1004mc

[Deleted member 134708]

Here's how you win the argument for the page 1 and 1004 must match folks. Note: could not care less which way do it.

Every assignment they take on, they ask/confirm if it is being sold to FNMA or requires FNMA FAQ to be followed.

If they do not inquire/confirm, then their report is extremely misleading.....if no why, what , how included.

I'm a credit union, I may or may not hold my own paper. I may sell my paper to Japan, I may not. I order a 1004.

You assume, FNMA FAQ. I assume you followed pre-printed instructions of the form I have in my hands.

So the FNMA followers produce 2 diff reports. 1 for FNMA clients. 1 for non-FNMA and they ask ahead of time.

They are Liers if they say they mass produce 2 different analyses....correctly.

 

[residentialguy]

Hey resguy,

I'm too late to ask in the conversation but I wanted to know how you handle this if pg1 matches the top of page 2.

Since page one has nothing to do with the top of page 2, I assume that you meant the 1004mc form, not pg one. So to answer the question: how you handle this if 1004mc data matches the top of page 2. It should match it. The data on the mc show exactly what the top of pg 2 asks for.

I'd like to do it the way you suggest but I don't know what would happen in this scenario?

Neighborhood values- i state all the single unit values and that goes on page 1 and on the MC I will refine it with additional filters to what is comparable to the subject and use that data for the MC and top of page 2. Is this ok to do? This is the way I learned to do it.
The neighborhood data (if there's enough of it) is what I explain and fill out for the trend boxes.

To check the trend boxes, you typically have to do additional searches (beyond just the comp data asked on the 1004MC), but you do that in order to aide you in finding out the trends of similar/comparable homes...not the trends of the whole real estate surrounding of your expanded search parameters. If you expand your parameter, you have to adjust (so to speak) for those additional variables. In other words, the trend boxes are to reflect similar properties....so the appraiser has to do additional homework when they expand search parameters order to make sure those results are the same as similar property trends....if not, explain.

 

[Valueseeker]

I misunderstood you #22. I agree they are different.

 

[Don Clark]

Wikepedia:

A neighbourhood (Commonwealth English), or neighborhood (American English), is a geographically localized community within a larger city, town, suburb or rural area. Neighbourhoods are often social communities with considerable face-to-face interaction among members. Researchers have not agreed on an exact definition, but the following may serve as a starting point: "…Neighborhood is generally defined spatially as a specific geographic area and functionally as a set of social networks. Neighborhoods, then, are the spatial units in which face-to-face social interactions occur—the personal settings and situations where residents seek to realize common values, socialize youth, and maintain effective social control."[1] The Old English word for "neighbourhood" was neahdæl.[

More later

 

[Don Clark]

Fannie Definition, clear as mud:

https://www.fanniemae.com/content/guide/selling/b4/1.3/03.html#Overview

 

[J Grant]

Market Conditions Addendum to the Appraisal Report (Form 1004MC)
The lender must confirm that current market conditions are identified and analyzed in the valuation process and described in the appraisal report.
Form 1004MC is required for all mortgage loans delivered to Fannie Mae with appraisals of one- to four-unit properties. It is intended to provide the lender with a clear and accurate understanding of the market trends and conditions prevalent in the subject neighborhood. The conclusions regarding trends that are obtained from the 1004MC Form must be reported in the Neighborhood section of the report form.

In situations when there is not sufficient data to provide a meaningful analysis for the defined neighborhood, the form must be completed based on the information available, and an explanation must be provided. The lack of data may be an indication of the market conditions. If additional analysis of nearby areas that include competitive properties is performed, it must be discussed in the summary/conclusions section of the form. In any scenario, the Neighborhood section of the appraisal report must include the appraiser’s conclusions regarding the housing trends.

It's the UAR form that is flawed....neighborhood is defined as boundaries. land use, property type.. BUT Fannie in neighborhood section wants the conclusions from MC analysis ONLY on the trend section (3 boxes). Would be nice if they re formatted page one and replaced "neighborhood" for the trends section with a better word. The form is flawed, but we are provided with instruction how to handle it from Fannie, so for appraisers to not do it correctly imo can only hurt the appraiser if the file is questioned later..

 

[Valueseeker]

If you define your neighborhood as a section of the city, how are you guys creating the list for the MC?

My issue is sometimes that some comps are labeled with the section and others are not. (I know it's a realtors marketing game to include/exclude the section as some sections aren't as appealing to potential buyers) So if you run a filtered search through MLS, you miss those in your data gathering so I'll do a radius around the subject but then it's not truly within the boundaries as it may go over or under the boundary limits. Adding them manually is the answer?

 

[J Grant]

If you define your neighborhood as a section of the city, how are you guys creating the list for the MC?
My issue is sometimes that some comps are labeled with the section and others are not. (I know it's a realtors marketing game to include/exclude the section as some sections aren't as appealing to potential buyers) So if you run a filtered search through MLS, you miss those in your data gathering so I'll do a radius around the subject but then it's not truly within the boundaries as it may go over or under the boundary limits. Adding them manually is the answer?

Your comps for the subject (which will populate MC form grid/ additional MC analysis), may come from outside the subject physical boundary "neighborhood", if those comps are those that a typically motivated buyer for subject will consider. We tend to use closer comps if available, but sometimes the best comps are not close or in the defined neighborhood. When that is the case, the MC form and your conclusions from it supports your comps being 3 miles from subject or in a competing neighborhood, or older than a year . Our comps often differ from that of a REALTOR.. If we don't know how to search for good comps for our subject, we can't competently appraise the property.

The Fannie directive about MC form and trend section page one is about reporting results of our comp search, it does not tell us which comps to use or how to search for them.

 

[Don Clark]

If you define your neighborhood as a section of the city, how are you guys creating the list for the MC?

My issue is sometimes that some comps are labeled with the section and others are not. (I know it's a realtors marketing game to include/exclude the section as some sections aren't as appealing to potential buyers) So if you run a filtered search through MLS, you miss those in your data gathering so I'll do a radius around the subject but then it's not truly within the boundaries as it may go over or under the boundary limits. Adding them manually is the answer?

Fannie Mae should define a neighborhood with specificity. Since they won't do that I will continue to do as I have always done, the best I can. I am inspecting a property today that has had 3 sales in past year. None of the 3 sales support the sales price of the subject. The "Neighborhood" next door has had many sales in the past year. I will use the 3 from subject neighborhood an a like amount from the neighborhood next door, and explain why, and the data on the 1004MC will present a misleading picture of the subjects market, but fully explained so the reader knows exactly what I have done. That way, I will have produced a "Credible" appraisal report.

 

[ucbruin]

I still don't understand, but you are raising an issue that many others raise... so it isn't just you by a long shot.
How can a form be misleading when I'm the one who is ultimately responsible for (a) interpreting all the data necessary to make a conclusion which almost always (in my case) includes supplemental information to what is in the 1004MC and (b) presenting that data, explaining how I interpret, and then stating what my conclusion is?

Bottom line: It isn't the form that is making the conclusion... it is me. How can the form be misleading when I'm the one who is presenting the analysis and making a conclusion (clearly presented, summarized, and stated in the report)?

What am I missing?

Appraiser controlled form.....

Isn't it a possible reason that djd09's opinion may have some validity?

I'm not saying djd09 is correct....