Definition of client

[Anonymous]

Tom:

You said what I attempted to say, though more eloquently. The appraiser must find out the intended use of the appraisal. If that use is for lending, the lender must be the client.

 

[slacker]

Tom:

You said what I attempted to say, though more eloquently. The appraiser must find out the intended use of the appraisal. If that use is for lending, the lender must be the client.

If the intended use is for a loan, the home owner must have started the process that requires the appraisal. Can both the home owner and the lender be considered the client? 8O

 

[bradellis]

Tom and Bill,

I must disagree. The intended user is not necessarily the client. For example, if ABC mortgage orders an appraisal from me for FHA lending purposes, HUD becomes an intended user but is NOT the client.

Fannie and Freddie, while GSEs, do NOT fall under the federally related umbrella. Seems silly, but that is the case.

Furthermore, intended users may be named by type and do not have to be individually identified.

What is clear is that, IF you know that the lender is a federally regulated bank, AND that the transaction is a federally related transaction, you should advise the borrower that his lender must order the appraisal.

This does not appear to be the case in this instance.

Brad Ellis, IFA, RAA

 

[bradellis]

Tom and Bill,

Forgot to mention another thing. The GSEs (Fannie/Freddie) COMBINED buy no more than about 25% of mortgages. FHA insures another 33% +/-. That means that nearly half of all transactions sold are sold to private investors. Typically, this happens via mortgage backed securities sold on Wall Street.

So, unless you KNOW that the loan would be sold to Fannie/Freddie, making such an assumption would be unsupportable. Chances are nearly 2 to 1 that it will be sold elswhere.

Brad Ellis, IFA, RAA

 

[Ben Vukicevich SRA]

I only posted my scenario to show how wacky it gets with the client stuff and USPAP, and USPAP with federally-related transactions, and USPAP with non-federally related transactions until no one knows what the hell to do to make anyone happy.

So as you've seen in my previous post, I solved the problem by telling the borrower to get a copy of the report from the lender. Hey, as long as they go away.....

And now for the final say on what to put in that Lender/Client box on the appraisal forms, we go to the "source" 4150.2 on Page D2, it is written

Lender/ o Enter the name and address of the
individual and firm who engaged

Client the appraisal. Generally, it is assumed
that the lender is also the client. If
the client is not the same person as the
lender, include the client's name. If the
client is the owner, enter "Client is
Owner".


Oh boy, now I have to put the loan opener's name along with the mortgage company's name in that little box???? Ah, maybe her home address along with the mortgage company's business address??? Multiple clients?? My brain hurts.

Oh well, I think I'll take my kids advice when they screw-up and get caught..."Dad, get over it."

Of course, thanks for all of the opinions of the posters. I hope we've learned something.

Ben