Desktop Appraisal Format

[Mike Boyd]

I think it is a really baaaaad idea to offer an opinion of value for a property you have not even seen. For one, how do you know it did not burn down the day before? How do you know there is not a gas station or some other environmental hazard next door? How do you know whether or not it has any siding, windows, doors or a roof?

Yes, as an appraiser we have the option of turning down an appraisal assignment or to charge whatever we wish. By the same token, if we ignore USPAP, we can do comp checks, predetermined value reports or reach for a value needed by the lender to make the deal if that value is reasonable. Some of you might recall that, before USPAP, we did those dastardly things and in doing so, created an expectation of similar activity AFTER USPAP. And, look what happened. Now, our biggest concern as appraisers is fighting those expectations. Is there anyone in here that truly believes thay can provide an accurate estimate of value with no caveats without a full inspection? I think not. Just because a lender asks us to do something, does not mean we should do it. Pam mentioned the proverbial march to the sea by lemmings. I think it's time we all made a right turn or about face to these requests. Otherwise, we become clerks and form fillers with incomes reduced to minimum wage without benefits.

 

[Terrel L. Shields]

"What is a desktop appraisal."

To me, it is the equivalent of the evaluation a bank officer will do, and they usually DO drive by and get a pix anyway.

think it is a really baaaaad idea to offer an opinion of value for a property you have not even seen. For one, how do you know it did not burn down the day before?

Disclaimers...always disclaimers. And like i reiterated before, I have no problem with the disclaimers except...A-are you good enough wordsmith to write the perfect disclaimer that covers every contingency? B- Because you are an appraiser, are you expected to do a better job than the evaluator/valuer for the bank? Is that realistic to assume? We are held to a higher standard. imho.

In other words. I can spend 8 hr. researching a property, inspecting, researching and inspecting sales, and 2 hr. writing a report and charge $350.
Or, I can spend 2 hr. researching the property and sales, and 1 hour writing the report analysis and 7 hours writing bullet proof text to CMA...(Cover my hienie) and charge $125.....The math doesn't work does it?

 

[Lee Lansford]

RE: Mike Boyd's immediate prior post...
Mike, "yes" a DeskTop Appraisal has to have the extraordinary assumption that the subject improvements do in fact exist as of the effective date.
Now, I imagine that some appraisers are gasping as they read the prior sentence.

Whether you or I conduct an appraisal:
1) Without viewing the subject propertyl;
OR
2) Viewing the subject from the front public street;
OR
3) Viewing the subject on site, interior and exterior,

we all have certain limiting conditions in our appraisals, yes?

Do we not have certain limiting conditions--we do not accept unlimited liability, do we?--even for those appraisals where we view (interior and exterior) the subject improvements?

The discussion on this topic is interesting. Keep in mind that what we are discussing goes to Scope of Work, Intended Use and Intended User.

Can any appraisal assignment--in the hands of an incompetent and/or unethical appraiser--end up with misleading results? Yes.

As to fees...we are all free to accept, or not, any fee which we may negotiate with a client.

Andrew, RE: your immediate prior post...
Yes, I understand your point regarding the uncertainty as to--when the "exterior-only" assignment was first introduced--how appraisers were to complete the assignment. I should have thought of that when I posted my earlier message.
Extending your good point, I believe that the same applies to appraisers who hesitate to ever even CONSIDER completing a DeskTop Appraisal. That said, I do understand that MANY appraisers work in areas where is is virtually impossible to complete such an assignment.
DeskTop Appraisals are being completed each and every day by competent and ethical appraisers. A bank client of mine does these internally with their staff appraisers.
When the "exterior-only" appraisal was introduced some time back, I would imagine that there were appraisers who said that they would never complete such an assignment (nad perhaps they not ever have done so).

Peace.


