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Asked To Convert FHA Appraisal To Conventional

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ChampRJ

Thread Starter
Freshman Member
Joined
Jan 21, 2006
Professional Status
Certified Residential Appraiser
State
Minnesota
I'm stumped and hopefully someone has experience with this. I recently did an appraisal (within the past 2 weeks) as an FHA. I got a call from the client today asking if I can convert it to conventional because the buyer decided to go conventional on his loan. I've never had this question before and I am wondering if the lender can still use an FHA appraisal for a conventional loan. If not, do I do a new appraisal with a new inspection?
 

Verne Hebert

Senior Member
Joined
Feb 25, 2002
Professional Status
Certified General Appraiser
State
Montana
Get the request in writing. Bill for the conversion. Remove the FHA "stuff" (case number, references to FHA/HUD, MPR requirements--hence the remaining report is a conventional level report. You hopefully, used as much FHA and VA transaction data as available, that is ok.

Your are effectively changing the scope of reporting.

Again, Bill for the conversion.
 

BRCJR

Senior Member
Gold Supporting Member
Joined
Sep 20, 2005
Professional Status
Licensed Appraiser
State
Virginia
I think you have a new assignment with a new SOW. I also think you must check market data for any new pertinent information that may exist.

What you charge is a business decision, I would not, myself, just remove the FHA "stuff".
 

RSW

Elite Member
Joined
Feb 18, 2002
Professional Status
Certified Residential Appraiser
State
Tennessee
Different intended users
Different intended use
Different assignment

I would treat it as a new assigment, go back out, re-inspect the subject property, research for more updated comps, change the effective date and bill them accordingly.
 

Jim Bartley

Senior Member
Joined
Jan 20, 2002
Professional Status
Certified Residential Appraiser
State
Virginia
Different intended users
Different intended use
Different assignment

I would treat it as a new assigment, go back out, re-inspect the subject property, research for more updated comps, change the effective date and bill them accordingly.
I think this is exactly right. If we can't add an intended user, can we remove one? Seems to me that this is a new intended user (lender only as opposed to lender and HUD), and the scope of the work is quite a bit different.
 

ChampRJ

Thread Starter
Freshman Member
Joined
Jan 21, 2006
Professional Status
Certified Residential Appraiser
State
Minnesota
I appreciate the help guys and I think to be safe I'm going to treat it as a new assignment, reinspect and use what I can from the original report.
 

ddnma

Junior Member
Joined
Apr 4, 2008
Professional Status
Certified Residential Appraiser
State
Illinois
I appreciate the help guys and I think to be safe I'm going to treat it as a new assignment, reinspect and use what I can from the original report.
Why do you have to re-inspect?
 

CANative

Elite Member
Joined
Jun 18, 2003
Professional Status
Certified Residential Appraiser
State
California
He doesn't have to reinspect. But it's just better if he does.
 

Eric C

Member
Joined
Jul 25, 2006
Professional Status
Certified Residential Appraiser
State
Florida
I dont agree.

Why re-inspect? for the sake of charging more? wow, good way of keeping your clients.

Besides removing the FHA comments your report shouldnt look any different. So you inspected the attic and other little stuff, great, you already got paid for that either way.

As far as charging a fee is up to you but I wouldnt re-inspect. Just make a new file, new request, leave same effective date and add new signature date.

UNLESS theyre asking for a new effective date but otherwise I dont see it as a big issue.
 
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