Double dipping?

[Jonedwmor]

Looking to get some incite here. Myself and lender are both looking at this appraisal and it’s coming in 15-20% lower than what we’re thinking.

The subject property is on slab, all new everything and updated to what should be a Q2 for the area. Appraiser keeps using mix of properties slab and basement. But mostly basement even after sending them comps of basementless properties of similar footprint. Here’s where we pushed back to AMC that didn’t make sense.

At the beginning of the report. He states he’s doing a Q4 do to being no basement. Which is a 10%-20% ding.

Then for each comp of the properties that have basements. He adjusted a separate 10k off for basements against subject property.

We sent this back to AMC and they’re not moving either. Just trying to make this make sense when it seems like it’s getting dinged twice for the same thing.
Something were missing?

 

[sputnam]

IMO, the Q codes have nothing to do with whether a dwelling has a basement or not. You can build a high quality house on a slab or a crawl space. You can also build a lower qualith dwelling over a basement. I don't know anything about what comparables the appraiser chose or why... or about the comparables you think are better or why. I know that to the maximum extent possible, subject to comparable comparisons should be apples to apples. A lot of times those sorts of highly similar sales don't exist. Take a look at the order of adjustment on the Sales Comparison Grid. The adjustments are prioritized by the creators of the form... Fannie Mae and Freddie Mac. The adjustments considered most important are at the top.

The Lender has some relationship and maybe influence with the AMC. You don't. The Lender may be able to get a Reconsideration of Value. If so, it's still going to be the opinion of the same appraiser. The Lender may be able to order a field review. If so, and it's a good reviewer, you will get another appraiser's opinion about the adequacy of the comparables and the value of the property. Even better, the Lender may be able to order an audit appraisal... a 2nd appraisal by a different appraiser who knows nothing about what the 1st appraiser did. The only other practical alternatives are to move forward with your transaction at the value you have... or to forget the whole thing and try again with a different Lender.

 

[Jonedwmor]

IMO, the Q codes have nothing to do with whether a dwelling has a basement or not. You can build a high quality house on a slab or a crawl space. You can also build a lower qualith dwelling over a basement. I don't know anything about what comparables the appraiser chose or why... or about the comparables you think are better or why. I know that to the maximum extent possible, subject to comparable comparisons should be apples to apples. A lot of times those sorts of highly similar sales don't exist. Take a look at the order of adjustment on the Sales Comparison Grid. The adjustments are prioritized by the creators of the form... Fannie Mae and Freddie Mac. The adjustments considered most important are at the top.

The Lender has some relationship and maybe influence with the AMC. You don't. The Lender may be able to get a Reconsideration of Value. If so, it's still going to be the opinion of the same appraiser. The Lender may be able to order a field review. If so, and it's a good reviewer, you will get another appraiser's opinion about the adequacy of the comparables and the value of the property. Even better, the Lender may be able to order an audit appraisal... a 2nd appraisal by a different appraiser who knows nothing about what the 1st appraiser did. The only other practical alternatives are to move forward with your transaction at the value you have... or to forget the whole thing and try again with a different Lender.

Your first sentence answers my question or thought process. Why would they base a Q code for basements. When there is box for basements specifically.

 

[shrubberyvaluation]

If the appraiser adjusted for quality solely on the basis of not having a basement this is wrong.

This should be adjusted on the basement line, and has nothing to do with quality.

Quality is the worksmanship and the quality of the materials used.

 

[Bob Ipock]

Are you the borrower, listing agent or selling agent?

 

[Dublin ohio]

IMO, the Q codes have nothing to do with whether a dwelling has a basement or not. You can build a high quality house on a slab or a crawl space. You can also build a lower qualith dwelling over a basement. I don't know anything about what comparables the appraiser chose or why... or about the comparables you think are better or why. I know that to the maximum extent possible, subject to comparable comparisons should be apples to apples. A lot of times those sorts of highly similar sales don't exist. Take a look at the order of adjustment on the Sales Comparison Grid. The adjustments are prioritized by the creators of the form... Fannie Mae and Freddie Mac. The adjustments considered most important are at the top.

