Does a Comp Have to Go Through the MLS to Be a Valid Comp?

[Mark K]

Glad I'm in disclosure state CA.

We're all glad you're there too.

In this area nearly all land sales over 20 ac. are via auctions. Those comps are just as valid as the monopolistic MLS.

 

[Surf Cat]

Fannie Mae Selling Guide explicitly states that if data is provided by a party with a financial interest, it must be verified through a disinterested source. This is what I've always gone by.

Ensuring that the data is accurate and that the circumstances of the sale, including financing concessions and whether it was an arms-length transaction, are properly conveyed. Sometimes that takes banging on the keyboard in an email or an old school phone call.

 

[alebrewer]

Fannie Mae Selling Guide explicitly states that if data is provided by a party with a financial interest, it must be verified through a disinterested source. This is what I've always gone by.

Ensuring that the data is accurate and that the circumstances of the sale, including financing concessions and whether it was an arms-length transaction, are properly conveyed. Sometimes that takes banging on the keyboard in an email or an old school phone call.

In Texas, the only way to verify an MLS sales price - is with the agent who put the information there in the first place - as Title companies aren't allowed to divulge any information. Somehow we make it work.

 

[Surf Cat]

My faith in humanity is often restored when I get an experienced, knowledgeable realtor on the phone who's not only willing to talk about the particular sale in question, but what I'm working on. I mean, they've personaly been in all sales. I appreciate their two cents and opinion.

 

[Fernando]

In Texas, the only way to verify an MLS sales price - is with the agent who put the information there in the first place - as Title companies aren't allowed to divulge any information. Somehow we make it work.

Before when I was too lazy to go to the courthouse, I would call the title company nicely, and able to verify the sale.
Glad CA is the Great Sate to get verification.

 

[alebrewer]

Before when I was too lazy to go to the courthouse, I would call the title company nicely, and able to verify the sale.

As California is a disclosure state, I'm sure they were happy to accommodate those requests.

 

[Fernando]

As California is a disclosure state, I'm sure they were happy to accommodate those requests.

Have to use Fernando charm.
Title companies from comps have no obligation to give me an answer.

 

[Terrel L. Shields]

(looking at you Globe), and even then, they are such small towns with their particular agents that it's usually not that hard to call one up

I liked Globe...

There must be way of verifying sales in wild west Texas.

Begging an agent maybe.

In OK and AR, I find the same on a compiled source that provides assessor records. Once I locate these sales, I confirm with Googling the address - if in my MLS, I can search there too. But if in Tulsa or perhaps the River Valley MLS (Ft. Smith) Zillow often gives me the info I need and even the MLS number. Once I find that and I have the buyer and seller name, I have a website I can look up the deed and the mortgage. The mortgage will normally give me the type financing and terms and often you might even find a second mortgage related to the transaction where the seller is carrying 10-20% of the sale. At the bottom of the page, a mortgage will ID the type loan (FNMA, FHA, or if none it is non-conforming loan.) Check for the box saying there is an VA rider. If you think there is something else you need, Zillow gives the selling agent's name usually. Call 'em.

 

[Tom4value]

Way back when I first stared out and took my primary classes, the proctors always said that only about 80% of all sales go through the MLS. I bet that percentage is even lower now with Zillow and all the other alternative platforms. To say that USPAP requires MLS was what blew bull crap horn for me. USPAP makes no mention of the MLS or any other platform. Any sale that YOU can find and validate was arms length can be used.

Now, there is a difference between a valid sale and a good comp. The key is to determine the strength and weaknesses of the comps you use and reconcile them. You can have a sale of a twin of the subject property but you find that is was a FISBO or came from a realtor’s database and was not exposed to the open market. Toss it? Not necessarily. Just needs to be considered in the reconciliation. Maybe it turns out to be your most reliable comp and you weight it most. Maybe after adjustments it is out of whack with the other comparables and you weight it least. Bottom line is don’t toss anything out until you look at it.

 

[George Hatch]

When I first started appraising I knocked on doors to personally confirm sales. I only do that rarely now.