Are we required to obtain permits?

[23Degrees]

My certification states I am not not responsible for things of a legal nature.

I wish I had the option to use that certification in my lending work. That would solve everything.

If one uses the GSE forms the certification states:

The appraiser will not be responsible for matters of a legal nature that affect either the property being appraised or the title to it, except for information that he or she became aware of during the research involved in performing this appraisal. The appraiser assumes that the title is good and marketable and will not render any opinions about the title.

And if one runs into readily observable discrepancies that run counter to what public records (where relevant) indicate or obvious anomalies such as a garage apartment during the course of their research, then one just gained responsibility per the certification or at least cannot argue that they bear no responsibility for that issue.

Checking "legal" and "as is" in these situations within the jurisdictions represented in Kennedy's posts is contradictory. Boilerplate BS is not going to get anyone off the hook when it comes to statement 1. Statement 1 will protect an appraiser that appraised a home that was issued permits by the city and later found to have had faulty electrical work not up to code. The jurisdiction that issued the permit owns that call, not the appraiser. Does anyone else see that the goal here is to not be the "permit police" and to not own these calls. You check "legal" and "as is" in these situations and you own the call.

Using El Paso County as an example - if someone can tell us that one can build an entire SFR on an R1 lot without the benefit of permits and the appraiser will still be able to legitimately check "legal" for the zoning compliance question simply because they showed up, there was an SFR on a lot where an SFR is legally permissible (but not legally built) then maybe there is an argument here. Tell us that there would be no worries from a burned client, a burned GSE, or a burned buyer with a shark lawyer that the appraiser that checked "legal" and "as is" here is all cozy and safe because they cited in some addendum that the fact that it was built or might have been built without the benefit of building permits is not their problem.

Do that and we can end this argument once and for all, Mike can stop posting evidence refuting anyone's claim that it does not matter where they live, and we can go back to reading posts complaining about AMC's. Until then playing the "legal", "as is", "cost to cure" game with much of this stuff has just been a way to keep clients happy and help them facilitate the selling of loans to the GSE's in what is either a misinformed or misleading manner.

 

[Terrel L. Shields]

Under your assumption then appraisers can be held for hidden defects (termites perhaps?), sloppy work (recall the houses in Florida after Hurricane Andrew that were "approved" but had insufficient nails in the decking, lacked hurricane anchors, and sheetrock was used as substitutes for plywood on gable ends??)

As permit police, we need an inspectors license and training sans kickbacks??

There is also something about the lenders responsibilty to provide information that they know. There is also the issue of uncooperative or unknowing permit conditions because the city clerk or whomever may not know what the planning board approved or did not, and the results of such approvals may be buried deep in the minutes of some long forgotten meeting. The idea that this information is simply sitting on a table at the planning board waiting for you to show up and/or is clearly delineated and provided in a simply address on line search??? Me no tink so. During the normal course of business it is rarely available in these parts. Further, to get that information may take days...weeks.

The same applies to poultry farms I do. They may have permission from the state to drill a deep water well or they may have been denied or just as likely they never asked...and were never informed they couldn't. There are environmental issues in certain watersheds and in private settlements between Tulsa and some poultry companies, those companies have to "do" certain things. It's pretty hard to find a copy of that agreement. It's even harder to determine if the particular farm in question (many in neighboring Arkansas) is required to comply with it. And some poultry companies were never added to the suit and are not subject to it. That was years ago...Where do you go for that information? How long do you think it would take for the city of Tulsa to get back to you on it? 2 weeks? Never?

In the normal course of business, my peers do not do such detailed searches except with there is a clear violation and that information is readily available.

 

[23Degrees]

Under your assumption then appraisers can be held for hidden defects (termites perhaps?), sloppy work (recall the houses in Florida after Hurricane Andrew that were "approved" but had insufficient nails in the decking, lacked hurricane anchors, and sheetrock was used as substitutes for plywood on gable ends??)
\

Sorry but the above description of my position is absolutely the exact opposite of where I stand. You have either not read my posts or do not understand my position as it relates to readily observable deviations from public records or obvious anomalies (ie: garage apartments), Statement 1, the zoning compliance question, and the options available to appraisers in the reconciliation section of the forms.

