Bankruptcy appraisal

[Bamba]

I received a request from a homeowner to do an appraisal on his home for bankruptcy advised by his attorney (prior to file action). I have never done one and I'm a bit worried about what it involves. Will I have to go to court for this?

I've searched the forum but I didn't find too much info on bankruptcy appraisals. Should the comps selection be any different than for a refinance appraisal?

Is there a conflict if I was engaged by the homeowner and not by the attorney?

I need help please!

 

[PropertyEconomics]

A bankruptcy appraisal is typically conducted allow the bankruptcy trustee to calculate the amount of equity in the home for bankruptcy settlement purposes. It should be a typical market value appraisal which has a purpose of establishing market value for purposes of bankruptcy proceedings.
I personally would ask the attorney who your client should be, but I have done these in the past for property owners and have never had a problem.
Put them on a general purpose form and make sure the value to which you are appraising, which I do believe is market value. I have not ever had to appear in court as a result of a bankruptcy appraisal, however, that is not to say that it cannot happen. Be sure when doing an appraisal like this you have very thoroughly analized the data, that all your adjustments are well supported, that your final value conclusion is reasonable and also well supported, and that you get paid UP FRONT to do this assignment.

I wish you well.

 

[Bamba]

That is what I was thinking...typical market value...homeowner said to make the appraisal in his name. what general purpose form to report this?
I am trying to analyze my comps over and over again and the adjustments as well... I did get paid up front and cashed the check (homeowner actually told me to cash it asap)

 

[PropertyEconomics]

I dont know what software system you have but there are general purpose appraisal reports that you can use. They lack the langauge of being for mortgage finance transactions .. which this is not.
AI has a general purpose form as does the ACI software system which are call GPAR .. General Purpose Appraisal Reports.

 

[realbiz]

A bankruptcy appraisal is typically conducted allow the bankruptcy trustee to calculate the amount of equity in the home for bankruptcy settlement purposes. It should be a typical market value appraisal which has a purpose of establishing market value for purposes of bankruptcy proceedings.
I personally would ask the attorney who your client should be, but I have done these in the past for property owners and have never had a problem.
Put them on a general purpose form and make sure the value to which you are appraising, which I do believe is market value. I have not ever had to appear in court as a result of a bankruptcy appraisal, however, that is not to say that it cannot happen. Be sure when doing an appraisal like this you have very thoroughly analized the data, that all your adjustments are well supported, that your final value conclusion is reasonable and also well supported, and that you get paid UP FRONT to do this assignment.

I wish you well.

Well said above, the only other tip I have is to make payment cash, money order, etc. Last one I did check bounced, but I did not release the appraisal until he made the funds good. The man was in BK, so I was going to make sure the check cleared which I told him up front (still bounced).m2:

 

[Bamba]

I'm using ACI. I found gPAR single family 2006 (residential appraisal report) and also gPAR flex 2007 which is a restricted residential appraisal....i guess I'm going to go with the first one...

Should I add the attorney under additional intended users?

thanks PropertyEconomics for your help!

 

[Bamba]

I already cashed the check at his bank and deposit the money in my business account.

 

[PropertyEconomics]

Bamba .. Id use the GPAR 2006 .. its very much like the typical fannie form ... and it works well in assignments like you have.

Do a great job .. you will have no problems

Also as an aside, if you have to appear before the bankruptcy trustee (court) its not really like any court you may have been in before or any that you typically associate with court. It is a meeting with yourself and the trustee, on record and they ask you questions and you simply answer them. Nothing really to be nervous about. I have appeared at several bankruptcy proceedings in the past but typically as a creditor and I have watched how these proceedings work. Nothing really to be too frightened of .. they are nice people simply doing a job. They are not trying to catch you in anything, they are simply trying to find answers to questions they may have.

Im sure you will do a good job.

 

[Bamba]

Thank you so much!! I was fine until he told me that he had an appraiser refused to do his appraisal because she was too scared to go to court...and that made me wonder if I should run also

 

[Bama Bayou]

You have been given good advice so far on this thread, congratulations. I testified in bankruptcy court many times when I had a courthouse square office. It is somewhat informal and your appearance, if necessary, will most likely just to be put on record. No big deal, just do your usual high quality work.

Charge for court time and make them pay cash before you appear. Don't be cheap about your time either, it will most likely take an entire AM or PM. Not to testify, that will take about five minutes. Driving and waiting are the main time drags. Bring your business cards because there are usually a whole bunch of lawyers around and believe me they need appraisals in this market.

The only person of concern to you in this court will be the judge and they are just looking for an honest appraisal so they can plug the numbers in. An experienced judge will know a great deal about appraisals, which is a good thing. You will not be grilled, just asked some questions.

Good luck. It's been years since I have been in court because I now live almost two hours from the county seat. I thought it was kind of fun and it's great for business.

If you do this a few times before the same judge it becomes very easy. I had one bankruptcy judge consult with me about his personal real estate deals after testifying is his court several times. Made several nice commissions, and I can't tell you how many referrals I got from this one judge.