An Open Letter to Fannie Mae RE: multiple parcels

[George Hatch]

Lending is lending and appraising is appraising?

 

[Mr Rex]

Umm, yes? Unless you want to divide and conquer as the OP seems to want. Since FNMA is the largest lender in the universe and largest user of appraisal services, I'd suggest the fat girl casts a wide net? I understand you are commercial in day to day, but I think you have some basis in reality. The OP, maybe not so much for what ever reason.

 

[Lee Lansford]

Umm, yes? Unless you want to divide and conquer as the OP seems to want. Since FNMA is the largest lender in the universe and largest user of appraisal services, I'd suggest the fat girl casts a wide net? I understand you are commercial in day to day, but I think you have some basis in reality. The OP, maybe not so much for what ever reason.

I would love to see your H&BU analysis and how you would develop a single opinion of MV for the scenario that I offered by link in the OP.

Go on. Try it. But, proper appraisal practice, please. Show us how it's done. If you need assistance, you may call on Andrei Fin and/or JGrant.

Or, do you prefer going off on tangents?

 

[Andrei Fin]

I would love to see your H&BU analysis and how you would develop a single opinion of MV for the scenario that I offered by link in the OP.

Go on. Try it. But, proper appraisal practice, please. Show us how it's done. If you need assistance, you may call on Andrei Fin and/or JGrant.

Or, do you prefer going off on tangents?

We'll do a HBU analysis when you show your Scope of Work.

 

[George Hatch]

"...when you show your Scope of Work "

Exactly what do you mean when you say "show your SOW"? Is not the SOW that an appraiser developed demonstrated by what they did and didn't do in their assignment?

Or are you somehow angling towards asking which elements the appraiser considered in making their SOW decisions?

 

[Carnivore]

"value" definition is huge in the dichotomy as well. "Value in use" or "use Value" vs "Market Value" are huge differences. If they want "use value" or "value in use", give it to them. Make them happy.

Might want to disclose in caveat's this is NOT a market value opinion.

Provide definitions of both use value and market value. Your good with USPAP then, imo. Make sure you reference the definition sources.

It is the Form! This situation also is contrary to Inter-agency Guidelines related to the MV on the bottom of Page two of the URAR. - Meaning in this type of assignment there has to be three types of Opined Values: One is MV of the singular improved parcel ; the Vacant Ready for improvement site(assuming both sites are identical HBU). and the Third Value aka Combined parcels = Value in Use

The solution is simple, but it causes a process problem for FNMA and the Lenders. Call it Auto-fill/transfer to other loan Documents in the entire Mtg loan Package.

What is not a Problem is combining the two separate parcels on one deed or even having two deeds.

What is not a problem is the Deed of Trust document(encumbrance) that is filed with the County Registrar of Deeds. That can have one,two more parcels identified in the report in the Deed of Trust.

Humorous Side Comment: I can't find or remember what appraisal file this was but i received a reconsideration of value and the AMC Phone Money sent me a list of SFR Sale to consider. It was huge about 25 sale. What the nimrods did not understand was that 14-16 of the sale were all on one deed as a bulk sale. LOL took me forever to make them understand that! The reason it was weird and mislead them was the Bulk Sale deed Stamp equated to over a $500,000. The county divided that amount equally among all the separate deeds as a transfer. I think they did that for the Tax Office assessor.

I think I have summed up the Controversy: The 800 lb Gorilla is pushing an expedient solution, so they can commingle a 30 year 3.5% interest rate loan SFR home loan with a vacant land site loan. We all know you can't get a 30 year 3.5 % loan on vacant land. Well maybe some farm loan programs exist with those terms, but I don't know.

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I have an example that will blow all of there counter arguments out the window!

Lets say you assignment is to appraise an SFR FNMA/FFed-Related Banker on a 1004

You look the subject up and Its a SFR sitting on the corner of two streets. and its urban. The total site area is 2 Acre. - Current Zoning R-3 - 3 units per Acre.

The market is going through gentrification and there are new builds, renovation projects and as-is SFR sale all over the subjects market segment.

 

[J Grant]

I would love to see your H&BU analysis and how you would develop a single opinion of MV for the scenario that I offered by link in the OP.

Go on. Try it. But, proper appraisal practice, please. Show us how it's done. If you need assistance, you may call on Andrei Fin and/or JGrant.

Or, do you prefer going off on tangents?

I'd be happy if he called me..( but no need lol ) BTW I do a lot of complex and high end work - and reviews. m.

No matter what HBU analysis anyone presents, you will simply tell them they do not understand proper appraisal, they need to take a HBU class etc ....the only "right" answer in your eyes is your answer .

 

[BRCJR]

As a borrower I want the maximum legit value for my LTV. The LTV goes directly to my interest rate, all else being equal.

 

[Eli]

As a borrower I want the maximum legit value for my LTV. The LTV goes directly to my interest rate, all else being equal.

That's a wrinkle. Your not the client. LOL

 

[Econobot]

You too. Can't accept you are wrong is not a good sign for future endeavors, and you are way off track. Again I ask, where is the Public Trust diminished by this publication and edict and/or why is Public Trust improved by your opposition opinion. Please elaborate.

Go down to your local bank and ask them about financing a vacant parcel of land...see how much they want down? Now consider what Fannie is offering with trying to get an appraiser to value excess land as "value in use". You might realize that in this unique situation a borrower can finance vacant land for 5% down? Consider that this 95% LTV for vacant land is not only unprecedented it's offered by noone else in the market, anywhere, ever. Now, back to public trust, the public is subsidizing this 95% LTV for what? raw land which is normally financed at 70% LTV... Are you starting to get the picture? If the public knew they could finance raw land at 95% LTV the country would go nuts and raw land would be getting bought up in mass. This is protecting public trust, no different than ignoring obvious issues with a house in an FHA scop appraisal, you're ignoring guidelines in order to present a product that will fund a loan. Departing from appraisal theory in order to produce a product to fund a loan, public trust is gone. If you do this crap you're a homeowner/lender advocate and shouldn't be trusted as an appraiser.