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Another Foundation Question (actually I'm just venting)

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Scott R Marshall

Thread Starter
Senior Member
Joined
Dec 14, 2006
Professional Status
Certified Residential Appraiser
State
New Mexico
Okay here's the scenario. Received an order from an AMC that I've received 2orders from in the last 1 1/2 years, the other order having been cancelled for some reason I forget. Property is a 1997 singlewide with a statement on the order that the home has a new permanent foundation. Property is for an FHA insured loan, so based on my knowledge of FHA requirements and a brief overview of FHA guidelines, I call the client (the AMC) with a cordial explanation that for the appraisal to be done "as-is" I would need a copy of the engineers report approving the foundation otherwise the appraisal would have to be done "subject to" that report. The person I spoke with acted like I was from some other planet with a statement like "we have done 100's of FHA loans on manufactured homes and this is the first time I've ever received a phone call regarding this issue. If that is what you believe has to be done, get whatever documentation you need!"

Needless to say, I was taken slightly aback by such a statement and decided to call my local field office for clarification as maybe somehow I was wrong in my thinking. The individual I spoke with at the field office was in agreement with my practice and added that lenders do this to pawn liability off onto the appraisers. I don't know whether to be glad or angry. Glad that I'm doing the right thing or angry that so many are doing the wrong thing, if the statement from the person at the AMC was true.

Went ahead to call the borrower to schedule the appointment and asked about the supposed new foundation. Supposedly the foundation was rejected by the state and the state engineer is scheduled to go back out early next week to give a possible approval.

I do have 2 questions. The first is, as a general practice, for those of you who actually appraise manufactured homes for FHA, do you notify your client and/or ask for the engineers report, mark "subject to" that report, or is the person at the AMC right and go with "as-is" and let others worry about it?

Second question may be only answerable (is that a word??) by those who appraise in New Mexico but maybe other states have similar conditions. The state has a fairly stringent guideline for permanent foundation requirements with a department devoted to manufactured homes and a database showing which homes have state approved foundations. If I am able to get a copy of this report and/or verification from the state that it is approved, is that sufficient for FHA, or does another FHA approved engineer have to go out and I receive a copy of that report in order to do an "as-is" appraisal?

Sorry for such a long post and once again, thank you in advance!!!
 
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RSW

Elite Member
Joined
Feb 18, 2002
Professional Status
Certified Residential Appraiser
State
Tennessee
As to your first question: Do the appraisal subject to the foundation inspection even if it has already been done.

As to your second question: Here is the guidlines for HUD/HFA manufactured home permanent foundation requirements.
 
Last edited:

Scott R Marshall

Thread Starter
Senior Member
Joined
Dec 14, 2006
Professional Status
Certified Residential Appraiser
State
New Mexico
RSW,

Thanks for the attachment, I've printed it out. I was leaning toward "subject to" the engineers report no matter what documentation was provided by the state because I do not know if my state and FHA are in line with each other. I subscribe to the FHA newsletter and there is currently a proposed change to the foundation requirements which appears to indicate that FHA will defer to each individual states foundation requirements to avoid conflicts but I didn't thoroughly read the whole thing as it was proposed and who knows what changes will be made.
 

Jo Ann Meyer Stratton

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arizona
All FHA manufactured home appraisals are completes "subject to" verification by a licensed engineer that the installation and foundation is in compliance withe the HUD Permanent Foundation Guidelines for Manufactured Housing. Then it becomes the underwriter's responsibility to either find one that has already been completed or arrange for one to be done prior to submitting the binder to FHA. A state approval of the foundation does not mean anything to FHA, even if the state's requirements are more stringent than FHAs. It has to be in compliance with HUD's guidelines.

Do the report "subject to".
 

PropertyEconomics

Elite Member
Joined
Jun 19, 2007
Professional Status
Certified General Appraiser
State
New Mexico
All FHA manufactured home appraisals are completes "subject to" verification by a licensed engineer that the installation and foundation is in compliance withe the HUD Permanent Foundation Guidelines for Manufactured Housing. Then it becomes the underwriter's responsibility to either find one that has already been completed or arrange for one to be done prior to submitting the binder to FHA. A state approval of the foundation does not mean anything to FHA, even if the state's requirements are more stringent than FHAs. It has to be in compliance with HUD's guidelines.

Do the report "subject to".


Mr Marshall ... The EXPERT in manufactured housing appraisal has spoken. I believe you can read Ms Meyer Stratton's post and your answer is complete and your course of action will defined for you.
 
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