Claims Without Conveyance of Title Properties

[Mile High Trout]

I did a ton of pre foreclosures for a servicing co. How do you know that this has been foreclosed on already. At that point they have a realtor involved and want a real interior appraisal done. They don't need a drive by when they have taken it.

For a pre foreclosure:
1. they stated to put on the report, "not for lending purposes". The reason is that every year they have to post properties where value is below loan amount, as a loss on their books. And they do not like that.
2. i used the generic 2055 form with a REO addendum. since i never saw the inside of the house, what could you say about item condition, they wanted 'average'. So stated 'average', but on the low side average value range, knowing they would all be beat up when evicted. I also stated, the value could be dramatically different if not in the assumed stated report condition.
3. The 1004 is for a loan appraisal, it's stated on the form. You get in state trouble when the appraisal isn't for a loan, using the 1004.
4. i had a large data base from doing so many in the same zip codes that i could do them very fast. But just doing 1 is way more work that you will get paid for it, especially with the REO addendum added.

INTENDED USER OF THIS APPRAISAL REPORT IS THE CLIENT NOTED IN THIS REPORT. THE INTENDED USE, THAT IS THE SUBJECT OF THIS APPRAISAL, IS TO DETERMINE INTERNAL MARKET VALUE FOR CLIENT, NOT FOR LOAN ORIGINATION.

NO ADDITIONAL INTENDED USERS ARE IDENTIFIED BY THE APPRAISER. ANY OTHER PARTY RECEIVING A COPY OF THIS REPORT FOR ANY REASON IS NOT INTENDED USER; NOR DOES RECEIVING A COPY OF THIS REPORT RESULT IN AN APPRAISER-CLIENT RELATIONSHIP. USE OF THIS REPORT BY ANY OTHER PARTY(IES) IS NOT INTENDED BY THE APPRAISER.

NO INTERIOR INSPECTION WAS MADE, APPRAISER ASSUMES UTILITIES ARE ON, FUNCTIONING. NO APPARENT STRUCTURAL DEFECTS. MECHANICAL SYSTEMS ARE IN WORKING ORDER, FUNCTIONING. APPLIANCES ON, BUILT-INS & KIT CABINETS FUNCTIONING. ADEQUATE ELECTRIC SERVICE. HEAT SOURCE IS PERMANENTLY ATTACHED. THE DWELLING IS ASSUMED TO BE IN AVERAGE CONDITION WITH UTILITIES ON & FUNCTIONING. Any difference from these assumptions may negatively, or positively affect the value. This is an extraordinary assumption: an assignment-specific assumption, as of the effective date regarding uncertain information used in an analysis, which if found to be false, could alter the appraiser’s opinions or conclusions.

All right Tom. Who's pushing that work? All the old service and asset managers are moving to ridiculous products like appraiser certified BPO's, hybrids, etc. I can't seem to locate anyone outside of government direct that is still pushing full REO for asset management. PM me some names if you get a sec, could use a few. I landed a few AMC's who were bidding and I back out right away, never broke the 8 year long AMC streak. I'd work with a few AMC's, if they had direct assignment at consistent fees, for REO exclusively. I don't know if there are any of those left, I seriously doubt it. Homeogeneous, lsi, all of them, screwed things up big time with alternative valuation programs. Now it's all note sales and debt sales anyways. REO agents are busy, REO appraisers not so much. Agents tell me they're getting all the work we used to get, drive by's, no value, completion progress, all of that.

 

[Tom D]

2055 on a pre foreclosure means do that sht in the middle of a weekday so you don't get shot being on their property. I will not take those orders. Only accept full REO after eviction has happened.

They've already been served the papers but have not yet left. That's where the drive by form comes into play. They're hoping for last ditch effort to restructure the loan or the lender is checking if it's even worth it to foreclose.

I did a ton for the mort servicing co, they were only drive by. Full REO was long, long ago. They paid decently, then they all went down hill. But even then, too much work for a normal fee. Never did see more $ for a 1004 & REO addendum.

Drive by, I got to the point of not getting out of the car for the front drive by shot. Did the street shot from the front car window, opened the car door, stepped out a second and did the other street view. Took pictures of the subject and view across the st just by sticking my camera out both windows. I do not do interior REO any more, not worth the time pay, ever. At some point in this big city getto REO, i started to carry a small 22 pistol, some of the streets looked ruff. My car cost more than the houses. But never had an issue, just some scary streets. And always early morning, while the junkies were sleeping.

 

[Cob]

Assignment type is a FHA 2055 exterior only on a foreclosed FHA-insured home. I know the appraisal is "as is". Client wants to know if it meets FHA MPR's. How would I know this if it is a 2055 only?

If it's for a pre foreclosure, then the original loan on the property was an FHA loan, your assigment is for a 2055 Exterior appraisal, that is more than likely not to service the original loan, which was an FHA loan, talk to the client and have them explain in more detail what the assigment is, as I am pretty sure they aren't aware that for what they need, they don't need to know if the property, in its current state needs to meet FHA MPR's.

 

[Mike Ault]

Assignment type is a FHA 2055 exterior only on a foreclosed FHA-insured home. I know the appraisal is "as is". Client wants to know if it meets FHA MPR's. How would I know this if it is a 2055 only?

The same way you know everything else about the property, what you are able to determine from your limited scope of work. If you don't see any MPR items from a visual exterior inspection from the street, then as far as you know "yes it does". If you note an MPR requirement from the street or discover some other latent defect online, indicate "no it doesn't" and provide the estimated cost to repair the issue. I've done a bunch of these and you can count on your client being aware of the limitations of the assignment. You should also place the following verbiage somewhere in your report for CWCOT assignments "The purpose of this appraisal is to develop the as-is Market Value, which is a Mortgagees tool for calculating the Commissioners Adjusted Fair Market Value, estimating the market value of the property described in this appraisal report, as improved, in unencumbered fee simple title of ownership".

 

[sputnam]

Usually the client is aware of the limitations of the form. Most likely this report is not for lending purpose.

I'm not sure I agree. Most of my work is doing reviews. As a part of that, I get the Letter of Engagement for the appraisal report being reviewed. It's very, very common for the Client to specify the use of inappropriate, or less appropriate, appraisal forms.