2nd lender wants appraisal in their name

[Doug in NC]

Here it is over a month later and the situation I had is still being resolved. Borrower called end of last week to ask for a refund because his lender was incapable of working the problem out with HUD. I told him it wasn't my fault, but his lender's. I ended up giving the borrower HUD's phone number so that he could try to get it worked out before his loan fell through. It doesn't pay to deal with a mortgage broker who isn't familiar with and/or incapable of following HUD rules.

 

[Webbed Feet]

This is not JUST about HUD! It's about USPAP.

Not to Continue beating a DEAD HORSE but ....
Lender 1 releases appraisal to Lender 2, and provided you a copy of the release in writing.. but didn't forward to report to Lender 2. Is it permissible to send Lender 2 a copy of the report or should we make Lender 1 send it out to Lender 2???

Ms. KimB,

Not only is this a HUD/FHA problem, but it is a USPAP one. You need to read the article on page two of the following link.

http://oregonaclb.org/media/news7-03.pdf

Your original client, "Lender 1" as you put it, may have sent a "release" to "Lender 2," however this does NOT relieve you of anything at all under USPAP regarding your duties to your original client. You were not "released" regarding anything at all in a case like that.

Webbed.

 

[Warren Sumner]

OK..Sceario # 742...

Broker orders an appraisal in their name and includes FHA case # on their order. Broker calls to transfer appraisal into their lender's name and I tell them I can't, however the broker tells me that the lender is listed on FHA connection as the Sponsor on the FHA connection sheet. He is sending a copy of that sheet, if they are listed as the sponsor, can the appraisal be put into their name?

 

[Greg davenport]

OK..Sceario # 742...

Broker orders an appraisal in their name and includes FHA case # on their order. Broker calls to transfer appraisal into their lender's name and I tell them I can't, however the broker tells me that the lender is listed on FHA connection as the Sponsor on the FHA connection sheet. He is sending a copy of that sheet, if they are listed as the sponsor, can the appraisal be put into their name?

Why do they need to be? FHA does not CARE who's name is on the report. The lender needs to follow the FHA guidelines to have the report transfered. This is not OUR problem, dont make it one!

 

[Warren Sumner]

I agree. Just trying to help a good client if I can. This guy is actually pretty cool for a broker and I like working for him. If I can help him within the bounds of HUD regs I will.

 

[CANative]

Email your client the link to HUD clips...

http://www.HUD.gov/offices/adm/hudclips/handbooks/hsgh/

Refer them to HUD handbook 4000.2 (Mortgagee's Handbook) and then chapter 4, section 4-2(A).

4-2 TRANSFERS OF CASE NUMBERS BETWEEN LENDERS.
A. New Lender. Lenders are expected to cooperate in the transfer of case numbers. At the request of a borrower, the case number is to be assigned to the new lender using the Case Transfer function in FHA Connection. The transferring lender is not entitled to a fee for the transfer of a streamline refinance case number, regardless of the stage of processing the loan is in. The transferring lender may be entitled to any lock-in fee collected from the borrower at the time of application. The transferring lender is required to provide the new lender with the appraisal but is not required to provide any processing documents. If processing documents are transferred, the fee for providing these documents is to be negotiated between the lenders. No separate charge to the borrower is authorized for this transfer.

 

[Webbed Feet]

I agree. Just trying to help a good client if I can. This guy is actually pretty cool for a broker and I like working for him. If I can help him within the bounds of HUD regs I will.

Mr. Sumner,

If you are in a USPAP mandatory state.... you better be concerned with what USPAP says about what amounts to a "client name change" instead worrying about HUD. Follow Mr. Boyd's post.

Webbed.

 

[Warren Sumner]

Guys,

Thanks for the feedback. I appreciate your candor and BELIEVE me, I'm not about to do ANYTHING to violate FHA or USPAP.

I just want to doublecheck, because the entity the broker wants the report transferred to IS listed on the FHA connection sheet under the sponsor ID when the case # was ordered. I have a copy of that. It just wasn't communicated to me by the broker on the appraisal order, to put the report in the lender's name instead of the broker.

 

[Mike Seward]

I am also involved in one of these situations. I completed a report for lender A. Lender B calls me and says the loan and case # has been transferred to them. They have a copy of the appraisal and their UW is requesting an additional comp.

I say you are not my client . Have a nice day.

Lender B says they called FHA who said I could supply an additional comp for them.

I e-mailed the FHA Resource Center, giving them the above scenerio and asked if I could give them an additional comp. A staff appraiser replied, "you can provide additional comps if you like provided you do not change the effective date of the appraisal-just the date the report was signed."

I e-mailed back saying that sounds like I can provide a comp if I "like" (want to), but am I required to do it for them.

A staff appraiser writes back, "the request for additional supporting documentation is one in which most industry partners find prudent to comply with. It is your decision to apply reasonable discretion when responding to your lender's request."

That sounds like they're saying that I should provide an additional comp for lender B who FHA is now referring to as "my lender."

So, I e-mailed back asking if FHA is saying that lender B has become my client as a result of the case # being assigned to them.

Haven't heard back yet.

 

[Mike Seward]

To stay on track with the original topic about changing names, the e-mail also said this:
"Also, HUD does not require the name of the lender in the original appraisal report to be changed by the appraiser when a case is assigned to a new lender. The new lender is required to have an assignment letter in the binder transferring the loan and the transferring lender needs to enter the assignment under the "Lender Transfer" screen in the FHA Connection. "