changing value

[theresa bialostok]

If you didnt know what the contract price was, what value in that range would you have given. Seems like you didnt think this one through and was trying to come in as close to the contract price as possible. The house is worth what the house is worth. If the property was at the low end of value based on comparable sales then you were right. You see where I'm going with this, meaning was it worth more but you wanted be as close as possible. There are lenders that like it that way but thats not how it works. Be honest to yourself next time around. You may loose a client but not your licence.

 

[stefan olafson]

Let the lender know you were hired to provide an independent opinion of value. As per requirements you were provided a copy of the purchase agreement and you reviewed that in the process of the appraisal assignment. Your opinion of value, as supported by the comparables used and the condition of the property fell in the low end of the range.

What if I sent you an email suggesting that a value of $1,000,000 on that property would insure you receive the bulk of my mortgage business for the forseeable future. What would you do?

Oly in ND Working in MN

 

[Pamela Crowley (Florida)]

What value is that property if the contract was for $150,000?????

What value is that property if the contract was for $1,500,000?????


PLEASE do yourself and everybody else with an appraisal license and HUGE favor. Learn to appraise without any value wanted or contract price looked at. If it's a purchase, AFTER you've finished EVERYTHING else in the appraisal, THEN look over the contract and fill in all the information needed in the appraisal report about that contract.

Do you also do comp checks???

 

[Brockway]

Listen to Pam. It sounds like you appraised the home based on a pre-determined value. Now that the contract price is different you can magically come up with another $30,000? I would not change a thing. It will come back to haunt you. You client will have to order another appraisal.

 

[T.E. Faravelli]

This only goes to show that it is always a lose/lose with MB's. Lose the client for not being a "team player" and upping the value. Lose your license for doing it and perhaps getting caught. Lovely profession isn't it?

 

[Timothy Fierek]

Pamela said it in a nutshell.
Appraise the property for what it is. Seems like you were giving the sales contract too much consideration. I am really surprised that everyone here is being so nice to you.
Very rarely do we do a sale where the value comes in at the contract price or $1,000 more. There are many times it comes in lower, many times it comes in higher.
Your job is not to make the deal happen.
While no one wants to be a deal killer, that is not our concern as appraisers. We are giving an un biased opinion so the lender can decide if the collateral is there for their loan. Not your problem if they have to come to closing with more money. While lenders can do creative financing, appraisers cannot do "creative appraisals." It is what it is.

 

[Mike Kennedy]

Prime Example why, on many occasions, I've stated "it is what it is" REGARDLESS of a contract..........and the requirement for Appraiser Review of a contract is B.S.!!!!!! Revise Guidelines - throw out that requirement and LET'S GET REAL. (urgent request to regulators and lenders alike). "truly independent value opinion" - hogwash - not as long as we are required to do an Attorney and an Underwriters' jobs as well as appraise.

 

[MARK JOLLIFF]

Geez!!! Why not leave the value blank, sign the report and let them fill it in? I see no difference!

 

[T.E. Faravelli]

Very rarely do we do a sale where the value comes in at the contract price or $1,000 more.

I have, literally, hundreds of appraisal reports where the value comes in exactly at the contract price. Moreover, SRS and I tracked residential transactions, back in the day, and we discovered that the appraisal reports values match the contract price 98% of the time. Statistically what do you think the odds are?

 

[Couch Potato]

Raquel, unlike many, I think you may have exercised sound judgment up to this point, but some information is missing. A sales contract is a primary piece of market data, contrary to the way some seem to believe. I think it is quite sound to have it influence the final reconciliation of value. Just like the current listing price and days on the market should be considered in the reconciliation.

Having said that, suddenly producing a different contract at the top end of the value range stinks of attempted fraud. If it were me, I would revise the report to included the "corrected contract," but I would not be altering the opinion of value. The fact that the earlier contract existed still shows the seller was willing to sell at the low end of the value range. A latter contract for more money does not change that fact.