• 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.

Commercial Guy Without A Clue

Status
Not open for further replies.

Stephen J. Vertin MAI

Senior Member
Joined
Jan 17, 2002
Professional Status
Certified General Appraiser
State
Illinois
Ok, I admit it. I have not read the changes in USPAP concerning report updates, change of client and so on. I know, I know, so shoot me. The fact is, as a commercial appraiser I rarely have clients ask for updates, change of client, etc., on appraisal written within one year I know this is common practice in residential and most of you keep up with these changes so I seek advice.

I got a call from a bank. They want me to change the letter of transmittal so the appraisal is addressed to them instead of the bank the appraisal was originally prepared for. The appraisal is about 7 months old.

Under the old Standards I would get a release from the first bank, etc. But what do I do under the new? Help!, my eyes gloss over and I start to fall asleep when I get near this section of USPAP. I believe it is because I use it so infrequently. In fact it is so infrequent, I know USPAP will change again, by the time it comes to using this standard in my practice in the future.

Steve Vertin
 

Restrain

Elite Member
Joined
Jan 22, 2002
Professional Status
Certified General Appraiser
State
Florida
According to the current regs, a new order is a new appraisal and no release from the previous client is required. You can do several reports over a period of months on the same property, and each one stands alone. You don't need a release, etc. That's long since gone. So charge them with a smile on your face, content in the fact that it's easy money.

Roger
 

Will Trueheart

Sophomore Member
Joined
Feb 18, 2003
Mr. Vertin,

The change you stated wouldn't be an update it's more of a transfer. And, getting your client's premission (in writing if possible) to transfer the report is the critical step. I'm assuming the borrower is the same, otherwise it's a new appraisal.
 

Carnivore

Elite Member
Supporting Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
North Carolina
Stephen,

Make the new client get the letter, otherwise you will be running around like a chicken with your head cut off.

But, I admit to not knowing much about commercial, so is 7 months a long time? It is long enough for Residential.


"France has neither winter nor summer nor morals. Apart from these
drawbacks it is a fine country. France has usually been governed by
prostitutes."

---Mark Twain
 

Stephen J. Vertin MAI

Senior Member
Joined
Jan 17, 2002
Professional Status
Certified General Appraiser
State
Illinois
Ok, one saying I do not need a release two are saying I do. Is the new regulation that confusing? Seven months is not that long within the current market. There has been appreciation of residential in many areas of the country; however, industrial and office remain flat and have done so for at least a year in most of Chicagoland.

Steve Vertin
 

Mountain Man

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Georgia
Seven months is not that long within the current market.
....industrial and office remain flat and have done so for at least a year in most of Chicagoland.

If that is the case, I'd say re-print it with the prior client's written permission. But nothing changes, except the name..... EI: the effective date stays the same.

If they want an update (FKA "Recert") with a current effective date, that is a NEW appraisal request since you can not use option 3 under AO3. Option 3 (an update letter) is ONLY for the original client.

This new UslessPoop stuff is confusing, but that is how I see it. :? :scrambleup: Hope this helps. :wink:
 

Dan Leggett

Senior Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Mississippi
I know the USPAP guru's will have a heyday with my responce but here's the way I see it.

Date of report for Bank 1 is Jan 01.

Bank 2 comes along on Jul 01 and wants their name on the report.

Simply changing out the Letter of Transmittal, user, etc results is a misleading report. (ie: chronological order of relationship with Bank 2 is out of sync).

My solution is:
1) Let Bank 1 transfer/assign report to Bank 2, you don't have to do anything.
2) Acquire current engagement letter from Bank 2, revisit subject, research pertinant land/market/income/cost data, produce new report with all new dates, even if data and values are identical to Bank 1's report.

I'm sure there is an easier way but that's all I've got.
 
Joined
Jan 13, 2002
Professional Status
Retired Appraiser
State
Florida
Ok..... but.....

What if you get a new order from lender 2 stating that the effective date of 00/00/0000 (the original) is just fine for them.

Keep the effective date as it is, change what needs to be changed, sign it as of todays date, send it in to lender 2 with your invoice.

Now USPAP gurus, what is wrong with doing that? I see this as a perfectly legal scenario.
 

Mountain Man

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Georgia
Keep the effective date as it is, change what needs to be changed, sign it as of todays date, send it in to lender 2 with your invoice.
That's what I call a re-print; nothing changes but the lender's name. If the date or any info changes, other than the name, then you use option 1 or 2 of AO3...... which is considered to be a whole new appraisal report. :? :roll:

Fun. :lol:
 

Austin

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified General Appraiser
State
Virginia
Steven: If the first bank used the appraisal to support a loan and the second bank is refinancing the loan then you should get a release which they probably won't give under these conditions. If the 1st bank did not make the loan and the intended use has expired then they are out of the equation. Then there is the question of purpose, client, intended use = scope of the appraisal which was dictated by the appraiser and original client bank which might be entirely different and thus could be misleading. Kind of like taking some one else's medicine. Easy way out is one of the options in AO-3 but I still feel that if bank # 2 is refinancing that 7 month old loan you had better get their permission in writing again which they probably won't give and rightfully so.
 
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