 

[PropertyEconomics]

One of the biggest issues that is never addressed in these threads is the difference between being a "permissible use" vs a "paper permitted use" .... they are vastly different.

 

[CANative]

One of the biggest issues that is never addressed in these threads is the difference between being a "permissible use" vs a "paper permitted use" .... they are vastly different.

I think two of us in this thread brought this up. Or maybe I don't understand what you mean.

 

[23Degrees]

One of the biggest issues that is never addressed in these threads is the difference between being a "permissible use" vs a "paper permitted use" .... they are vastly different.

They certainly are. The distinction was noted in post #61. And the scenario that is yet to be addressed by the "not my problem", "legal", "as is", "cost to cure" crowd displays it in pretty vivid contrast.

The "legally permissible" or "permissible use" issue is addressed in the "HBU" question which is the next question on the GSE form.

If anyone is arguing that just because a use, SFR, is a permissible use, then it automatically means that the zoning compliance question can be checked in the affirmative, even in cases where the property was not built with permits in areas where zoning code requires it, then go ahead, make that argument. Please proceed and address the scenario presented in post 61 and tell us "don't worry, be happy" and check the "legal" and "as is" boxes no matter what bootlegged, ridiculously apparent situation you run into as long as you can still technically call it an SFR.

 

[Lee Lansford]

One of the biggest issues that is never addressed in these threads is the difference between being a "permissible use" vs a "paper permitted use" .... they are vastly different.

Thank you.

 

[Lee Lansford]

For those who are the permit police, come to Chicago and appraise (by way of an easy example) a few bungalows with attics that were finished (permit or not) in the 1930s. Enjoy.

 

[Webbed Feet]

Pros take responsibility, they don't disclaim it.

If you want to be the permit police then dont be surprised to one day to be sued by a homeowner because YOU called down to the town zoning department and opened up a "can of worms" that will never be closed....

..not only that, but you are discussing confidential information about the subject property with someone (the town) who is not your client.

You ARE not, and SHOULD not be the permit police. But, if you are...good luck with that...its beyond your scope, why put yourself in the crosshair ???

I was going to wait and read the entire thread before posting, but this kind of emotional fear mongering that impedes the path to professionalism for our trade is outrageous.

To appraisers reading this thread and wanting to learn. The above view of the responsibilities of real estate appraisers is seriously dangerous to your license if you adopt it. You see, taking responsibility to create well researched appraisal reports, that have meaning in the real world, takes time. Whereas taking an "it ain't my responsibility" attitude works nicely for turning a number of your reports into state appraisal board time bombs.

What is the real danger in taking the above attitude that quality research and reporting will get you sued or reveal "confidential" information (untrue), is outside a SoW, and will put you in a "cross hair" of some type? Well, what that kind of thinking gets appraisers into is completely missing, and failing to report, that a subject property has seriously illegal aspects to it and leads an appraiser right into signing a misleading appraisal report with no credibility whatsoever. What does that get the appraiser when someone like myself sees a copy of their report and, as often happens, is asked to reappraise the property?

The answer is the involved appraiser's report issues could end up being the poster boy for a brand new state appraisal board CE course for what NOT to do as a real estate appraiser. Especially, if you ever want to actually be able to ever mentor another appraiser ever again, don't want to pay large fines, or have to defend against a board complaint where you crash and burn while trying.

 

[Webbed Feet]

For those who are the permit police, come to Chicago and appraise (by way of an easy example) a few bungalows with attics that were finished (permit or not) in the 1930s. Enjoy.

Brother Lansford,

I view your above as smoke and mirrors, and beside the point. Most all cities have trigger points in time where prior to a certain date no permits were required and after that, or those, dates permits and building to codes were required. Appraisers working as "experts" in those locations need to know those dates and need to be able to recognize all the vagaries of the markets they are hired to interpret.

Any appraiser, on either side of this debate, that takes a cemented stance on either end of the 180 degrees of this topic is firmly planted in the wrong place. There is only one correct answer, and that answer is stay firmly planted right in the middle of the topic with a very positive "That depends" answer.

Refusing to do the research when it needs to be done is a giant mistake. Knowing when to do it comes from good training and appraisal wisdom. The coining of the derogatory phrase "permit police," by appraisers to use against other appraisers, is a disservice to any and all upcoming appraisers that need to be taught what it takes to be a real estate appraiser.