Average versus Fair condition

[milehigh]

I just need an opinion here. I appraised a bank owned property. The exterior of the property was in fair to average condition. No repairs needed - just some minor peeling paint and clean up. The interior was in below average condition. There were half a dozen fist sized holes in the drywall. The carpet was extensively and severely stained and worn. Two of the hollow core doors had basketball sized holes in them. There were leaks in two fixtures. The paint was very worn and even had spray painted grafetti on them. All of the appliances had been removed. Molding has worn, peeling paint. Some molding was torn out and missing.

I rated this home in fair condition. I have had the mortgage originator, the buyer and even the lender trying to pressure me into changing this to average condition. They are trying to tell me the home should be rated as average. The subject neighborhood is a nice area with most homes in average to good condition.

The interior of this home is one of the worst I have seen. I'm I out of touch with reality - should a home is this condition be rated as average!

Thanks for your input

 

[Em Tee]

Do you really have to ask? Stick to your guns and don't let them pressure you!!!

:new_2gunsfiring_v1:

 

[David Dietz]

Definitely do not change it, in fact just my opinion which is not worth much that home sounds like Poor condition to me. You were very kind in just giving a fair condition.

 

[Tim Hicks (Texas)]

Fair condition and give them a cost to cure, too! Then they will really holler when the underwriter requires the repairs.

It is what it is. I know some lenders that are lending on these type properties, but most brokers that are selling their loans can't seem to get the wholesale underwriters to ignore the condition.

 

[Krystal Schware]

From what you've said, it sounds like it is truly fair condition. "It is what it it is" and it IS fair condition. The only other option would be...and this is just a thought...would be to ask them to bring it to average and tell them what repairs to do to get it there. If they want it bad enough and are willing to make the repairs, then make the appraisal average BUT subject to a, b, and c repairs being complete. Or, if time and seller allow, let them make the repairs pre-settlement then go back out for a walk-through and make sure they were done in a proper manner....then you could appraise it as average. If they have to push settlement back, then unfortunately that is their problem and not yours.

 

[Lee Lansford]

I just need an opinion here... The interior of this home is one of the worst I have seen. I'm I out of touch with reality - should a home is this condition be rated as average!

Thanks for your input

To answer your question: No.

You were obligated to provide an accurate and complete description of the improvements as they exist and, following, rate the "condition" vs. neighborhood housing in general. It appears to me that you have done this (both would appear to justify ratings of "fair").

Move on to your next assignment.

 

[alex gilbert]

Tell 'em its in Fair condition and reference your interior photos (you do have interior photos, yes?). Also offer to prepare, for a reasonable add'l fee, an appraisal made "subject to" repairs that would show the property in average condition.

 

[Lobo Fan]

I had one this week that was kind of a tweener. It was bachelor pad dirty, some minor repair items, but mostly just dirty. I was thinking about calling it fair, but decided to let it slide. Took lots of pictures. I love those 6 pack photo addendums.

My advice is stick to your guns and get as much in writing as you can. This is exactly the sort of thing we need protection from. Next wll be change it or we won't pay you for a "worthless" appraisal. *******s.

 

[matt t]

I recently worked on a bank-owned assignment with my dad that was similar to yours. This assignment was a purchase for a regional bank client, though, not a MB trying to sell the loan wholesale.

The other differences, besides the client, were that the graffiti was on the exterior of the property, not the interior and that instead of leaky sinks, the wainscoting (cheap tiles) were falling off around the tub/shower unit. Oh, I might add that the enclosed patio had about 1/2 of the glass panels broken out and was boarded up with partical board that was painted with graffiti as well. Those are just a few of the low-lights, there are many more.

In the report, the condition was noted as poor and adjusted for in the grid and the value provided was "as-is." Both interior and exterior photos were included in the report for all to see.

Of course the lender declined to loan based on condition and the borrower and his realtor were pretty upset...to put it midly. The realtor, in a series of unprofessional phone calls, stopped just shy of pressing for the condition to be changed to average and the borrower called threatening to report it to the State Board for, of all things, discriminaton. We have no idea who he is, by-the-way. Oh, and the realtor admitted on the phone that she wasn't even aware of the graffiti on the back of the house until she heard about the report. She stated that there was too much snow on the ground when she showed it and she didn't want to walk around.

The call to the State by the borrower hasn't taken place yet, but my dad did call a VP at the real estate office last week. This guy had been my dad's boss at this very same office in the mid-eighties when he used to sell real estate. My dad very politely told the VP that one of his agents was acting in a very un-professional manner. Just yesterday, he got a 1.5 page apology letter from the agent. Neither he nor I expected that to happen.

Anyway, just wanted to share my story as it sounded kind of similar to yours. I'd suggest standing your ground, though, and best of luck to you!

 

[TJSum]

Interior photos are the key, once the MB/LO sees the interior photos, they don't even waste time with trying to get you to reword your report