provide market data which demonstrates the locations are similar to the subject with no adjustments warranted.

second revision request:
Please further discuss your analysis of the purchase agreement. Given that this represents a meeting-of-the-mind of buyer and seller for the subject's characteristics, how was this factored in the opinion of subject value. Per MLS comments multiple offers were received, please advise if the appraiser was able to confirm multiple offers 3.) please expand commentary on your reconciliation to value.

Now all of these things/adjustments are summarized in my supplemental addendum (which is almost two full pages of commentary). I have never seen such ridiculous revision requests and it seems as if they want the report to be specific as opposed to a summary report and put all legal onus on the appraiser. I replied with a polite decline and a suggestion that if these revisions were needed the fee would need to be increased and reminded them about the summary requirements of USPAP. Anyone else dealing with this bs? They also requested comps that have no quality adjustments, and it feels like they're pushing a value.

Oh and I've had multiple lenders/underwriters send me specific comps and a request to comment as to why these comps were not considered. This seems to be a violation of FIRREA to me.

I think its best to learn from multiple old-heads in the business and fight the good fight against underwriters and lenders together!

Everyone of those conditions are warranted. Live and learn. Stay professional. Fix it before it goes to the state.

 

[Michigan CG]

They teach economics in high school?

They used to.

 

[Michigan CG]

You must have a different version of USPAP. Where specifically is the reference in USPAP that the appraiser must call the real estate agents/seller/buyers to verify comparable information? My version of USPAP does not have any specific rules or standards regarding the verification process.

The MLS is a data SOURCE, not verification of a sale, the conditions of the sale, the condition of the property or other factors. The Assessor records are a data SOURCE, not verification of a sale, the conditions of the sale, the condition of the property or other factors.

Costar is a data SOURCE that is known to be wrong many times just like the MLS is known to be wrong many times. Any appraiser taking Costar information or MLS information for granted is not doing their job.

 

[Michigan CG]

As I'm sure someone already pointed out, SR 1-4 doesn't mention Realtors. It says that appraisers are to verify. It doesn't say how they are to do that.

The MLS is a data SOURCE, not verification of a sale, the conditions of the sale, the condition of the property or other factors. The Assessor records are a data SOURCE, not verification of a sale, the conditions of the sale, the condition of the property or other factors.

Costar is a data SOURCE that is known to be wrong many times just like the MLS is known to be wrong many times. Any appraiser taking Costar information or MLS information for granted is not doing their job.