Curios How To Do This

[Xavier Hargrove]

I recently got an appraisal request to value a property as is then the value of the property minus a proposed land cut of one acre according to a survey to see if it would still support the mortgage amount. This cut of land would be going to the borrower's kin, and no purchase contract was observed. HBU is not affected. The original site is 33.06 acres with a livable manufactured home. The lender ordered the appraisal at address xxxx which was a property that was adjacent to this 33.06 acre. Both parcels are owned by the same borrower. One parcel is 33.06 acres and will be split for their kin to build a house, one parcel has a modular home on it and is 10 acres. There is no zoning observed for both parcels as they are in a rural part of NC.

I figured the lender got the address wrong as the 10-acre plot of land with the modular home doesn't support the 33.06-acre parcel. Nevertheless, I inspected both parcels when I went out, the borrower informed me that the original loan encumbered both parcels which he didn't understand or wanted. I completed the report per engagement "value of the property as is the value of the property minus a proposed land cut of one area. Since the land cut was not coming out of the 10-acre parcel (nor needed to support the mortgage) I did not value it. The lender came back and stated that the address for the application was xxxx and they wanted the value of the parcels together so a total 44.06 acres with two properties on it and a land split from there. Any thoughts?

 

[J Grant]

I recently got an appraisal request to value a property as is then the value of the property minus a proposed land cut of one acre according to a survey to see if it would still support the mortgage amount. This cut of land would be going to the borrower's kin, and no purchase contract was observed. HBU is not affected. The original site is 33.06 acres with a livable manufactured home. The lender ordered the appraisal at address xxxx which was a property that was adjacent to this 33.06 acre. Both parcels are owned by the same borrower. One parcel is 33.06 acres and will be split for their kin to build a house, one parcel has a modular home on it and is 10 acres. There is no zoning observed for both parcels as they are in a rural part of NC.

I figured the lender got the address wrong as the 10-acre plot of land with the modular home doesn't support the 33.06-acre parcel. Nevertheless, I inspected both parcels when I went out, the borrower informed me that the original loan encumbered both parcels which he didn't understand or wanted. I completed the report per engagement "value of the property as is the value of the property minus a proposed land cut of one area. Since the land cut was not coming out of the 10-acre parcel (nor needed to support the mortgage) I did not value it. The lender came back and stated that the address for the application was xxxx and they wanted the value of the parcels together so a total 44.06 acres with two properties on it and a land split from there. Any thoughts?

I frankly am lost and confused at this point ( I remember your original post, on it - )

It sounds like your client wants a completlehy different new appraisal now -which is a new assignment and a new fee. The amount of acreage sounds more like an agricultural use? or slit into smaller pacels HBU> issue. idk if a res license is adequate for it ?

Who cares what the owner and their kin want or if will support the mortgage amount - idk why that is a concern. .

 

[Tom D]

You have now entered the appraisal twilight zone. The appraisal outer limits, they control the vertical, they control the horizon, don't touch the knob on your tv.
Me and j grant are stainding in the same confused room.

 

[CGinMN]

It sounds like you didn’t properly understand the assignment from the beginning. The original mortgage likely encumbered both parcels, and it will still encumber both parcel, excluding the acre portion to be split off.

Typically in a partial release like this, the lender will want 3 values, but sometimes only 2:
-The value of the whole (44.06 acres)
-The value of the portion being released (1 acre vacant site)
-The value of the remainder, which is the whole excluding the portion being released (43.06 acres.)

 

[Tom D]

The borrower is being stupid, encumbering their home for a relative. See how that works, although i guess when built they can then re finance the new house only and payoff the mortgage on the other house. Creative way of doing a new construction.

 

[Zoe]

I don't know. Before you completed it, you should have ironed it out with the lender. If the borrower didn't want all the land on the same mortgage, then that would have been between the borrower and the lender. Is the owner splitting the 1 acre from the 10 acres or the 33 acres? These are separate parcels in public records? They gave you a survey of the 1 acre and the borrower don't want all of it on the same mortgage?

Your in a pickle.

 

[Zoe]

I guess the borrower could just quit claim that 1 acre to the kin and the borrower ask the lender to release that 1 acre. If I was the lender, I would consider that. I probably would release the 1 acre on the survey on the mortgage. I would have to record a new mortgage so current owner would have some closing costs involved.

Does that 1 acre impact the other 43 acres?

 

[Zephyr999]

@CGinMN...yup...larger parcel, remainder and the take.

Not sure why folks get hung up by the mortgage discussion...we value property rights.

 

[Terrel L. Shields]

I figured the lender got the address wrong

Mistake One. Always ask. It will save you time and again.
The report is complicated by involving more than one parcel. valuing the one acre less parcel is just that. Since land generally sells by the acre in large parcels, apply the unit value by the acres being involved. Ignore the one acre's value. Not relevant. So you have 43 acres more or less. Which is worth more the dwelling or the land? Then if land it is a land appraisal with improvements, if the dwelling it is a residential appraisal with excess land.

 

[Zoe]

I would talk with homeowner again and the lender and see if I could just do a new report for the lender. New appraisal. Don't charge for the first one. Just the second one.

I would not mortgage that much land on one loan. I might not even mortgage 10 acres much less the whole nine yards depending.

I feel sorry for you. This is salvageable. Work with the landowner and your client. And I assume maybe the kin that is getting the 1 acre. Get on same page with all three.