1004 or 1073?

[Airstream]

Unless it's a lease hold estate, if the title anywhere says condo, you must use the condo form.

Even if they're townhomes with owned lands.

Condo is an ownership type. The language appears in legal because in addition to the individual sites, there is also commons area lands which require HOA dues and a PUD structure to maintain.

Everything with community commons elements which are private and not maintained by the city/county are probably going to be on condo form.

For appraisers the difference can be negligable. You can often successfully comp a standard townhome which you'd complete on a 1004 form, against a similar townhome which you must complete on the condo form. The form difference is due to insurability requirements and packaging loans. Because there are different legal requirements for servicing in community developments.

These are done on the 1004. And I have done these for Wells Fargo, USBank, and other banks. The only one I have come across that wants these types of properties on a 1073 is FHA. Maybe there are more, I just haven’t run across them.

And the 1073 is a terrible form for these properties (it is not negligible) that have a legal description of condominium YET they own acreage and function as a single family detached residence like any other. And I know of many SFR’s that have common elements and own common land areas that do not have condominium in their legal. They are all over the place in the county I do appraisals. Trying to use the 1073 is like fitting a square peg through a round hole.

 

[Airstream]

The GSE's will allow site condos and HPS properties to be reported on the 1004. IMO, however, this is inappropriate, as there is no site 'under the house'. All property types where ownership of the land is held in common, IMO, should be reported on the 1073 (assuming the intended use is for mortgage lending purposes, that is).

Yes there is a site under the house. I just did one that owns a 2.9 acre site. Every single property in the complex owns a site with specific dimensions. And those sites in the past sold just like vacant land sites with specific dimensions and acreage.

 

[Airstream]

Sounds like a leasehold estate. Those do go on the 1004, even if they're modulars and not stick or manufactured.

No, not a leasehold estate. From the responses in this thread it seems like people are not understanding what I am talking about. These properties have specific sites owned in fee simple. If they had no improvements they would still own the site with acreage just like any other vacant land sites. They are NOT leasehold estates.

 

[Cob]

Hello,

I received a request to appraise this property. The lender ordered a 1004, however after reading the legal description I wasn't so sure. Any recommendations? Thank you, Jon

VILLAGIO AT HAPPY VALLEY CONDOMINIUM MCR 915-34 UNIT 102 (PLEASE NOTE: FOR LEGAL DESCRIPTION REFERENCES REGARDING THE PERCENTAGE OF OWNERSHIP OF THE COMMON AREA(S) PLEASE REFER TO THE RECORDED COVENANTS, CONDITIONS AND RESTRICTIONS (CCR) ASSOCIATED WITH THIS PLAT.)

If the property is a Condo that is detached and is located in a community that feature the same type of properties, the appraiser can complete the appraisal report on a 1004 or 1073, I always explain this to the client/lender and have them decide which they prefer.

 

[GWISC]

If it is a site condo, but where the site has a defined size and the condo unit sites are sold for varying prices depending on size, then I generally report on the 1004. Mostly, because cost approach will apply (especially if it is new or newer construction). There is no cost approach on the condo form and I am not going to work up a cost approach in the narrative addendum. I explain, in the narrative, the property is a site condo with ownership to the site (The one development we have explains the ownership of the land in detail in the condo decs which I copy into my report and highlight for the underwriter). Anyway, my decision maker is if the cost approach applies, then 1004.

 

[Cob]

From Fannie Mae Selling Guide, regarding using for 1004.

"In addition, appraisals for units in condo projects that consist solely of detached dwellings may be documented on Form 1004, if the appraiser includes an adequate description of the project and information about the homeowners’ association fees and the quality of the project maintenance. Appraisals reported on Form 1004 must be completed in accordance with the UAD Specification."

 

[Zoe]

I charge more for 1073 because you have to do more work especially contacting HOA to verify owner occupancy.
Some lazy appraisers just take photo of the condo building which I do but I look at each condo comp location and adjust.

My client don't pay anymore. I understand your position. I always use the 1073 on a condo for lending purposes. Some clients will accept the 1004 on a condo.

I just don't do it. I give them what I give them.

I set the SOW Sir Fernando.

Can I borrow that Tesla sometime? You never would forgive me if I wrecked it. You could take me and Ms. for a ride in it. I'll buy you lunch.

 

[Tom D]

Long ago when condos were invented there was a lot of confusion about them, and the early ones weren't exactly figured out . It almost sounds like you have a pud. Without a picture for us to look at it, who can really say. The 1004 does allow a pud on it.

 

[Fernando]

My client don't pay anymore. I understand your position. I always use the 1073 on a condo for lending purposes. Some clients will accept the 1004 on a condo.

I just don't do it. I give them what I give them.

I set the SOW Sir Fernando.

Can I borrow that Tesla sometime? You never would forgive me if I wrecked it. You could take me and Ms. for a ride in it. I'll buy you lunch.

No, you may not borrow it. Cost to repair is way too high. I already got a small dent on the driver's door first week I got the car (I lied to my wife that a tree branch dented it). And last month, in the gym's garage, the automatic trunk went up and hit the low ceiling pipe. Ugh.

And yes, client wants same fee for 1073 and 1004. I ask more for 1073 and usually don't get the order. Must be another appraiser willing to take same fee as 1004.

 

[Dublin ohio]

From Fannie Mae Selling Guide, regarding using for 1004.

"In addition, appraisals for units in condo projects that consist solely of detached dwellings may be documented on Form 1004, if the appraiser includes an adequate description of the project and information about the homeowners’ association fees and the quality of the project maintenance. Appraisals reported on Form 1004 must be completed in accordance with the UAD Specification."

There are detached condos in my area that do not have a separate site. Just like attached units the only "site" they have is the footprint of the building. Everything outside of the building footprint is common area.