1004D and Foundation Certificate

[alebrewer]

This is from the Fannie Selling Guide:
"If the appraiser is not qualified to evaluate the alterations or repairs, the appraisal must note the deficiencies and be completed "subject to" a satisfactory inspection by a qualified professional. The lender must decide if the inspection(s) is required and whether the property meets eligibility requirements. If the property does not meet eligibility requirements, the lender must provide satisfactory evidence that the condition has been corrected or repaired prior to loan delivery. In this case, the appraiser is not required to review the professionally prepared report, re-inspect the property, or provide a Form 1004D. The lender must document the decision and rationale in the loan file. See B4-1.4-08, Environmental Hazards Appraisal Requirements, for properties affected by environmental hazards." (highlight added by me)

 

[Tom D]

i might go against the tide here. but it seems confusing as to what you exactly wrote. you asked for what kind of foundation repairs, be specific. exactly what did you see to make you nervous.
but then the lender, maybe concerned about you lack of structural engineering knowledge then asks you to revise subject to struct cert. so you changed it subject to a struc cert. now the struc cert states "generally structurally sound." but might need some more piers, but not saying it needs it today, or else it fall down.
you got what you revised for, a cert saying it ain't going to fall down. now that being said, the underwriter can accept that cert without your 1004d. but my opinion is, you got what you asked for, did you take out the repairs when you revised it. maybe you have a degree in structural items, but except for the obvious problem, no one here would do what you did in the original report. but i'm only guessing cause i ain't seen what you seen.
maybe some here have a better crystal ball than i do, mine is a little foggy on the facts.

 

[CGinMN]

Revise your report and make it subject to a third party inspection by a licensed structural engineer. The lender can then make the decision.

 

[sputnam]

My approach is to report what I observe. If you've conditioned the appraisal on foundation repairs, and you observe that the repairs are not complete, that is what you report. Keep in mind though, that no used house (and probably no new house) is perfect. You can't certify that the repairs are done but.... you can indicate that based on the engineer's report, the dwelling is habitable. Will that have an impact on your opinion of value?

 

[J Grant]

My approach is to report what I observe. If you've conditioned the appraisal on foundation repairs, and you observe that the repairs are not complete, that is what you report. Keep in mind though, that no used house (and probably no new house) is perfect. You can't certify that the repairs are done but.... you can indicate that based on the engineer's report, the dwelling is habitable. Will that have an impact on your opinion of value?

A house can be habitable (livable and being lived in ) yet have foundation problems. The condo building in Miami that collapsed in Surfside a few years ago was habitable until the darn thing literally collapsed.

Idk what is going on with the subject - but IMO the appraisers should not make opinion statements like it is habitable ( or not), they should just state verbatim what the foundation report said -or better yet, attach it, and say "see attached foundation report." That way the appraiser is not liable for any opinions about the foundation. (IMO)

 

[J Grant]

I'm being asked to complete a 1004D for a property that I inspected that needs foundation repairs. According to the foundation report, which was completed after my report, it states the it is "...generally structurally sound.", then goes on to state that 20 piers are recommended. I made my report "Subject To" Foundation Repairs, they asked for it to be "Subject To" a Foundation Certificate in a revision, so I changed it. The repairs have not been completed and they are asking me to complete the 1004D based on "...generally structurally sound." My gut says NO because the report states "Subject To" a Foundation Certificate, which we all know will not be provided until the work has been finished.

I did contact the Engineering Firm that wrote the report to get clarification on the statement "...generally structurally sound.", they basically said it means the property is habitable but there is some work needed, otherwise they would not have recommended the piers.

Is my thought process wrong when I keep telling them I will not provide the 1004D without the Foundation Certificate?

What repairs are needed?

Are the repairs you claim needed to be done based on something you observed but that the foundation report is not requiring?
I dont' know anything more about foundations than very basics so Idk why the inspector recommended 20 piers, or what is going on there...but if the appraisal was made subject to a foundation certificate , (or can be revised to that ) , then attach it, say the certificate was completed, ( say see attached ) and be done.

 

[Surf Cat]

I would do what Cob in post #7 and sputnam #14 are suggesting. But here's the thing, and sputnam pointed it out.

If your "opinion of value" is based on comparables with sound foundations, not needing repair....this needs to be addressed. An across the board, cost to cure, with a 10 to 20% entrepreneur incentive added (negative adjustment) needs to be inputted in the report. Hopefully, the recommendation for the 20 piers came with that cost.

"Then" they get their 1004D with the foundation report attached marked "no" the repairs have not been complete.

If you give them the 1004D checked no, with the foundation report attached, unless you have a comp or two that sold with foundation repairs needed, your opinion of value is skewed.

 

[Raven59]

I'm being asked to complete a 1004D for a property that I inspected that needs foundation repairs. According to the foundation report, which was completed after my report, it states the it is "...generally structurally sound.", then goes on to state that 20 piers are recommended. I made my report "Subject To" Foundation Repairs, they asked for it to be "Subject To" a Foundation Certificate in a revision, so I changed it. The repairs have not been completed and they are asking me to complete the 1004D based on "...generally structurally sound." My gut says NO because the report states "Subject To" a Foundation Certificate, which we all know will not be provided until the work has been finished.

I did contact the Engineering Firm that wrote the report to get clarification on the statement "...generally structurally sound.", they basically said it means the property is habitable but there is some work needed, otherwise they would not have recommended the piers.

Is my thought process wrong when I keep telling them I will not provide the 1004D without the Foundation Certificate?

I would not touch this in any way. You are not qualified to comment. If you do the 1004D as requested, you will be an attorney's dream. Make sure your E&O is up to date. Don't be a fool. RUN!

 

[J Grant]

I would do what Cob in post #7 and sputnam #14 are suggesting. But here's the thing, and sputnam pointed it out.

If your "opinion of value" is based on comparables with sound foundations, not needing repair....this needs to be addressed. An across the board, cost to cure, with a 10 to 20% entrepreneur incentive added (negative adjustment) needs to be inputted in the report. Hopefully, the recommendation for the 20 piers came with that cost.

"Then" they get their 1004D with the foundation report attached marked "no" the repairs have not been complete.

If you give them the 1004D checked no, with the foundation report attached, unless you have a comp or two that sold with foundation repairs needed, your opinion of value is skewed.

The OP did not ask about his opinion of value nor the comps - it just confused things even more if we volunteer ideas about that- we do not know if the comps were adjusted for it or not -

The OP asked about the 1004 D as a stand-alone - which is getting mixed responses- as one would expect, since over teh internet we don't; see the property or know what the repairs are-

 

[Surf Cat]

The OP did not ask about his opinion of value nor the comps - it just confused things even more if we volunteer ideas about that- we do not know if the comps were adjusted for it or not -

The OP asked about the 1004 D as a stand-alone - which is getting mixed responses- as one would expect, since over teh internet we don't; see the property or know what the repairs are-

You may be right in regards to the value. We don't know what she did. Having said that, let's use common sense here. She initially made the report "subject to foundation repairs" which would lead one to believe that typical comparables from the immediate neighborhood were utilized. I mean, really.... how many homes sell with foundation problems? I'd wager that none are in the report.

However, here's where the wheels came off the wagon. They asked her to make the report subject to a foundation certificate. In viewing the certificate, it is now known that "it does" need repair as she initially noted.

It is my opinion that the value here, is of "huge concern" ON TOP of the 1004D issue. Confusing or not, if the op is not thinking of the value, especially if this report is now going to be "as is" with a certificate, she'd better be...

P.S. I keep referring to Andee as a she. If I misgendered, my apologies. I don't want to offend anybody.