2055 Exterior-only For Multi-family

[GASTON]

Good Morning Everyone,

I Recieved In Order From A Client To Perform A 2055 Exterior Only For A Multi-family{duplex} Home. This Is The First 2055 I Will Be Performing For A Multi-family. In The Form For A 2055 Exterior Only Under Pud Information, It States That The Report Form Is Designed To Report An Appraisal For A One Unit Property. I Cant Seem To Locate A Form For A 2055 Exterior Only For Multi-family{duplex}. What Should I Do In This Case. Thankyou

 

[Mike Kennedy]

Exterior-Only Inspection Residential Appraisal Report (Form 2055)
This report form is designed to report an appraisal of a one-unit property or a one-unit property with an accessory ... for loans delivered to Fannie Mae. ...
www.efanniemae.com/sf/formsdocs/forms/2055.jsp

 

[Ricardo]

Badda bing - thanks for nailing that Mike. The only thing I think should be added is this - why would anyone NOT want the full blown CORRECT appraisal done ? Hmmmmmm - to save some bucks. You're the professional right ? You've been taught how to do your job - so do it the right way, or you may be among those explaining to the board... well, that's the way THEY wanted me to do it - which has never worked out as a good excuse.

 

[Mike Garrett RAA]

Depends on the Scope of Work. You could do an exterior only inspection on a nuclear power plant...wouldn't that be interesting? If your client wants the appraisal report on a 2055 form then you have a problem!

 

[TJSum]

IMHO it is just too risky to do a 2-4 unit as an exterior only. Most likely, that is why they did not make an exterior only form for them. I know we can say this about all properties, from an appraisers view point, but with 2/4's it is totally "impossible" as there is more in depth research needed. Each unit could have vastly different condition, depending on the tenants of each. How would you know how much GBA area to assign to each unit. Are they legally set up, etc. There are hundreds of extra questions like these that need answered on these properties.

A couple years ago, I appraised a three level townhome with a basement apartment (a fourth level). When doing the inspection, the owner told me and it was readily apparent he lived on the top three levels and rented out the basement apartment for $1,000 per month. After turning in the report, I got a call from the lender telling me that my report was wrong. Evidently the borrower told the lender he lived in the basement and rented out the upper level for $2500 per month. He needed the extra income to qualify for the loan. One of his friends signed a bogus lease to show the bogus rental income. The interior inspection by me revealed the truth, this is just one example of thousands on why interior inspections are needed in these circumstances.

 

[Mike Garrett RAA]

Risky to whom? It's all in the Scope of Work.

 

[TJSum]

Risky to the appraiser. Yes, it all is in the Scope of Work. On the 2055 form check the second paragraph. We MUST feel confident that we have enough data to produce a competent report. It is our call as an appraiser. IMHO for 2/4 units we do not as an exterior only inspection. But each appraiser must answer that for themselves, if you feel comfortable doing it, have at it. But getting back to the original question, what form could you use, would it have to be a narrative report?

 

[Don Clark]

Risky to the appraiser. Yes, it all is in the Scope of Work. On the 2055 form check the second paragraph. We MUST feel confident that we have enough data to produce a competent report. It is our call as an appraiser. IMHO for 2/4 units we do not as an exterior only inspection. But each appraiser must answer that for themselves, if you feel comfortable doing it, have at it. But getting back to the original question, what form could you use, would it have to be a narrative report?

How would you write a narrative on an exterior only 2-4 family property? You could use whatever form you believe would not be misleading. You could write it on a brown paper bag as long as you comply with USPAP. As far as risk, you can preclude that as much as is likely possible by writing a sufficient SOW. You cannot do that when the SOW is already written for you such as the new 2055.

 

[Scott Kibler]

I do them quite often, for retrospective appraisals only. I use the old 2055 and utilize plenty of extraordinary assumptions, additional clarifcations, etc etc.

 

[CCAAMO]

Good Morning Everyone,

I Recieved In Order From A Client To Perform A 2055 Exterior Only For A Multi-family{duplex} Home. This Is The First 2055 I Will Be Performing For A Multi-family. In The Form For A 2055 Exterior Only Under Pud Information, It States That The Report Form Is Designed To Report An Appraisal For A One Unit Property. I Cant Seem To Locate A Form For A 2055 Exterior Only For Multi-family{duplex}. What Should I Do In This Case. Thankyou

What is the purpose of the appraisal? Is it for a loan? Why can't the client gain interior access to the property for you?

If its for a loan and the client can but won't get you interior access, then thats an assignment you may want to decline!

If its for a retrospective valuation then interior access may not be possible and you will have to use the limited data available to you,
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