Confusion with Exterior Only Appraisals....

[TerryRohrer]

Thanks for this Terry. It was very informative!

But on this statement... I have questions.

If the agreed upon scope of work does not conform to FNMA guidelines, wouldn't it be more appropriate NOT to use the FNMA form? That way you're not signing pre-printed certifications that don't apply and could potentially mis-lead the client?

I can't disagree with your logic, but the fact that you and I are purely logical doesn't extend that valuable trait to our clientele! I used to chaff and fight the battle you are proposing, but it doesn't pay well, so I no longer participate. It is difficult enough to get them to accept an honest opinion of value, let alone fix the system from our lowly post!

 

[PrincessLeia]

Yeah, you can. When complete, print to .pdf and then use the editing feature. Very easy. Then send it to the client.

I've done it dozens of times.

Hmmm... but that only works if you're only uploading the .pdf, not the .xml. If you're uploading the .pdf only, they may let you get away with a GP form anyway... Doesn't work if the client only wants the .xml.

 

[PrincessLeia]

I can't disagree with your logic, but the fact that you and I are purely logical doesn't extend that valuable trait to our clientele! I used to chaff and fight the battle you are proposing, but it doesn't pay well, so I no longer participate. It is difficult enough to get them to accept an honest opinion of value, let alone fix the system from our lowly post!

I can't disagree with that either. Sometimes, I wish I weren't so ethical. It doesn't pay well sometimes. But, I just can't let go so easily.

 

[J Grant]

Uniform Residential Appraisal Report This report form is designed to report an appraisal of a one-unit property or a one-unit property with an accessory unit; including a unit in a planned unit development (PUD), based on an interior and exterior inspection of the subject property. This report form is not designed to report an appraisal of a manufactured home or a unit in a condominium or cooperative project. Use This report form is designed to report an appraisal of a one-unit property or a one-unit property with an accessory unit; including a unit in a planned unit development (PUD), based on an interior and exterior inspection of the subject property. This report form is not designed to report an appraisal of a manufactured home or a unit in a condominium or cooperative project. Modifications, Additions, or Deletions

This appraisal report is subject to the scope of work, intended use, intended user, definition of market value, statement of assumptions and limiting conditions, and certifications contained in the report form. Modifications, additions, or deletions to the intended use, intended user, definition of market value, or assumptions and limiting conditions are not permitted. The appraiser may expand the scope of work to include any additional research or analysis necessary based on the complexity of this appraisal assignment. Modifications or deletions to the certifications are also not permitted. However, additional certifications that do not constitute material alterations to this appraisal report, such as those required by law or those related to the appraiser's continuing education or membership in an appraisal organization are permitted.

 

[glenn walker]

Seems fairly straight forward to me why fight a form LOL

 

[PrincessLeia]

Uniform Residential Appraisal Report This report form is designed to report an appraisal of a one-unit property or a one-unit property with an accessory unit; including a unit in a planned unit development (PUD), based on an interior and exterior inspection of the subject property. This report form is not designed to report an appraisal of a manufactured home or a unit in a condominium or cooperative project. Use This report form is designed to report an appraisal of a one-unit property or a one-unit property with an accessory unit; including a unit in a planned unit development (PUD), based on an interior and exterior inspection of the subject property. This report form is not designed to report an appraisal of a manufactured home or a unit in a condominium or cooperative project. Modifications, Additions, or Deletions

This appraisal report is subject to the scope of work, intended use, intended user, definition of market value, statement of assumptions and limiting conditions, and certifications contained in the report form. Modifications, additions, or deletions to the intended use, intended user, definition of market value, or assumptions and limiting conditions are not permitted. The appraiser may expand the scope of work to include any additional research or analysis necessary based on the complexity of this appraisal assignment. Modifications or deletions to the certifications are also not permitted. However, additional certifications that do not constitute material alterations to this appraisal report, such as those required by law or those related to the appraiser's continuing education or membership in an appraisal organization are permitted.

Thank you for that. It's perfect.

 

[sputnam]

USPAP also requires that you state all assumptions and limiting conditions you relied on. How do you "indicate the probability it is in Average (or other) condition" without seeing it? You make assumptions, and those you are claiming are doing it wrong state those assumptions to the reader understands them. They don't mislead by hiding them in an unsupported "probability" statement.

That's right. Failure to comply with SR 2-2(a)(xiii) and 2-2(b)(xv) are among the most common errors that require revision requests.

 

[J Grant]

USPAP also requires that you state all assumptions and limiting conditions you relied on. How do you "indicate the probability it is in Average (or other) condition" without seeing it? You make assumptions, and those you are claiming are doing it wrong state those assumptions to the reader understands them. They don't mislead by hiding them in an unsupported "probability" statement.

In a URAR form, those assumptions and limiting conditions are pre printed/stated on the form itself. The appraiser certifies they relied on the printed assumptions with their signature. That is what some who do little,/ no mortgage work fail to understand. The URAR form is not "just a form". The form imposes certain assignment conditions. Such as we can not add an extraordinary assumption outside the HC or EA of as is or subject to check boxes.. So if an appraiser modifies the form by modifying it or adding an EA, they have violated assignment conditions

If we find an assignment condition unacceptable, turn down the assignment. Typically, a lender who orders on a URAR form will not accept appraiser using a GP form instead. But ask anyway, if anyone wants . Verbiage about probability was a suggestion responding to another poster.

We don't see the interior, regardless of verbiage or assumptions. That is an inherent risk with ext or desktop assignments. Most of which I turn down for that reason. However, some choose to do these assignments. Imo, there is less risk with a REO use or pre foreclosure use than for an origination loan. It is a business decision for each appraiser to make

 

[Tom D]

I never understood the point of a pre-foreclosure appraisal. If the borrower is not paying, why does it matter what the collateral is worth at that point in the decision on whether to foreclose or not. guess if

they need it for their book keeping, as to whether it is a losing hold, or still good. i have done hundreds of pre foreclosures, as many as 3-4 over the years on the same house. the extraordinary assumption statement is sufficient to saying it all. you then can check the as is box. you use the generic 1055 form. no matter what, your guess is better than no guess. it's done for the service company's book keeping. as stated by my client the appraisal is not for lending purposes, but for internal use. some of you people don't know what goes on after the loan is closed. if you have no info i certainly wouldn't assume the high end of the range. most pre foreclosure are going to need work. if you haven't bought any then i guess your experience is limited. assume, if the outside has issues, the inside is probable the same. always assume it's in average, or average minus condition, if you don't know.

 

[Zoe]

Intended use and user is paramount to the question. Several have agreed in this thread. The best way to determine intended use and user is by communication with the client. Then make it clear in the report whom or what the intended use and users are.

Foreclosure is a different animal if you can't get interior access. If it is occupied according to lender, you can't even legally walk around the house and measure. You can knock on the door and take pictures and leave. You have to report whether the subject has a front door or not. Whether the property is secure or not according to observation.

Intended use and user are similar to H&B use analysis with me. The more specific the appraiser can be, the better off the appraiser is in the long run.