Considering filing complaint for lack of market conditions adjustment on stale comps

[glenn walker]

bottom line is if you give me $10,000, its $10,000 to me.

Deleted

 

[NC Appraising]

Thanks for the compliment, It seems that the OP indicates that the appraisal report didn't include any significant market analysis or support for the opinion: quoting op:

“while prices for similar dwellings have increased in the neighborhood, the small data sample and variety of product sold in any one period has lead the appraiser to conclude that the market is stable and an adjustment for time is not necessary”.

As far as the reliability of the 1004mc; utilize the FNMA instructions: it is not going to be statically correct, because the removed video instructions for the 1004mc included a search utilizing price range. Which, has been established that results in generally stable statistical dataset output. You can experiment by placing a group of random variables of price points in a range in excel, placing a second group of random variables, and then gauging the median or mode of the variables. Output will be generally of little difference (stable). Like much FNMA says to do, it is not reliable, I concur with other thought leaders who have long advocated that GSE work should include a jurisdictional exception. I will leave that for another argument though.

Your graphs are great, it is highly unlikely that the OP's appraisal included that. I utilize graphical analysis in my work, and have paid $1000+ for my own home appraisals and seen that level of analysis and images, however, very seldom have seen it in a typical lending appraisal. According to the OP, a large group of data was not included and the appraiser(s) ignored the increase in neighborhood sales prices.

I would refer your graphing to enhanced market analysis, and a minimum required for a highly changing market. Good job!

“while prices for similar dwellings have increased in the neighborhood, the small data sample and variety of product sold in any one period has lead the appraiser to conclude that the market is stable and an adjustment for time is not necessary”.

Did the appraiser not read the instructions on the 1004MC form LOL. You do not stop....your job is not done.

It tells you what to do on the form? That was kinda my original point on the form. I am tired of seeing statements like that from appraisers and then just checking stable. The form requires you to include additional data and analysis. If it is from Zillow, the feds, case/shiller, corelogic, fannie, I am good with it, include something, because more than likely they are showing a increasing market and you have the data to back it up. In other words, appraisers stop being lazy and relying on the 1004MC form to give you a "easy out". That is all the 1004MC is, a easy way out. I live in realville, I understand that a typical appraiser is not going to spend 1 hour on market condition adjustments, but my gosh there are so many data sources to use that takes 1-5 minutes to produce.

The 1004MC report (lender requires it) is wrong about 85% of the time when I use it. It even shows a declining market sometimes.....

 

[TMG]

Well said, Post 114

Post 114....is the name of my new Band!!

 

[Zoe]

Your seller paid concession analysis can be done numerous ways but one equation never changes and that is we adjust only the comparable sales that had concessions not the Subject Property. And that is based on protocol, proper methodology and Fannie-Freddie-FHA-VA Guidelines.

Yes, but most of time the concessions apply almost dollar for dollar. Rural can vary. And OP is talking $700K property and I doubt it's rural. I bet he or she is urban. I don't know Hawaii from garden of eden.

 

[Zoe]

I do want to visit.

 

[RCA]

KISS principle. Keep it simple stupid. If you have data that supports a higher market value opinion, send it to your lender and ask them to request a reconsideration of value. Read the definition of market value first. Have you ever read the definition of market value in the appraisal?

Can you possibly think in an orderly manner?

1. KISS can mean two things: (1) Keep it simple and stupid or (2) You are stupid and therefore you should keep it simple. So, it doesn't apply if you are smart. You should be smart, not stupid.
2. KASAP Keep As Simple As Possible is valid.
3. A market value opinion higher than what? You must be referring to some post I haven't read. Please state what you are referring to.
4. There are multiple definitions of market value. You seem to think there is only one.

I'm afraid you are down at a lower level, but just don't know it.

 

[DWiley]

“while prices for similar dwellings have increased in the neighborhood, the small data sample and variety of product sold in any one period has lead the appraiser to conclude that the market is stable and an adjustment for time is not necessary”.

Did the appraiser not read the instructions on the 1004MC form LOL. You do not stop....your job is not done.

It tells you what to do on the form? That was kinda my original point on the form. I am tired of seeing statements like that from appraisers and then just checking stable. The form requires you to include additional data and analysis. If it is from Zillow, the feds, case/shiller, corelogic, fannie, I am good with it, include something, because more than likely they are showing a increasing market and you have the data to back it up. In other words, appraisers stop being lazy and relying on the 1004MC form to give you a "easy out". That is all the 1004MC is, a easy way out. I live in realville, I understand that a typical appraiser is not going to spend 1 hour on market condition adjustments, but my gosh there are so many data sources to use that takes 1-5 minutes to produce.

The 1004MC report (lender requires it) is wrong about 85% of the time when I use it. It even shows a declining market sometimes.....

I was with you until that last sentence . Too many just want to fill in the 1004Mc grid and stop. As you point out, if the grid has insufficient data for trend analysis, the job (and the form) is not yet complete. The grid should be supplemented with additional data, as you point out. So, if done correctly, the 1004MC is neither wrong nor useless. It is only wrong and/ or useless when not fully completed.

A conclusion of STABLE should be no less supported than a conclusion of increasing or decreasing. Stable is not an “acceptable default”. It requires support. If there is not enough data to mark increasing, then how is there enough data to mark stable?

 

[Zoe]

I am thinking for about $2,000 and expenses paid, I could visit and we could work it out. I need paid up front on $2k and signed engagement. I could do damage in that market in a week.

 

[glenn walker]

Your thread - like chum in the water - has now attracted all of the "characters" on this Forum. May God help you.

“while prices for similar dwellings have increased in the neighborhood, the small data sample and variety of product sold in any one period has lead the appraiser to conclude that the market is stable and an adjustment for time is not necessary”.

Did the appraiser not read the instructions on the 1004MC form LOL. You do not stop....your job is not done.

It tells you what to do on the form? That was kinda my original point on the form. I am tired of seeing statements like that from appraisers and then just checking stable. The form requires you to include additional data and analysis. If it is from Zillow, the feds, case/shiller, corelogic, fannie, I am good with it, include something, because more than likely they are showing a increasing market and you have the data to back it up. In other words, appraisers stop being lazy and relying on the 1004MC form to give you a "easy out". That is all the 1004MC is, a easy way out.

The 1004MC report (lender requires it) is wrong about 85% of the time when I use it. It even shows a declining market sometimes.....

Agree my experience is as many as 70% of all 1004-Mc are not supported by the data or misapplied. In reviews we gave up trying to even deal with it because it's like trying to get someone to quit pounding square pegs into round holes. If the appraiser is new or one who wants to learn how to do it properly then you have a chance but often the worst offenders are the appraisers who claim to have 20 to 40 years of experience and then, deliver you a report in which there own form contradicts what market trend or adjustments they have made. Hey "dunderhead" you marked Stable but are using 2% a month positive time adjustments.

Maybe this is why back in the day the Chief appraisers at the Banks and Savings & Loans told us that we were only allowed to check the stable box because we had no idea what we were doing. Also Fannie & Freddie did not purchase loans in declining markets back then. Hey-Walker you could cause a major pile up and crash leading a small three car funeral procession- So un-check that increasing box right now before you bring down this entire bank-- OK Boss Man- You have the MAI and I have nothing but a hope and a prayer

 

[Zoe]

Is the report credible? Understand the value definition and intended use and user?