Closed Sale After My Inspection Date

[TRESinc]

ok, how about this. effective date is 6/19, sale closes 6/21, signature date of report is 6/22. since the report was not completed at the time the sale was pending can you still call it a closed sale?

 

[Peter LeQuire]

I haven't time to research the Selling Guide, but I'm not aware that I've ever encountered anything about "the spirit of the rules". The closest thing I could find that would communicate what the "spirit" of the rules might be is "accurate" or "honest" or "truthful" - all of which are antonyms for "misleading". One might argue that, since the current UAD format requires dates of contract and sale of the comparables is "MM/DD", as long as a comparable closes in the same month as the effective date of an appraisal is acceptable. Mebbe so, but that wouldn't conform to the requirement that there be at least 3 closed sales. (Or would we want to argue about the effective date? Not me.)

(From page 619 of the Sellers Guide: "Minimum Number of Comparable Sales
A minimum of three closed comparables must be reported in the sales comparison approach.")

Some might want to engage in an argument about whether an under contract house that closes between the effective date of an appraisal and the date of the report - I don't believe I would, and I think I'd rather make another trip to the property being appraised, or find some dog sale and report the pending sale as "pending" before I'd invite a challenge that the report I'd done was misleading.

But that's just me.

 

[David Thompson]

I have had this happen a few times. If it was the best comp. I went back and looked at the exterior of the subject again and changed the effective date, if not I sill showed it as a pending sale as of the effective date.

 

[Peter LeQuire]

I haven't time to research the Selling Guide, but I'm not aware that I've ever encountered anything about "the spirit of the rules". The closest thing I could find that would communicate what the "spirit" of the rules might be is "accurate" or "honest" or "truthful" - all of which are antonyms for "misleading". One might argue that, since the current UAD format requires dates of contract and sale of the comparables is "MM/DD", as long as a comparable closes in the same month as the effective date of an appraisal is acceptable. Mebbe so, but that wouldn't conform to the requirement that there be at least 3 closed sales. (Or would we want to argue about the effective date? Not me.)

(From page 619 of the Sellers Guide: "Minimum Number of Comparable Sales
A minimum of three closed comparables must be reported in the sales comparison approach.")

Some might want to engage in an argument about whether an under contract house that closes between the effective date of an appraisal and the date of the report - I don't believe I would, and I think I'd rather make another trip to the property being appraised, or find some dog sale and report the pending sale as "pending" before I'd invite a challenge that the report I'd done was misleading.

But that's just me.

ok, how about this. effective date is 6/19, sale closes 6/21, signature date of report is 6/22. since the report was not completed at the time the sale was pending can you still call it a closed sale?

You might - I'd rather not. If the pending sale closes after the effective date AND it is essential to the best analysis, I'd carve out the time to look at the victim property again.

 

[J Grant]

Go sleep fine till a reviewer finds out the date was fudged. Do what you personally want but it's terrible advice for other people. There is no such thing as "the spirit of the rules"...the rules are either followed, or they are not. I hate rules in my pseronal life, but this is not our personal life to do whatever we want, its a profession with a lot of rules (I sometimes think I am in the wrong profession but since I'm in it, if I sign a cert I did X or Y happeiIescrewfeweronweer

I have had this happen a few times. If it was the best comp. I went back and looked at the exterior of the subject again and changed the effective date, if not I sill showed it as a pending sale as of the effective date.

Why would you do that, if the effective date showed an INTERIOR inspection? Don't you think a borrower or RE agent would remember what day you went inside and can use a new made up date against you if for some reason a problem came up? The fact that you drove by it would be fine if it were an exterior only report...

If you need the sale that bad as a closed comp, explain to client and get paid for a new effective date new interior inspection, or use it as a pending sale and state it closed 2 days after eff date and before signature date.

 

[bnmappraisal]

I went back and looked at the exterior of the subject again and changed the effective date,

I think that's a good option, too!

 

[J Grant]

I have one lender client that if a sale closes in same month as the effective inspection date, requires the date it closed be described in narrative even though the UAD only has month and year. (for this very reason, they want to see that the sale closed on or before the effective date)

 

[J Grant]

I think that's a good option, too!

Really? That 's a good option, LYING and making a new effective date certifying you did an interior inspection on June 9 when you only drove by on June 9, you went really inside on June 7 for the interior effective date inspection.

Why expose yourself to risk and fraud charges for such a thing for no earthly reason or gain?

 

[hastalavista]

In almost any other type of real property appraisal work, a transaction that was pending prior to the effective date and closed 2-days after the effective date would be considered a very good comparable and a very timely indicator of the market.

I would and have used such a transaction for residential mortgage finance appraisasls. I simply explain what the circumstances were and what relevance (usually, a high relevance) I gave it in my analysis. Personally, I don't think it matters if it is identified as "pending" or "sold" in the grid. What matters (IMO) is how it is considered in the analysis. So I'd say either way is fine (pending or closed sale) as long as the timeline is disclosed.

 

[J Grant]

"Based on a complete visual inspection of the interior and exterior areas of the subject property, defined scope of work, statement of assumptions and limiting conditions, and appraiser’s certification, my (our) opinion of the market value, as defined, of the real property that is the subject of this report is $ , as of , which is the date of inspection and the effective date of this appraisal"

Above from the URAR we sign...if you state a new later effective date when you just drove by the exterior of the subject, then you DID NOT visually inspect the interior as of that effective date. (you inspected interior 2 days prior AND performed a prior appraisal service since now you have done two inspections, an interior prior to what you are saying the new later effective date is on the drive by.

Unless you disclose the interior inspection was 2 days prior to the exterior later effective date, sorry but it is appraisal fraud, why in the world would anyone risk their livelihood like this for nothing.