Lee Lansford, IFA
AQB Certified USPAP Instructor

 

[Jo Ann Meyer Stratton]

Decided to check out the old 704 form which went became available January 1986--so drive bys did not arrive with the 2055 form in 1996. The 704 had been around for ten years already--prior to the adoption of USPAP. At least the 2055 had some semblance to a USPAP compliant report, which the old 704 didn't have. So for years the only guide to follow was if the appraiser was a member of a professional organization and they had to be sure to be compliant with that organization of professional standards. Even before the 704, the office I worked in had a form they had developed for drive bys--so drive bys have been around for a very, very long time. Just thought I would throw in some historical tidbits of information.

 

[George Hatch]

This debate really comes down to an individual's answer to the question "what is an appraisal". There are lots of appraisers who take a fairly narrow view of what represents an appraisal, and to be sure, the more development that goes into an appraisal the less exposure there is for the appraiser.

We appraise properties without physical inspection of the improvements on a regular basis. Nobody gets wound up about working off of plans and specs for proposed construction or subject to a rehab that has not yet occured. We cover ourselves by noting that there are extra limitations involved and disavowing responsibility for conditions that arise that outside of the scope of work.

In my mind, doing a no-inspection appraisal is an extension of a sanctioned (and necessary) workproduct that we have offered since before I got into the business. We can reasonably cover our position by noting exactly what 'extra' limitations are involved and charge the reader with understanding the effects of these limitations.

There will be some assignments where the information available to the appraiser at their desktop will be sufficient to enable a reasonable workproduct as a response to a low-intensity intended use. There will be some assignments where sufficient information is not available or where there are other reasons to suspect their reliability. Just as with drive-bys. And the response for an assignment that requires additional inspection for the desktop product will be the same as for the 2055, the appraiser will either choose to bump the scope of work up to include personal inspection or else they will decline to finish the assignment at all.

 

[Doug in NC]

In the end we will be competing with AVMs.

Keith, we have already been competing with Avms for years, and their use has increased with time. Yes, in some ways they are eliminating the need for more extensive appraisals, but this is the way the industry is headed. Either we can work with them or we will be completely left behind. I intend to charge almost as much as a staff appraiser would get paid as a fee split, when doing a full appraisal for some AMC.

Lenders are going to order these products from someone. I would rather see an appraiser do them, than some lender or someone else with little to no appraisal training whatsoever.

 

[JSmith43]

Jo Ann said:

The fee they offered fro the drive by was a whole big $8--the interior one was $14. I started laughing so hard on the phone I couldn't even talk. The voice on the other line keep saying that was a standard fee that appraisers were accepting nationwide because the inspections could be done while on the way to or from an actual appraisal assignment. I just kept laughing harder and harder until I could finally gasp NO thank you and then they hung up.

I have a friend that owns such a business that covers a multi-state area. This is a pre-foreclosure status check. The rate quoted you is about market. Laughing at it is understandable since you are an accomplished expert and have higher uses for your time, which includes all that pro bono advice you dispense regarding MH.

My point is, there are plenty of takers. Typically, they do 20-40 a day. It is quite mechanized, no USPAP compliant files to store, etc. I didn't realize they were trying to incorporate appraisers into the foot soldiers that do this stuff. BTW, I know someone who did plat drawings for a large title company. You wouldn't believe how many he did per day and how little he got per assignment.

It can't be done economically where there are USPAP check lists, file retention requirements, etc. But in built up areas the model exists. I have trouble comprehending how McDonalds makes so much selling grease boiled potato slices and mad cow burgers, but I have to believe my lying eyes and the what?? 100 billion served signs :rofl:

 

[Anthem]

This is the form I use for the Bank on a daily basis.

 

[Anthem]

I prefer the banks version over this one

 

[Robert Anderson]

Doug and Preston,

I have never done one of these, but I don't have a problem with their use in the right circumstance. I was curious about one issue, which is the data source for the subject's property characteristics. Do you ever use just the public records? Does the lender supply property characteristics for the subect?

I don't have any ulterior motive here. I'm really just curious.

Thanks,

Bob Anderson