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4 unit Buidling + Coachhouse = ?

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KinIL

Thread Starter
Sophomore Member
Joined
Nov 30, 2005
Professional Status
General Public
State
Illinois
Admittedly, I have never had an assignment that had a coach house before, so I'm unsure how to proceed. Before I actually solicit assistance from help in regarding completing the assignment, I need to know if I'm actually *capable* of (license-wise) completing the assignment.

Legal 4 unit building with a legal free standing building in the rear, which the owner occupies. My gut reaction is that this becomes a 5 unit parcel and I'm no longer capable of appraising this property without the assistance of a Certified General.

The legality of the of the unit in the rear is something I'm currently questioning, however the client has told me that the homeowner has a letter of occupancy from the county, but that's a crossing that I'd have after accepting the actual assignment.

Thanks

Update: Oops, just noticed the typo in the title... unfortunately can't fix :(

(But I can and did..Chris)
 
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Mike Boyd

Elite Member
Joined
Jan 18, 2002
Professional Status
Retired Appraiser
State
California
When you say......."separate free standing building in the rear.............", is that building designed as a residential unit with kitchen, bath, reasonably well finished?

I suppose you could call it an accessory building used by the owner to store tools, etc and that it is useable as a living unit. However, if the lender is using all 5 units units as projected income for the buyer to qualify for the loan, the report would most likely be rejected. A coach house implies a garage and when you say it is USED by the owner............used for what? Was it converted to a living unit and is it legal for the zoning and was the conversion permitted?

If it is legally permitted by zoning and permits were obtained for conversion to a living unit, then the project is 5 units. A certified general would have to sign off depending on your state's licensing laws.
 

David Wimpelberg

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Staff member
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Joined
Mar 30, 2005
Professional Status
Certified General Appraiser
State
New York
If this is a 5-unit property and if for a lender, it would be advisable to call the lender. These types of properties aren't typically handled through the residential department, and have different rates.
 

Restrain

Elite Member
Joined
Jan 22, 2002
Professional Status
Certified General Appraiser
State
Florida
This is a five-unit property. There is no such thing as a 4-unit + auxiilary unit. Definitely talk with the client before proceeding.
 

KinIL

Thread Starter
Sophomore Member
Joined
Nov 30, 2005
Professional Status
General Public
State
Illinois
This is a five-unit property. There is no such thing as a 4-unit + auxiilary unit. Definitely talk with the client before proceeding.

Just what I expected, however the owner is insisting upon the previous appraisal having been done only by a certified residential, and the client is stating that the previous docs indicate that it was a conventional (non-commercial) loan... Likely that the previous appraiser wasn't qualified for this assignment. Glad I asked around and didn't make the same mistake :)
 

David Wimpelberg

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Mar 30, 2005
Professional Status
Certified General Appraiser
State
New York
Just what I expected, however the owner is insisting upon the previous appraisal having been done only by a certified residential, and the client is stating that the previous docs indicate that it was a conventional (non-commercial) loan.

This type of misrepresentations do not make lenders happy. What it effectively is doing is causing the rate to not reflect the risk. I was involved in a couple of these when I used to review...lender was very annoyed.
 

KinIL

Thread Starter
Sophomore Member
Joined
Nov 30, 2005
Professional Status
General Public
State
Illinois
This type of misrepresentations do not make lenders happy. What it effectively is doing is causing the rate to not reflect the risk. I was involved in a couple of these when I used to review...lender was very annoyed.

More than likely the owner was happy because of the rate, the previous broker/banker was happy because of the relative ease the file was being handled with... but just as you said, the lender I'm sure is not happy and niether is the state for their appraising beyond their licensing.
 

timd354

Elite Member
Joined
Jan 11, 2008
Professional Status
Certified Residential Appraiser
State
Maryland
Everyone knows that a property with 5 units is not a 4 unit property no matter how the 5 units are arranged. Smells awfully much like loan fraud on the previous loan.
 
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