1004D Form, Appraisal Update

[The Warrior Monk]

Ditto Mike.

There is a lot of unnecessary confusion on the 1004D. The 1004D is simply another type of appraisal. Furthermore, it is a Summary Appraisal Report, and will require additional addenda to comply with summary appraisal report requirements.

Here is Fannie Mae's definition of the scope of work for this update.

Scope of Work for an Appraisal Update

The appraiser must, at a minimum:

1. concur with the original appraisal,
2. perform an exterior inspection of the subject property from at least the street, and
3. research, verify, and analyze current market data in order to determine if the property has declined in value since the effective date of the original appraisal.

Concurring with the original is by definition an appraisal.

Am I missing something or are the lenders finding a new/cheaper way of getting a new value on these properties? I have never mentioned a new value on an appraisal update... am I wrong here? I have to make a rebuttal as son as I can. HELP! m2:

If you concurred with the original value, said the value was less than/greater than the value in a prior appraisal, etc., you performed an appraisal.

The fee charged for an assignment is a business decision.

 

[Scott R Marshall]

Thanks Mike. I was mistaken. I went back in my archives and found the 1 appraisal update I've performed ever. I generally try to steer clear of the "update" section of the form exactly for the reasons you mention, as it is a new appraisal assignment for all intents and purposes. In my instance, I provided them a list of all comparable sales which had taken place since the time elapsed between the effective date of the "update", gridded 3 of them, and did summarize why I believed the market had not declined in value based on that data.

This is why this forum is invaluable and why I should have read the form itself before answering. Circumstances and situations arise which are infrequent at best and sometimes we forget what we originally did correctly.

 

[dane84094]

My people have yet to get back to me. I can see them sitting at their desks scratching their heads wondering what to do now that the appraiser did NOT just agree to "check the box". I think the 1004 form as an "appraisal update" should be "retired" and if the UW and all involved can't get a file processed in a reasonable amount of time (4 months in this case) then of course they should order a new appraisal instead of trying to take the short and cheap route.

I agree with you totally and couldn't have said it better myself!

 

[CANative]

Sheesh. It seems like 2002 all over again.

Update = new assignment. New effective date.

 

[SutnNC]

Side note- don't forget to disclose that you have performed appraisal services on "xyz property" within the prior three years (yes, even for a 1004D update for the same client).

Seemed obvious after we tossed some things around at one of our local meetings ("a" duh, lol moment).

 

[Mike Kennedy]

You're very welcome Scott. Merry Christmas.

 

[Terrel L. Shields]

don't forget to disclose that you have performed appraisal services on "xyz property"

Welcome to the Department of Redundancy Department

 

[SutnNC]

That was an actual "laugh out load" moment, thanks.

 

[TX ladybug]

I have been asked by one of my clients why I didn't provide a value on an appraisal update as I had stated on the update that the subject was in a declining market. I did the appraisal in May 2011. They want to know a new value. I told them to order a new appraisal. A second client just asked the same thing on an appraisal I did at the end of September.

Here is Fannie Mae's definition of the scope of work for this update.

Scope of Work for an Appraisal Upd The appraiser must, at a minimum:

1. concur with the original appraisal,
2. perform an exterior inspection of the subject property from at least the street, and
3. research, verify, and analyze current market data in order to determine if the property has declined in value since the effective date of the original appraisal.

Am I missing something or are the lenders finding a new/cheaper way of getting a new value on these properties? I have never mentioned a new value on an appraisal update... am I wrong here? I have to make a rebuttal as son as I can. HELP! m2:

The appraisal update or 1004D has 2 purposes and one of them is not to provide a new opinion of value. It is to concur or not with the original appraisals market value, if you do not concur and you check off Yes that is has declined the lender should order a new appraisal. There is no box to indicate a new value as this form is not for that purpose. Dont forget to do your exterior inspection and revisit the market since the last appraisal and definately attach your 1004MC to the report.......it is a must! Charge more for these than you would a final inspection.

 

[TX ladybug]

Also Mortgagee Letter 2010-13 gives you additional uses and guidance, if it is an FHA? You can also call 1-800-CALLFHA (1-800-225-5342)