ADU Comparable

[J Grant]

It’s doesn’t say it’s not required most of the time.

Here are the referenced FAQs.
View attachment 72213

Thanks for posting it!! (I was a fail at finding it in my search idk why, rushing during the week)

The last portion is of interest and is germane to my URAR form argument:

Last paragraph Physical Segments ( 5 Acre portions)

" Standard rule 1-2 (e) (v) states that the subject of an assignment may be a physical segment of a property, must also comply with any laws, regulations, guidelines or other assignment conditions, that might apply.

"If the assignment requires compliance with published assignment conditions, the appraiser must be aware of the current guidelines (or regulations if applicable )
" Failure to recognize applicable assignment conditions would be a violation of the ETHICS RULE or the CCOMPTENCY RULE"


Red flag alert: The URAR Form is itself, an assignment condition!! it is an assignment condition because of the certs and limitations in the form we sign off on as we complied with !!! And those certs include the no adding any additional HC and the published, printed on the form options for our value opinion are " as is", OR "subject to ( completion or repair HC ) . TWO options ! Pick one. Pick some third invented option you hope will fly and you just violated the URAR assignment condition. Still doubtful? The UAR printed form consists of "Published assignment conditions". I 'll take GSE entity published UARA assignment conditions would override a client (AMC staffer or lender) asking for an assignment condition they invented which is not URAR compliant.

Still wondering about the red flag waving down a residential URAR form we sign if we choose to ignore the certs? They authors above USPAP puts in capital letters the two USPAP violations!!!

So this is not about my ego or opinion, this is the reality, and imo why we need to be cautious when otherwise astute ppraisers who rarely, or never do URAR work advise, to "think outside the box". Well, people, the URAR is a fcking box!! Accept or reject it but don't try an end game run around it, because we sign and certified we stayed within the box of its assignment conditions. "

 

[CGinMN]

My argument also involved not being misleading ( which is in USPAP), and my point was, how can an appraiser conform to the assignment condition inherent with a URAR form while trying to meet a contradictory assignment condition from a client.

I understand what you are saying, but the GSEs require the use of HCs on an “as is” appraisal when valuing CLTs, so it can be done if the user is ok with it. In this case, the user would be ok with it if it’s an in-house loan, which is why it’s important to confirm.

 

[J Grant]

I understand what you are saying, but the GSEs require the use of HCs on an “as is” appraisal when valuing CLTs, so it can be done if the user is ok with it. In this case, the user would be ok with it if it’s an in-house loan, which is why it’s important to confirm.

I am confused this word salad.

The URAR form in itself is an assignment condition, with certs and limitations on what those assignment conditions are. The URAR form and its certs do not change wither it is an in house loan or not !!! I'd bet this has tripped appraisers up in the past, who assume they can ignore the URAR form certs because a client told them it would be an "in house loan/portfolio loan" They can say that, and be free to turn around and sell the loan on the secondary market, or go after the appraiser if they want to and I bet those very same clients are the ones who sell the appraiser out if the loan is subject to a future audit.

The use of an HC on the URAR form is specific (read a printed or online PDF URAR form ), the use of the HC is subject to completion or repair. No other third, invented, silent or assumed or added HC option exists that can be compliant with the printed assignment conditions, even if the "user is ok with it" -

 

[CGinMN]

No other third, invented, silent or assumed or added HC option exists that can be compliant with the printed assignment conditions, even if the "user is ok with it" -

I don’t disagree with you, but the reality is that users do it all the time. The 1004 isn’t meant for in house loans, but users still request it and appraisers still provide it, don’t they?

You have done CLTs, right? Curious how you did them without including a HC, since that is an assignment condition.

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[J Grant]

I don’t disagree with you, but the reality is that users do it all the time. The 1004 isn’t meant for in house loans, but users still request it and appraisers still provide it, don’t they?

You have done CLTs, right? Curious how you did them without including a HC, since that is an assignment condition.

View attachment 72221

Community Land Trust (CLT) Mortgages

We’ve reimagined the mortgage process for Community Land Trusts (CLTs) and properties subject to resale restriction. We believe we’ve found the right balance among the interests of CLTs, borrowers and lenders. Our CLT mortgage offering preserves affordable housing units over time, promotes...

sf.freddiemac.com

So the excuse is other appraisers are out of compliance and going against the certs they signed, so it is okay to do it?
IMO that is terrible advice but we each give our own opinion so what can I say to that.

I fail to see above generic blurb copied about an HC about a leasehold has anything to do with anything - From Freddie then it is part of in my rare for a URAR assignment to be a leasehold interest and when it is it usually involves other GSE or entities published guidelines regarding an HC from Fannie Mae or Freddie or FHA- so the appraiser has to comply with those -such as Fannie has a specific set of published assignment conditions for a community investment property loan with a land lease how to appraise it.

