• Welcome to AppraisersForum.com, the premier online  community for the discussion of real estate appraisal. Register a free account to be able to post and unlock additional forums and features.

At what point does it go to the State?

Status
Not open for further replies.

Scott McCallum

Thread Starter
Sophomore Member
Joined
May 18, 2006
Professional Status
Certified Residential Appraiser
State
Illinois
So I recieved two review requests, one field, one desktop from a local lender.

One was an FHA of a 2 unit that was on the SF form which is no longer allowed per FHA guidelines. I stated it needed to be completed on the correct form etc...

The second really got under my skin. It was boiler plate throughout. It had a one sentence reference to the property having an in-law arrangement and had the in-law arrangement on the sketch - but did not include interior walls. No statements about, legality, functional utility, etc.... So I went the extra steps to verify the legality of the in-law arrangement. Turns out - it is ILLEGAL. There were so many other errors in the report just from the appraiser being lazy and stating "Similar" for view (despite commercial exposure) for quality (despite full masonry construction vs. aluminum), basement finishings, etc... When I completed the review, I stated that the appraisal was so poorly performed that I would not be comfortable rendering a value conclusion without additional information about the floor plan, costs to remove the in-law arrangement, etc.... I also stated that the presented appraisal needed to be completed subject to the removal of the in-law arrangement as stated by City office.

Okay, I've gone on long enough. Now to my question...Would you, should I, snd this one into the State? Let me know your thoughts
 

TJSum

Elite Member
Joined
Nov 12, 2007
Professional Status
Certified Residential Appraiser
State
Maryland
Did the report have interior photos of the "in-law suite"? Based on your description I doubt it. "In-law suites" can be many things, I would be uncomforable insisting it was illegal without a full blown floor plan with interior walls, or interior photos, or even better a personal inspection myself. Many times skippy calls second full blown units "in-law suites" in order to get around the legal issues (on paper) and avoid using the 2/4 form which they do not understand. But, then again we have seen true in-law suites that are nothing more then a bedroom with a microwave and small dorm size frig. Would that really be illegal in that area??? Usually when you have this situation it is always a great idea to take interior photos to prove the statements on the report. I have no idea about your area, but many areas do allow TRUE in-law suites if that is what it is, especially if the in-law suite is set up in the basement. My suggestion would be to hold off turning into the state unless you have more facts. You could request on your review for the original appraiser to provide interior photos to show what truly is going on with the dwelling.

You did mention, you did not have even info to hazard a value opinion, so that would also cause me to hesitate sending to the State because you are not totally sure about everything regarding the report. Was the value at least in the ballpark????? If it was way out of line, I would try to gather more in-depth info before sending it anywhere.
 

William K

Senior Member
Joined
Sep 21, 2007
Professional Status
Certified Residential Appraiser
State
Illinois
Simple at the point there is a USPAP violation. Most states will not (and should not) get involved with differences in values or adjustments. In almost all instances where value is not reasonably supported there are USPAP violations. Report to state referring to what the violation to USPAP you see is in the report 1st, then you can refer to additional inconsistencies that you may have discovered.
 

leelansford

Elite Member
Joined
Mar 29, 2002
Professional Status
Certified Residential Appraiser
State
Illinois
...
Okay, I've gone on long enough. Now to my question...Would you, should I, snd this one into the State? Let me know your thoughts

If not this appraisal, what would be worthy of directing to the regulatory agency?

Direct it to IDFPR, Appraisal Admin. Div., Chicago (you can obtain the full address at IDFPR's website).

Include a brief but specific synopsis of the deficiencies that you found in the appraisal.
 

Fred

Elite Member
Joined
Jan 15, 2002
Professional Status
Retired Appraiser
State
Virgin Islands
Simple at the point there is a USPAP violation
As long as you recognize that not every alleged "violation" is a "substantial error" that has a "significant effect" on the appraisal; that not every so-called "violation" makes the result not credible for the intended use.
 

leelansford

Elite Member
Joined
Mar 29, 2002
Professional Status
Certified Residential Appraiser
State
Illinois
As long as you recognize that not every alleged "violation" is a "substantial error" that has a "significant effect" on the appraisal; that not every so-called "violation" makes the result not credible for the intended use.

Steven,

Yes, but as SR 2-1 states:

"Each written or oral real property appraisal report must:

(a) clearly and accurately set forth the appraisal in a manner that will not be misleading;

(b) contain sufficient information to enable the intended users of the appraisal to understand the report properly"

My reading of what the original poster offered regarding the appraisal of the property with the "in-law" certainly raises some questions in my mind whether or not the above expectations have been met. Are these what you were addressing in your response?

Lee

Just a thought.
 

Brad Ellis

Senior Member
Joined
Feb 7, 2006
Professional Status
Certified Residential Appraiser
State
California
Scott,

When you checked on the legality of it did you tell the city when the in-law was added? That is important since many cities NOW do not allow them but the overwhelming majority of these were fully legal during the biggest period of their development right after WWII.

Actually, do you even know when the in-law unit was built?

Had one of these a couple of months back and when I asked the reviewr how he knoew whne the unit was built or carved out he responded that he knew when it ws built because he went to city hall and pulled the permits!!!!!!! :rof: :rof: :rof:

Brad
 

Jim Onderisin

Senior Member
Joined
Sep 15, 2003
Professional Status
Certified Residential Appraiser
State
Illinois
Lee...how do you know the subject property is located in Illinois? Does it matter?
 

leelansford

Elite Member
Joined
Mar 29, 2002
Professional Status
Certified Residential Appraiser
State
Illinois
Lee...how do you know the subject property is located in Illinois? Does it matter?

I surmised the location in Illinois from (a) the poster being in IL and (b) the poster stating that the review requests came from "a local lender". Of course, my assumption may be erroneous, but the advice (other than sending the complaint to the IL state agency) otherwise does not change.
 

William K

Senior Member
Joined
Sep 21, 2007
Professional Status
Certified Residential Appraiser
State
Illinois
As long as you recognize that not every alleged "violation" is a "substantial error" that has a "significant effect" on the appraisal; that not every so-called "violation" makes the result not credible for the intended use.

Steven,
I am surprised you used the word "alleged". If we are to assume the facts to be correct then there is a violation. I feel your statement is correct in that not all USPAP Violations raise to the degree of " substantial error" that have a "significant effect" on the appraisal results. That being said my response was to the initial Heading of "At what point does it go to the State?". So many times review appraisers feel a difference in opinions ( lack of interior walls on a sketch being just one ) rises to the level of reporting an appraiser/appraisal to the state. I feel the criteria of a Violation of USPAP is when it could ( could not should) then be reported. IMHO it is the state boards decision to determine does it rise to having a "significant effect" on the appraisal results. I am sure you will agree that it is very easy to have a "Violation of USPAP" that has no effect on the appraisal results but a state board will still issue a warning or assess a fine for an infraction so as to inform (educate) the offending appraiser to take more time with their appraisal reports.
 
Status
Not open for further replies.
Find a Real Estate Appraiser - Enter Zip Code

Copyright © 2000-, AppraisersForum.com, All Rights Reserved
AppraisersForum.com is proudly hosted by the folks at
AppraiserSites.com
Top

AdBlock Detected

We get it, advertisements are annoying!

Sure, ad-blocking software does a great job at blocking ads, but it also blocks useful features of our website. For the best site experience please disable your AdBlocker.

I've Disabled AdBlock
No Thanks