1.5 Story No Permits Second Level

[wyecoyote]

Ok interesting one for you all what do you think?

Got the assignment from client (local bank) homeowners are hispanic and do not speak english. The homeowners purchased house 5 years ago so no MLS information on sale. County Records indicates that the subject is 1 story house 2 bedrooms and 1 bath and built in 1920's. Due to language barrier get the appointment from the LO who does speak spanish. Go out to property to due inspection the house is actually 1.5 story with 2 bedrooms and bath on first level and 1 bedroom and open area on the second level. The house was partially updated in the late 80's to early 90's (kitchen, bathroom, floor covering in kitchen, bath, utility, the downstairs bedrooms, and the second level). The stairwell up to the second level appears to be well worn (hardwood) and possibly from the time built to the late 40's due to rise and run of stairs and plaster walls. Per the homeowner, (as enterpreted SP by the loan officer) the second level was there when they bought the house. Check the county for permits open permits go back 10 years none for the second level. The other permits available go back 30 years and require hard search of all permits year by year.

Talk to the building and planning department to find out what I can (no I don't give them address). As they state without permits for the building the second level does not exist in their eyes. For the city to sign off on the second level then an inspector would have to go out to the property and determine when the second level was constructred. If the second level was constructed after the current owners bought then they would have to pay for the permits and any penalties. However, if the second level was constructed prior to the homeowners owning the property but within the past 30 years then they would have to pay for permits from the time frame of construction but would not have to pay any penalties. The City and County would then put on the title that the house could not be sold until the applicable permits were paid. Third senario if the second level was determined to be finished over 30's years ago then there would be not required permits to be paid and it would be signed off by the building and planning and determinded to be grand fathered since permits beyond 30 years are to inconsistent and not available.

My first consideration was make it subject to an inspection and findings by the city building and planning and signing off by them. So I talk to the client about the situation and they say just do "as is" with my own discretion on how to value the subject as 1 story or as a 1.5 story. If their underwriting determine that they want to require inspections then it is up to them. Provided after 2 days of calling back and forth and talking to UW and bank managers.

So with this request I have determined that there is several ways I could consider this. 1. Hypothetical condition that the second level is permitted. 2. Extra ordinary assumption that it would be considered grandfathered due to stairwell access and plaster walls. 3. Give no value to the second level and state in the report no value given due to no permits found at the building and planning department.

So what are your thoughts on this issue any other way of determing this?

Ryan

 

[Mountain Man]

Since it was reported to you that the addition existed before the current owners, and the city stated:

if the second level was constructed prior to the homeowners owning the property but within the past 30 years then they would have to pay for permits from the time frame of construction but would not have to pay any penalties.

I'd lean towards option 1. Hypothetical assumption that a back-permit will be issued, and let the UW worry about it.

 

[Patti Jury]

Ryan,

I hope this helps..We have an area in town that consists of turn of the century homes. Public Records shows the majority of them as being ranchers or 1.5 stories, however there is no square footage information given for the upper level. Often times when you arrive at the subject.. it turns out to be a very large 2 story home. The upper level was never recorded. So I have to make that statement in the report regarding incorrect Public Records info.

If I were you.. I would explain the potential for permits, or the grandfather situation... and everything you have stated here. Also state all adverse conditions noted, deferred maintenance..etc.. and value it "as is". You have therefore completed the appraisal as requested, and covered you backside.. Than run like the wind! :rofl: