203k Refinance - As-is Value

[ROBERT JONES]

I did a 203k in June - refi where owner is expanding the house by 1000 sq ft. Today I receive a request for an as-is value. That is a second appraisal in my opinion. They are saying it's always REQUIRED BY FHA. and part of the deal when you accept the order. I am scouring FHA docs and don't see anything about required to supply an as-is value. Any help is appreciated.

 

[Meandering]

Not an FHA requirement. It needed to be included in the original engagement letter, else,

new assignment, new fee.

 

[Mike Kennedy]

I did a 203k in June - refi where owner is expanding the house by 1000 sq ft. Today I receive a request for an as-is value. That is a second appraisal in my opinion. They are saying it's always REQUIRED BY FHA. and part of the deal when you accept the order. I am scouring FHA docs and don't see anything about required to supply an as-is value. Any help is appreciated.

Who is "they" and have "they" send you the requirement.

Anytime

1. APPENDIX A - HUD/U.S.
   portal.HUD.gov/hudportal/documents/huddoc?id=DOC_36008.doc
   A-1 REAL ESTATE OWNED (REO) FHA’s Real Estate Owned ... B. Appraisal Requirements for REO properties. ... Appraisal Institute defines an "as-is" value as follows:
   

1. FHA 203(K) Loan Appraisal Guidelines and ...
   bankREOguide.com/FHA/203k-loan/appraisal-guidelinesCached
   In addition to the FHA requirements, ... the utilities in the subject ... the loan underwriter may determine that there is no need for a “as is” value appraisal ...

1. FHA REO Purchase | AppraisersForum.com
   • appraisersforum.com
   • › …
   • › FHA/HUD and VA
   FHA REO Purchase ... FHA MPR minimum property Requirements either as is or subject to the ... regular FHA appraisal 'subject to' any required repairs ...
   
   
2. Understanding HUD REO-Part Two: The REO Appraisal...
   www.mortgageprocessor.org/mortgage-processor-news/2013/...Cached
   ... (Real Estate Owned) Sales for purposes of FHA ... in regards to the HUD REO appraisal requirements. Need FHA ... as is” market value to provide a ...
   
   
3. FHA REO Purchase | Page 3 | AppraisersForum.com
   • appraisersforum.com
   • › …
   • › FHA/HUD and VA
   FHA REO Purchase ... A 203K is not a "as is" appraisal. ... As expected, I was told to complete a standard FHA appraisal subject to any required ...

 

[Tom D]

Effective for case numbers assigned on or after September 14, 2015

The Appraiser may be asked to perform two separate types of valuation by the Mortgagee for Standard 203(k) and Limited 203(k) Rehabilitation Mortgages. The Mortgagee may order both reports from the same Appraiser or select two different Appraisers for the two valuation assignments.

If a Mortgagee requires both an as-is and an after-improved value of the Property, the case will require two separate appraisal assignments and reports:

• an analysis to provide the as-is value; and
• a separate analysis performed under the hypothetical condition that the repairs have been completed.

i don't know if they want an as is now everytime, though i think i saw that somewhere, but brain dead after reading hand book. the answer is, you would not have accepted both value assignments for one appraisal fee. however, this is a business decision as to how much you like your client. the 203k is a lot of work. issues with repairs is that if most of them are invisible ,how much value did they add if not a remod or rehab. the effective date above says september, but that was supposed to be june or july, but everbody freaked out.

 

[Tom D]

that was from HUD's web site, the new more friendly down loadable 4000.1 handbook pdf. problem is that it don't tell you what page it is on, but nice seach features.

 

[CANative]

It's optional and up to the lender. They should have told you up front to allow you to set the appropriate scope of work and price the appraisal.

After the fact they need to be willing to renegotiate the fee to allow for the extra work.

Ask for an extra $200-$300 or so. You will likely need additional comps and some new inspections of the comps. Plus you will have to rework several areas of the report.