Appraising A Property Being Used For Illicit Purposes

[Peter LeQuire]

Is it being used by immoral porpoises?

Regardless of the "illicit" use - if you wind up making an allegation that is proven not to be true, you could be in a most uncomfortable position.

 

[gregb]

Those illicit chickens in Little Rock probably would bring more scrutiny than an appraiser using a 1990's adjustment checklist.

http://www.aymag.com/p-allen-smith-backyard-chickens/

 

[Vermonter]

Unless we're talking about a zoning violation, probably not a good idea to make assumptions on "legality". I would explain what you saw to the client and go from there.

 

[glenn walker]

You are in California and hopefully you are located in some dinky rural community , in the Los Angeles or Southern California area you may end up dead or worse bankrupted with making accusations on so called illicit use against a property owner . You are not the police and your job is to appraise property and unless there is clear evidence of something like child or animal abuse you will be toast . Never accuse somebody of a illicit use because it may not be a big issue at all to the police or court system . A good California attorney will make your life miserable. I would suggest you just appraise real estate or become a priest but in California you may be too tightly wound or conservative and you really believe the system is on your side .

*** Remember you are entering a persons private property and their personal residence or business and are now acting as if you had a search warrant . I would highly recommend you not get involved before you get legal council and in your case contact your E & O carriers legal department because they are the ones that will have to defend you in the event the borrower or lender files a lawsuit against you for invasion of privacy or possible false accusations and damages . No matter what you most likely will end up as the loser because nobody is going to fall on the sword for a California Appraiser : ) LOL

 

[Restrain]

We did a home, had rooms that all opened on the pool, OK, no problem. But them there was the Mster Bedroom that had an oversized bed, on platform, with mirrors and a lot of electrical plugs. Appears to have been used as a 'movie' studio.

 

[Bobby Bucks]

So, if I see a cockfighting ring in the backyard with signs of recent activity, should I narc on the owner, look the other way or have the order reassigned to someone who would think it's just an oversized yuppie campfire pit?

 

[J Grant]

A person uses their own premises for a sleazy use (home **** movies) or illegal use (backyard dog fighting) is icky but whether rises of level of reporting...I'd ignore a sleazy use, might report to authorities a use harming animals or kids and give up appraising that house as conflict of interest. A criminal use such as grow house in garage should be discussed with lender, one might want to withdraw based on such even if property could still be appraised.

A property converted physically such as interior carved up into little rental units for illegal use is another matter still. Unless OP comes back to clarify who knows...

 

[Ken B]

If I open a closet and there is a mini grow operation going on and there is someone in the house lying in bed with a DNR taped to the door, I would take a pic of the closet and advise the client of my concerns regarding the nature of the use of the closet while saying a little prayer of thanks for the health of my family and myself.

If I open the freezer in the garage and there is a human head sans body staring at me, I am leaving immediately and calling the police.

Hope that helps.

 

[VolcanoLvr]

I'm in the camp saying contact the client before proceeding with the appraisal. Until you do that, you don't know what their lending policy/guidelines are, or what they may be concerned about.

In certain cases, contact with legal authorities may be warranted.

You probably will be asked to be very specific as to what you observed. In some cases, you might even be asked to provide exterior photos at the very minimum to reveal what was observed.

A vast majority of our assignments are for mortgage lending purposes. As such, we appraisers are the eyes/ears for the lender. I'm constantly amazed by the number of responders who ignorantly recommend appraisers just appraise the real estate and disregard 'illicit' or 'unlawful' activity that may be in evidence on the property. Doing so has the potential to hide fraud or crimes that may be occurring. The appraiser then becomes complicit.

One really must be willing to turn inward and examine these kinds of situations ethically. Decline any assignment where there is any hint of gut churning, and let some other person deal with it.

 

[Tim The Enchanter]

Decline any assignment where there is any hint of gut churning,

I'll decline that lunch at Arbys then.