• Welcome to AppraisersForum.com, the premier online  community for the discussion of real estate appraisal. Register a free account to be able to post and unlock additional forums and features.

Closed Sale After My Inspection Date

Status
Not open for further replies.

wrhsehajh

Freshman Member
Joined
Oct 16, 2007
Professional Status
Certified Residential Appraiser
State
Illinois
Inspected a property 06/19 used a closed sale of 06/21. I stated the sale as closed and not pending as it was on inspection date...how would you report the comparable and why?

Thank you for the feedback!
 

bnmappraisal

Elite Member
Gold Supporting Member
Joined
Nov 9, 2011
Professional Status
Certified Residential Appraiser
State
Florida
TECHNICALLY it was a pending as of your inspection/effective date. But it sounds like it closed/sold between your eff date and signature date ...

I used to be of the school of thought that TECHNICALLY it should be reported as a pending, but have since revised my thinking some.

Generally I try to find closed sales as of the eff date of my report and stick to that. However, on rare occasions, if a pending has closed in between eff date and sig date, I have used it as a closed IF it is truly one of the "best comps available." If and when I use such a comp, i usually have 3 other closed sales and this is a 4th. I feel it adds additional support of the current market as it literally closed as I was appraising the subject.
 

wrhsehajh

Freshman Member
Joined
Oct 16, 2007
Professional Status
Certified Residential Appraiser
State
Illinois
TECHNICALLY it was a pending as of your inspection/effective date. But it sounds like it closed/sold between your eff date and signature date ...

I used to be of the school of thought that TECHNICALLY it should be reported as a pending, but have since revised my thinking some.

Generally I try to find closed sales as of the eff date of my report and stick to that. However, on rare occasions, if a pending has closed in between eff date and sig date, I have used it as a closed IF it is truly one of the "best comps available." If and when I use such a comp, i usually have 3 other closed sales and this is a 4th. I feel it adds additional support of the current market as it literally closed as I was appraising the subject.

sums up my thought process as well, thank you for the reply
 
D

Deleted member 134708

Guest
I just had same thing. Sale closed 1 day after inspection. I showed as closed and fully weighted it.

I wrote, something along the lines of "comp x closed escrow/sold 1 day after the effective date. The appraiser included this as a closed sale even though it was after the effective date. The time frame is within reason to use as a closed sale. The appraiser used peer practice standards of including it as a closed sale...blah blah.

I used a lot of "peer this and peer that talk to try and cover me. I also gave my thought processes for why I used it and why it was a very good indicator of the subject's value.


Caveat: Get other appraisers answers before take mine. I'm not all that experienced and used civilian logic.
 

Mr Rex

Elite Member
Joined
Jan 12, 2004
Professional Status
Certified Residential Appraiser
State
North Carolina
Closed after effective date so it should be reported as a Listing under contract.The neat thing is that you now have the proper list to sales price info to report rather than using a % based on historical data. Since you have this info feel free to weight it as you please, but most lenders will still want 3 closed sales as of the effective date.
 

J Grant

Elite Member
Joined
Dec 9, 2003
Professional Status
Certified Residential Appraiser
State
Florida
If it closes the same day as the subject inspection date I would use it as a closed sale.
If it closes the next day, or any day after inspection up to the signature date, I write narrative comments on it's closed price and date but it stays a pending sale (listing under contract ) on the grid.

Even if it's a day or two after, the fact is it closed after the effective date of subject inspection, no way around it .
 
Last edited:

Peter LeQuire

Elite Member
Joined
Jan 3, 2005
Professional Status
Retired Appraiser
State
Tennessee
I would report such a transaction in its status at the close of business on the effective date of the appraisal. I would have no difficulty giving such a sale whatever weight its characteristics and terms of sale warrant after it closes. Such a transaction is clearly not a closed sale as most users of secondary market appraisals intend.
 
D

Deleted member 134708

Guest
I'm a big fan of using logic and the spirit of the rules.

No parking from 8am-10am for street sweeper.

Street sweeper goes thru at 8:15am. By all means, park there at 8:16am without a care in the world.

Market didn't change 2 days after the effective date. If it did, it proves peers also think appraisals are useless as funding occurs after the effective date.

If it was my money and I cared about risk, I'd want all the sales to be as late as possible. But, ain't my money or illogical rules so...
 

J Grant

Elite Member
Joined
Dec 9, 2003
Professional Status
Certified Residential Appraiser
State
Florida
I'm a big fan of using logic and the spirit of the rules.

No parking from 8am-10am for street sweeper.

Street sweeper goes thru at 8:15am. By all means, park there at 8:16am without a care in the world.

Market didn't change 2 days after the effective date. If it did, it proves peers also think appraisals are useless as funding occurs after the effective date.

That's not the point. Appraisers would be needlessly risking license or complaint of fraud over such a thing when they don't have to. A woman is pregnant up to and until the day she delivers the baby and that delivery date and time is when baby is born. Just like a closing . It happened or it didn't' on a certain date . We cant's fudge around it as if it closed before it actually did. Appraisers have nothing to gain and everything to lose by doing this, it has nothing to do with if the market did not o change in two days or it's the best comp.

Say it was strongly considered in the value as a pending sale with further support that it closed two days later on X date for Y price. End of story. If it is so desperately needed as a closed sale comp, tell lender the situation and go back out and do a second, new eff date subject inspection (( and disclose prior service). I get the point but you and I don't make the rules, even if the rules make little sense, we will suffer the consequence if we are seen to evade the rules if only by a day.
 
D

Deleted member 134708

Guest
I couldn't care less which way someone does it.

An appraisal is a report. Not a 1 page grid. Within this report is the details of why, how, what. Everything is fully explained. An appraisal is 1 data point in the lending decision.

Do anyway you want. I'd sleep fine doing both ways. I prefer to use the spirit of the rules.
 
Status
Not open for further replies.
Find a Real Estate Appraiser - Enter Zip Code

Copyright © 2000-, AppraisersForum.com, All Rights Reserved
AppraisersForum.com is proudly hosted by the folks at
AppraiserSites.com
Top

AdBlock Detected

We get it, advertisements are annoying!

Sure, ad-blocking software does a great job at blocking ads, but it also blocks useful features of our website. For the best site experience please disable your AdBlocker.

I've Disabled AdBlock
No Thanks