A few questions on REO Appraisal Procedure

[ZZGAMAZZ]

If what you say is accurate, all of my questions/concerns are moot.

However:

Why does the client care what the value would be on the effective date regardless of market exposure? What's the intended use? It is what is was and the events leading up to the effective date, i.e., market exposure, are of no consequence in the future when the client's marketing/repair decisions/plans will be implemented.

If the appraiser defines exposure as 60 - 90 days on the effective date, the client-imposed exposure time would not have affected the opinion of value--if my assumption is correct that appraised-opined exposure is established simultaneous to the opinion of value being determined, in any type of "as is" report."

 

[CANative]

If what you say is accurate, all of my questions/concerns are moot.

However:

Why does the client care what the value would be on the effective date regardless of market exposure? What's the intended use? It is what is was and the events leading up to the effective date, i.e., market exposure, is of no consequence in the future when the client's marketing/repair decisions/plans will be implemented.

Because if they wanted it the right way appraisers would charge more.

 

[ZZGAMAZZ]

It is very refreshing to see the real GB return to the Forum after a brief self-imposed period of non-sarcastic exile. However, tangible comments would be more enlightening to those less informed, including me. [Please hurry: the bar opened 10 minutes ago.]

 

[CANative]

That wasn't sarcasm.

They're disguising a consulting assignment to look like an appraisal assignment. A consulting assignment's purpose is not an appraisal but an appraisal must be a component of the consulting assignment. The appraisal consultant can use someone elses appraisal or they can develope their own appraisal as part of the assignment. In the REO assignment the appraiser develops the appraisal in addition to performing the (disguised) consulting assignment. The fee should be closer to $1,000 or so versus $300 or $400 or so.

 

[CANative]

Where'd you go Z? It was just getting interesting.

 

[Tim Hicks (Texas)]

I like it better when you add sarcasm with funny pictures.

 

[CANative]

 

[PropertyEconomics]

That wasn't sarcasm.

They're disguising a consulting assignment to look like an appraisal assignment. A consulting assignment's purpose is not an appraisal but an appraisal must be a component of the consulting assignment. The appraisal consultant can use someone elses appraisal or they can develope their own appraisal as part of the assignment. In the REO assignment the appraiser develops the appraisal in addition to performing the (disguised) consulting assignment. The fee should be closer to $1,000 or so versus $300 or $400 or so.

Unless of course its 500 acres .. then $250 will do .....

 

[ZZGAMAZZ]

I was already 10 minutes late to the bar, & just regained my wits a day later.

Nevertheless, to paraphrase my earlier questions,

What is the intended use of a REO addendum? The anticipated market value or the property with the client-imposed market exposure results in today's market reaction but has unknown bearing on the future, after the property is restored to as is condition. Also, if the effective date is the date of the appraisal-related-values and client-related-values date as well, the retrospective period ends on the effective date and the length of market exposure leading up to the effective date are a) identical if both exposure periods are equal, and b) useless if the two exposure periods differ because they both ended up with the as is value on the effective date, which pertains largely to the original list price, and there is no original list price regarding the client-imposed-exposures . . . what whadda whadda is it that I don't understand about the "intended use" of this type of report?

Are clients ordering the REO addendum assuming that the appraiser is giving them 2 protrospective values, based upon the effective date going forward, although appraisers are providing the 2 dates based upon the traditional definition of exposure, going back in time?

 

[CANative]

What is the intended use of a REO addendum?

The intended use is to spoon feed the client with advise concerning the best course of action in disposing of surplus property. It's cleverly disguised as being nothing more than 4 appraisals when in reality it is a consulting assignment where the appraiser must also develop the appraisal component.

Are clients ordering the REO addendum assuming that the appraiser is giving them 2 protrospective values, based upon the effective date going forward, although appraisers are providing the 2 dates based upon the traditional definition of exposure, going back in time?

In my opinion they have either mixed the two opposite concepts (exposure time and marketing time into "market exposure") either because they are idiots or because they are very smart and don't want pay for a proper assignment by a qualified appraiser.

The main problem with the REO addendum (format) is that all values are presumably current but that's not the way they intend to use the results.