FHA Septic & Well Appraiser Lawsuit

[Trihard]

The issue is not an adjustment between public or septic. The issue is the minimum property requirements on this item were not verified and it did not and can not qualify due to not having sufficient space for repair or replacement which would have also had to be verified in the well waiver, and now costs over $100,000.00 to bring up to current health and safety codes.

I understand. But this is more of an underwriting issue than an appraiser issue. The appraiser did not mention the well and septic; however, its up to the underwriter to get a water and sewer bill for FHA loans. Because of this, the FHA sends the loan back to the original lender for servicing. Meaning this turd(lol) will sit on the lenders books and not FHA.

 

[Huds_Harm]

I understand. But this is more of an underwriting issue than an appraiser issue. The appraiser did not mention the well and septic; however, its up to the underwriter to get a water and sewer bill for FHA loans. Because of this, the FHA sends the loan back to the original lender for servicing. Meaning this turd(lol) will sit on the lenders books and not FHA.

FHA told the lender since the appraiser marked it public "there was no way they could have known"
They also told the lender "no further action is needed."
Yet told me 724 days later that the lender is required to order a field review to determine property eligibility.

 

[Dublin ohio]

all 63 pages.

Appraiser Marked Private Septic And Well As Public

The appraiser on the property I purchased with an FHA loan marked my water and sewer as public therefore the required FHA tests and minimum distance requirements were not performed. The system has not only failed it will cost upwards of 60k to bring up to health and safety standards due to the...

appraisersforum.com

Hardly 63 pages of "defending" the appraiser. A lot of questions and clarifications. Not even sure of what the purpose of your original thread was. You have the HUD findings in your hand. It is up to you to decide what to do with them. Early on in your original thread. Someone suggested you get an attorney. Sounds like the same advice is prudent now. Do you know if HUD sanctioned the appraiser. If the lender is required to order a review. Who enforces those requirements?

 

[Huds_Harm]

Hardly 63 pages of "defending" the appraiser. A lot of questions and clarifications. Not even sure of what the purpose of your original thread was. You have the HUD findings in your hand. It is up to you to decide what to do with them. Early on in your original thread. Someone suggested you get an attorney. Sounds like the same advice is prudent now. Do you know if HUD sanctioned the appraiser. If the lender is required to order a review. Who enforces those requirements?

The appraiser was assigned 14 hours of CE classes on FHA minimum property requirements.
FHA told the lender since the appraiser marked it public "there was no way they could have known"
They also told the lender "no further action is needed."
Yet told me 724 days later that the lender is required to order a field review to determine property eligibility which then wouldve required the bank to mitigate meaning the $30,000.00 I've spent on an attorney and two year wait was unecessary. I'm still waiting on the lender to order a field review.

 

[Trihard]

FHA told the lender since the appraiser marked it public "there was no way they could have known"
They also told the lender "no further action is needed."
Yet told me 724 days later that the lender is required to order a field review to determine property eligibility.

Here is what FHA Handbook 4000.1 says.

"The Mortgagee must confirm that a connection is made to a public or CommunityWater System whenever feasible and available at a reasonable cost. If connectioncosts to the public or community system are not reasonable, the existing onsitesystems are acceptable, provided they are functioning properly and meet therequirements of the local health department."

Page 186.

"The Mortgagee must" Must is the keyword there.

So the lender messed that one up. Probably wanted to close fast so everyone got paid.

 

[Huds_Harm]

Here is what FHA Handbook 4000.1 says.

"The Mortgagee must confirm that a connection is made to a public or CommunityWater System whenever feasible and available at a reasonable cost. If connectioncosts to the public or community system are not reasonable, the existing onsitesystems are acceptable, provided they are functioning properly and meet therequirements of the local health department."

Page 186.

"The Mortgagee must" Must is the keyword there.

So the lender messed that one up. Probably wanted to close fast so everyone got paid.

exactly what happened, because what incentive is there to point out an error and omission that would require more tests when they can simply close the loan and if it is ever discovered it is up to the borrower to try to uphold FHA rules and regulations. If the entity that wrote the rules isn't enforcing them how does a borrower hold a bank accountable?

 

[Trihard]

exactly what happened, because what incentive is there to point out an error and omission that would require more tests when they can simply close the loan and if it is ever discovered it is up to the borrower to try to uphold FHA rules and regulations. If the entity that wrote the rules isn't enforcing them how does a borrower hold a bank accountable?

The appraiser is held accountable by the state board where they are licensed. They can also be thrown off the FHA panel. The lender on the other hand with no issues.

 

[glenn walker]

A buyer who is now wishing they had not purchased it ? A State board does not award monetary damages to a borrower and so its a Civil action where the buyer would have to sue and claim they are damaged. Fairly common but hard to collect on

 

[Huds_Harm]

A buyer who is now wishing they had not purchased it ? A State board does not award monetary damages to a borrower and so its a Civil action where the buyer would have to sue and claim they are damaged. Fairly common but hard to collect on

like I said this update is for those of you that defend this type of appraiser.

A buyer who is now wishing they had not purchased it ?

rather than a grossly negligent appraiser, gaslighting at its finest.

 

[glenn walker]

like I said this update is for those of you that defend this type of appraiser.


rather than a grossly negligent appraiser, gaslighting at its finest.

Lets assume the appraiser sucks- it doesnt change the outcome as its a done deal. So now we are entering civil law where one has to prove the damages in a court of law. The $100K seems like a high bar but you will need multipe parties named in the law suite, normally Sellers, Realtors, Appraiser, "your-self" and what due diligence did you do ? and what did you know before the purchase ?

If you were in California I could refer you to a good real estate attorney but her first step and question is how did you suffer $100K in damages ? Where it gets problematic is until one goes to sell a property its hard to measure a $$$ loss. WHAT DO YO WANT ? or is this just a rant about a "bad Appraiser and a Bad Buyer