1007 and Short Term Rental

[Fernando]

Glad to be of help. Have used it myself. As counter intuitive as it may seem. Sometimes Fannie guidelines and/or regs can be your friend

I admit, for once you were helpful. Normally, I pass on such "unique" assignments since client wouldn't pay me enough to do it.

 

[Surf Cat]

I admit, for once you were helpful.

You are in rare form today king.

 

[TerryRohrer]

I admit, for once you were helpful. Normally, I pass on such "unique" assignments since client wouldn't pay me enough to do it.

We were never under the impression that it was because you are competent enough to recognize that you are not competent enough.

 

[Fernando]

You are in rare form today king.

Is that good or bad?
I woke up and my ankle has swollen down and doesn't hurt as much.
I can't wait to recover and go to the beach soon.

 

[Dublin ohio]

I admit, for once you were helpful. Normally, I pass on such "unique" assignments since client wouldn't pay me enough to do it.

Nothing unique about it as long as you have the knowledge and the ability to use said knowledge

 

[Fernando]

Nothing unique about it as long as you have the knowledge and the ability to use said knowledge

I always see what data available and how much effort needed to do the assignment.
Based on decades of experience, sometimes it's best to pass and let a sucker appraiser take it.

 

[Tom4value]

Hey everyone. I just got another request to complete a 1007 for a "Short Term Rental". For the past 10 years I have always used, and understood, that the 1007 was for long term rentals only.Has something changed in this for, or in lending that has made it possible for 1007 to be used for short term rentals? Thanks in advance.

What is your “short term rental”?

The 1007 is fine for monthly (like 6, 7 months, under a year). It is not for daily as it is now a commercial entity.

 

[sputnam]

Hey everyone. I just got another request to complete a 1007 for a "Short Term Rental". For the past 10 years I have always used, and understood, that the 1007 was for long term rentals only.Has something changed in this for, or in lending that has made it possible for 1007 to be used for short term rentals? Thanks in advance.

Typically, the Lender wants the 1007 to establish income to qualify the borrower. You shouldn't use the 1007 to establish the STR income for valuation purposes. Instead, write comments.

 

[Elliott]

I was talking to my sister on Christmas Eve and she was complaining about the STR (AirBnB) that is next to her beach house. Turns out the house was 'rented' on a long term lease and the 'tenant' turned around and made it into a short term rental. The tenant got approval from the City. She complained and the City did nothing, even though their rules require the applicant be the owner of the property. It is sad the way cities and counties are only interested in their cut of revenue.

Regarding the 1007, the Guide says:

"In summary, while a lender may choose to request a 1007 for an appraisal of an STR, in fulfilling the assignment the appraiser must use rental comparables with monthly lease rates to support the “Indicated Monthly Market Rent.” Alternative definitions and methodologies are not acceptable. Form 1007 cannot be used to estimate the nightly fee for an STR."

 

[J Grant]

Typically, the Lender wants the 1007 to establish income to qualify the borrower. You shouldn't use the 1007 to establish the STR income for valuation purposes. Instead, write comments.

I don't believe that is correct but regardless, the 1007 for the appraisal point of view is to see if the income from similar supports the opinion estimate with a GRM

The 216 form (income and expense statement ) establishes the cash flow from rental income is positive, negative, or break even. ( based on market long term leases not air bnb/short term)