The Lender has some relationship and maybe influence with the AMC. You don't. The Lender may be able to get a Reconsideration of Value. If so, it's still going to be the opinion of the same appraiser. The Lender may be able to order a field review. If so, and it's a good reviewer, you will get another appraiser's opinion about the adequacy of the comparables and the value of the property. Even better, the Lender may be able to order an audit appraisal... a 2nd appraisal by a different appraiser who knows nothing about what the 1st appraiser did. The only other practical alternatives are to move forward with your transaction at the value you have... or to forget the whole thing and try again with a different Lender.

Seems to me it has little to do with the adequacy of the comparables as opposed to the fact that they made a Q adjustment for the basements and also made a basement adjustment. Thus the double dipping.

 

[JTip]

The subject property is on slab, all new everything and updated to what should be a Q2

data on Uniform Appraisal Dataset (UAD) distributions shows that nearly 97% of all properties are scored as either Q3 or Q4. This indicates that Q2 properties—along with the even rarer Q1 (Exceptional Quality) tier—make up a very small fraction (likely less than 3%)

Just because its "all new" and "updated" doesn't make it a Q2. I have seen one Q2 property in my market in 15 years.

 

[Digger88]

Are there condition (C) adjustments for your home being a remodel? A Q rating can be for anything really if he specifically mentions the Q is for the basement that's a new one. Is your home all vinyl and do some/any comps have brick or stone which may have warranted a Q rating? Go on Zillow and look at interior pics of the comps that were used and compare how they stack up to yours. If there is no condition rating for your remodel you can request a reconsideration of value and mention similarly remodeled homes for comps.

 

[Surf Cat]

Appraiser keeps using mix of properties slab and basement.

Sounds as if this has been going on for awhile. I'm assuming an ROV
(reconsideration of value) has been issued to the appraiser along with competitive sales to the subject property, yes? Typically, you get one shot at this. What did the appraiser state replying to the alternate sales you provided to them?

You can request that the lender assign another appraiser or you may have to switch lenders all together.

The subject property is on slab, all new everything and updated to what should be a Q2 for the area. Appraiser keeps using mix of properties slab and basement.

All new everything is kind of vague. Every comparable sale utilize by the appraiser should be somewhat similar to yours. There may be no recent, upgraded/remodeled sales available. This may be why the appraiser utilized sales with basements as they were remodeled. The appraiser should have went further back in time or expanded the parameters of distance to find upgraded sales on slab for the report.

At the beginning of the report. He states he’s doing a Q4 do to being no basement. Which is a 10%-20% ding.

This makes no sense at all. The Quality rating is for the property in its entirety.

Unfortunately, this is what you get with the AMC system. They don't look for the most competent, geographically located appraiser. They look for the cheapest appraiser to maximize profits.

One more item.....

Myself and lender are both looking at this appraisal and it’s coming in 15-20% lower than what we’re thinking.

How do you and the lender know this but not the appraiser?

 

[Jonedwmor]

data on Uniform Appraisal Dataset (UAD) distributions shows that nearly 97% of all properties are scored as either Q3 or Q4. This indicates that Q2 properties—along with the even rarer Q1 (Exceptional Quality) tier—make up a very small fraction (likely less than 3%)

Just because its "all new" and "updated" doesn't make it a Q2. I have seen one Q2 property in my market in 15 years.

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I 100% agree with this. I'm wondering if this may be a region/city specific thing, as far as this one goes. All like properties are within 2-4 years of each other 1950's builds.

When I read Q1-Q5 I'm on your side that all of these shouldve been Q4 maybeeee Q3 on one or two. But they're all midwest 1950's small town types comps.

So I'm just trying to make sense of where this guys head is at.
Maybe he's just taking a year group/like kind properties and starting them all at Q2 for a baseline and going from there? But it doesn't make sense to flat out Q4 something just because it's missing a basement and explicitly stating as such. Especially since there is a box for that specifically.