Comment Caucus

[ramrcdk]

Since mosts borrowers today get a copy of the report, a good reconciliation should be written to where the buyer borrower can understand why you came in blow the Purchase Price. It should also be written to where their loan officer can tell them why you came in under contract price. Its easy to do and it saves a lot of time and cuts out most requests for a ROV.

Agree ! The 1 Appraisal Dispute I ever received followed Fannie Mae Guidelines for the request. Since I had communicated with ________ during the inspection process, I was aware of Their Sales used in the Value Dispute Challenge. I requested a chat with the Head Appraiser SuperV'. She said there was NOTHING wrong with my report, explanations in the report were Spot On. And said the Reason for the request was: the Loan Officer was a personal friend of the borrower & where the LO was squeezing every dollar for the loan.
So, I had the bullets upfront. The LO was playing agent in finding not comparable higher sales which were Stupid to think they were in fact "comparable". My end of the challenge was completed w/n 30 minutes.

 

[J Grant]

Motivations are a condition of sale. They are intrinsic in the whole definition of market value.

Motivations can affect the conditions of sale. However.....

The motivations of a named, individual buyer/seller in a Sale contract belong to them personally, even if it affected the contract price.

Regardless of THEIR personal to them motivations for X $ CS price,, OUR opinion of subject market value is based on a presumed transaction of a (model) typically motivated presumed buyer and seller , at the terms and conditions of sale stated in the market value definition.

 

[residentialguy]

Motivations can affect the conditions of sale. However.....

The motivations of a named, individual buyer/seller in a Sale contract belong to them personally, even if it affected the contract price.

Regardless of THEIR personal to them motivations for X $ CS price,, OUR opinion of subject market value is based on a presumed transaction of a (model) typically motivated presumed buyer and seller , at the terms and conditions of sale stated in the market value definition.

Ok... But for their sale, it was a condition that affected the sale price. An appraiser must analyze the sale so they can find out the conditions that affected the sale price. One can't even determine if it was an arms length transaction without doing that.

 

[sputnam]

It's not our job to try to guess what the motivations of the Buyer and Seller are. A lot of the time, we never even meet either. Market value is predicated on a typical Buyer and a typical Seller. The Loan Officer, and the Agent, if there is one, have more contact with the Buyer than we do. They can simply ask.

 

[J Grant]

It's not our job to try to guess what the motivations of the Buyer and Seller are. A lot of the time, we never even meet either. Market value is predicated on a typical Buyer and a typical Seller. The Loan Officer, and the Agent, if there is one, have more contact with the Buyer than we do. They can simply ask.

Even if we know the particular motivation of an individual buyer or individual seller, it wont' change that our opinion of MV is based presumed actions of a typically motivated buyer and seller ( to refine the above)

Thus, even if the actions of an indivdual buyer are atypical, or affected by undue stimulus such as a bidding war, the actions of the typically motivated buyer/seller ( at the set of terms and conditions in the MV definition ) is used for appraisal purpose.

The sale contract price is 335k. Our opinion of market value is 300k. So whether the buyer paid a higher price because their sister lives next door, or due to an unknown individual reason, it did not affect our opinion of market value. Sure, it is nice, when we have the information, to explain a motivation for price was due to sister lives next door. But if we don't know that, it won't affect our appraisal

If I find out an individual motivation during normal course of business such as discussing the property with a RE agent, I use it. I personally am not comfortable with ( and doubt the lender or RE gaent wants me to ) call a buyer and grill them about their motivation. - it gets me too involved in their deal. Then if the appraisal is below value, the buyer or agent could be even more upset.