Borrower Lying About Occupancy Status

[Carnivore]

Barry,

You attention please to page four, Scope of Work paragraph of the 1004 ver 3/05.

I did not make this up and I am not in a position to change the SOW.

 

[Webbed Feet]

Mr. Picarsic,

I appreciate your position and hope we have a friendly and spirited debate going here! .. Thought I should say so...

I know you are looking at "and reporting requirements of this appraisal report form," in the SOW... But your interpretation of that and mine are completely different. Another weakness in the Fannie forms and her supporting documents, or lack of them we can say.

For example, taken literally the address boxes would require an address. What about properties that do not have an assigned address at the effective date? .. We then use something else to identify the property, not an address. .. But you seem to be saying the SOW implies we cannot do that.. I suppose areas lacking official "Neigborhood Names" could not be appraised since we therefore could not comply with the SOW regarding that?

Sorry, but I do not take every little information and checkbox header to mean it rises to an exact SOW matter on these forms. If I did there would be all sorts of cases where myself, and all of us, would have to declare the report cannot be completed due to missing, but required under the SOW, form information. Again, I take my reporting requirements from USPAP and signed certifications. It's my belief those are what the SOW is mostly referring to. Otherwise, we are again into hopeless debate what is "Urban", what is "Suburban", and what is "Rural." In fact, I think we are.

Mr. Watland,

Glad you joined in! Now define "Vacant" for us. When a property buyer is handed the keys to a house, opens the door and walks in, is it still "Vacant" or is it "Owner Occupied"? .. It seems to me he just took possession of the real estate... If he walks out again for three days while painters come in before the furnature is it vacant? What if the new owner uses the garage for storage immediately but has not actually put stuff in the house because it is being bug bombed first?.. Exactly, what is the defining moment a house goes from "Vacant" to occupied as used for lending and appraising? .. Who is the authority on that and what did they decide? I've missed it in all my CE classes.

I'm probably just being a pain this morning and should shut up..

Barry Dayton

 

[Otis Key]

Borrower Lying About Occupancy Status

Like that's a first time? Surprised no one mentioned that before. :new_2gunsfiring_v1:

I really hate to end arguments, but just put these definitions in your scope:

Subject section-Occupancy: Owner box and tenant box are checked per information supplied by client. Vacant box checked per observation by appraiser at time of inspection.

Another way to put it: Lender's declaration of occupancy status accepted for report purposes. Appraiser will note if subject is clearly vacated at time of inspection.

For the timid: If unit occupancy is not clear, appraiser may supply interior photos to aid UW in drawing a conclusion.

All fine and dandy Roger, except (hehehehehe - you knew someone would pull the old "appraiser trick" out of the bag). I did an appraisal not long ago. I had appraised this house twice. The first time the owner was going through a divorce and the wife was going to live there and he still had clothes there. Same thing the second time, same MB.

Third time it comes around and the divorce is final. ORDER comes across as "owner occupied". However, the male has since remarried (guess he was in a hurry) and now owns a property (residence in another town with a different telephone prefix) and in the general conversation he indicates to me that he loves living in the country (first house in the middle of the a "stamp sized lot" development. Ex-wife living in the house. It's NOT owner occupied to me. He is shown as the owner of record; he is shown as having the last mortgage on the "ex-wife occupied" residence; he is shown as the mortgage holder for the "country residence"; taxes for the country residence indicate that the gets the "head of household" exemption.

The MB had a fit when I marked it as tenant - had to - I don't know what the terms of the agreement are (none of my business) but she is not on the title, mortgage or any other documents for that property. My last statement from me to the MB was provide me proof that he lived there and I will mark it as "owner occupied".

 

[Mike Kennedy]

Oooooooooooo.......I LIKE that! Done ---- it goes out Monday. Thanks!

If you use it ........send it to the LENDER, let THEM forward it to the borrower. :icon_idea:

 

[Webbed Feet]

<snip>Edit: Hang on here....isn't an extraordinary assumption something that would, if found to be contrary, affect the results of our appraisal??? Occupancy of the borrower has no effect on my value. Just food for thought. Anyone??

Ms. Platt,

First blush I think you have a good statement about that. ..

Mr. DeSaix,

I think we are in harmony too... LOL.

I just don't see this topic as under the S.S. Rule. If it is then I would have to say we are all obligated to personally verify, or with a disinterested third party, the information. We don't need to because as Ms. Platt points out, were is the affect on the analysis, excepting missing a hidden leased fee situation. I believe, as Mr. Watland suggests, that "The Client Said" is pretty much the standard of the trade unless we are slapped in the face with vacancy and for rent signs in the front yard.

So yes, I agree if things are blatent, like the occupant out and out says to you "I've been renting here for five years, you're not here because the owner is selling are you?" .... (LOL Busted!) .... It has to be reported. .. But checking "tenant" based on wild guesses about it based on appearances and the appraiser's subjective view of things only? ... That could blow up into a discrimination claim these days and certainly does seem to appear under an S.S.

Not an easy situation to be placed in.

 

[Carnivore]

If you use it ........send it to the LENDER, let THEM forward it to the borrower. :icon_idea:

This is the best solution!! Then ask the lender to send it back to you for YOUR FILE.

CYA!

Pricing of products is whats driving this. Rogetr does not want a nosey appraiser telling his funding source the truth other wise the cost of the money goes up on the borrower. Plus, that 100% owner occupied loan disappears.

CYA! Mortgage fraud is rampant. Mortgage losses are staggering.

If you were Brad Ellis, what would want from the appraiser?

 

[John Papa]

Call the client and ask for a copy of the executed occupancy statement/affidavit. Or you can place an asterik in the tenant-occupied box and then disclose in your report that you are unable to determine the occupancy status, because public records indicates a different tax mailing address and there has not been homestead exemption recorded. Let the underwriter determine the true nature of the occupancy.

 

[Pat Butler]

When in doubt I call the lender and ask for the page of their loan app where they have indicated their own occupancy.

I then report that I could not independatly verify occupancy and am relying upon the borrower's own statement. I would also list any facts that I am aware of such as their mailing address, whether or not they were present at the property, homestead issues.

 

[Joanne Rauenzahn]

Joanne-

May I clone you and then infiltrate you into all my clients?:new_smile-l:

Denis --- YES if one of me can then retire and another gets a big increase in pay!
I need to move somewhere warmer anyways

 

[JSmith43]

Rogetr does not want a nosey appraiser telling his funding source the truth other wise the cost of the money goes up on the borrower.

I object to the spelling and the implication. There is no way I want to be the party to a misrepresentation of occupancy.

For goodness sakes, I do what I can to out slippery LO practices on this site