 

[CGinMN]

The point is GSEs have THEMSELVES requested that appraisers modify their forms, which explicitly say they cannot be modified. Didn’t you do any Covid desktops? Guess you were out of compliance!

It is pointless engaging with you because you always just argue for the sake of it, and you fail to read and comprehend what others are trying to communicate. You see what you want. So, I’m done with you for awhile.

 

[J Grant]

The point is GSEs have THEMSELVES requested that appraisers modify their forms, which explicitly say they cannot be modified. Didn’t you do any Covid desktops? Guess you were out of compliance!

It is pointless engaging with you because you always just argue for the sake of it, and you fail to read and comprehend what others are trying to communicate. You see what you want. So, I’m done with you for awhile.

If the GSE THEMSELVES ask for a modification such as the covid exception then they have published those guidelines/exceptions, and that is different than an appraiser deciding not to comply on their own or an appraiser out of compliance because a client asks for it. I addressed that in my answer to you when I said what your posted FREDDIE blurb did wrt it is their own published requirement for a leashold Community redevelopment loan - which was not the original topic but I can agree on that for what it is.

 

[ZZGAMAZZ]

Getting back to the half finished ADU as an appraisal problem ( all of us will encounter oddballs like this at some point), a case can be made for making it "as is", with no value as a conclusion by an appraiser ( if no clear support is found for a value ) by including DOM/Marketing in the value opinion analysis.

We appraisers tend to overlook that for market value, is not just the numerical dollar amount in a vacuum. The $ amount ALSO has an estimate of market exposure - ( 60-90 days, for example)

While it likely could have or does have a contributory value, it might be quite low. That is because having to pay anything for a part finished ADU vastly reduces the buyer pool ( typically). While the feature of a finished ADU might somewhat reduce a buyer pool, let's assume there is demand for it in the subject area. But how much demand is there for a house with a part finished ADU that might cost a substantial amount to complete? Plus the headache of hiring a contractor, getting the permits and final inspections etc. Call and speak to a bunch of local RE agents to survey it for support.

So the analysis might look like this: " The typical house with a finished ADU sells in 60-90 days market exposure. No sales of homes with a part finished ADU was found. The appraiser surveyed a number of area RE agents and the majority estimated a market exposure estimate of 6-8 months to get contributory value for the part finished ADU in a sale. Thugh the buyer pool is most probably very limited to pay $ for the half finished ADU , if the existing partial structure was not expected to return an additional premium, the market exposure estimate would likely be in the 60-90 day range ."

Therefore, the appraiser did not adjust for the partially finished ADU in order to arrive at a market value opinion of X$ with a market exposure estimate of 60-90 days.

The alternative, if the appraiser finds support for a 15k contributory value but believes that would add months to the DOM, then adjust for it and your value opinion would be X$ with a 6-8 months DOM market exposure estimate (for example)

Possible, but if one is going to eyeball zero market reaction,nit would be equally as logical to report negative market value, although one of your earlier posts suggested that the percentage of completion is a critical factor...

 

[ZZGAMAZZ]

I am confused this word salad.

The URAR form in itself is an assignment condition, with certs and limitations on what those assignment conditions are. The URAR form and its certs do not change wither it is an in house loan or not !!! I'd bet this has tripped appraisers up in the past, who assume they can ignore the URAR form certs because a client told them it would be an "in house loan/portfolio loan" They can say that, and be free to turn around and sell the loan on the secondary market, or go after the appraiser if they want to and I bet those very same clients are the ones who sell the appraiser out if the loan is subject to a future audit.

The use of an HC on the URAR form is specific (read a printed or online PDF URAR form ), the use of the HC is subject to completion or repair. No other third, invented, silent or assumed or added HC option exists that can be compliant with the printed assignment conditions, even if the "user is ok with it" -

I'm curious: could the Intended Use ever describe the client's loan designation, e.g., portfolio, etc.?

 

[J Grant]

I'm curious: could the Intended Use ever describe the client's loan designation, e.g., portfolio, etc.?

I have no idea, it an odd question i never thought of

The point is, clients can lie and tell appraisers it is in house/ a portfolio loan ( when in reality they can package it the next day and sell it to the secondary market ) By saying that, the client is hoping that maybe they can ask/influence the appraiser to do X, which is out of compliance to the URAR certs and limiting conditions. These appraisers might ask themselves if is an in house portfolio loan and not going to FF/ secondary market, why does the client want it with UAD on a URAR form ?.

The URAR form is an assignment condition the appraiser signs they were compliant with, regardless of what the lender does with the loan later, or if they ever make a loan on the property. They can use my report for cat litter if they want to, but my appraisal was compliant with the URAR form certs on my end.