Encroachment question?

[Craig Roberts]

Is it still okay to make an extraordinary assumption or perhaps just an ordinary assumption that the improvements are located within the confines of the subject site? I didn’t see that covered in the limiting conditions of the new 1004 residential form.

What are you folks saying when you see what appears to be an encroachment on the subject parcel?

 

[Richard Carlsen]

If it looks like a real potential problem with no recorded legal access provided etc. CB4 would seem to be the way to go.

You could, if the encroachment is not causing any apparent problems as of the effective date, just say that there may be an encroachment and if the client is concerned about encroachments, they should check it out with a qualified land surveyor. As of the date of the inspection, it did not appear to be causing any problems that would effect value.

And no you cannot make that EA on the new forms. Only EA's and HC's that are provided for in the report are permitted.

 

[Mike Kennedy]

Is it still okay to make an extraordinary assumption or perhaps just an ordinary assumption that the improvements are located within the confines of the subject site? I didn’t see that covered in the limiting conditions of the new 1004 residential form.

What are you folks saying when you see what appears to be an encroachment on the subject parcel?

specifics?????????

 

[Craig Roberts]

What about an ordinary assumption? Are those also forbidden?

 

[Deleted member 80407]

Encroachments

I once completed an appraisal where there was a concrete drive, a garage and part of the side entry which encroached on the site to the north. When calling the city for zoning, the building commissioner remembered the address due to the city trying to sell off the property to the north to a developer. The building commissioner commented that the city would not allow for the sale to occur until the encroachments were removed. He also supplied me with a survey the city had performed. I disclosed them in the report. Boy, the seller got MAD!!! According to the owner (BS), the drive and garage were not his. HOWEVER, he had the keys to access the garage. The things people will do to get things done. DISCLOSE !!!!!!! If you are not sure, condition the report for a survey.

 

[xm39hnu]

What about an ordinary assumption? Are those also forbidden?

The only ones you can use are the ones already on the preprinted form.

 

[Marcia Langley]

Craig,

As the others have said, if you need an EA you must check the 4th box in the reconcilliation section. That is the only method for adding an EA to the new forms.

 

[Don Clark]

It can come back to bite you

If you suspect that there is an encroachment then say so. I did an appraisal where there were no obvious encroachments. Then the borrower complained to VA that I should have noted that the rear deck encroached across a utility easement to the rear. I went to the planning department, got a copy of the city survey which showed the house and all the improvemnts, and all easements on the property. The deck was over 50 feet from the utility easement. If I had suspected an encroachment to start with I would have called for s survey at the time. It would have saved me several days of worry and trips to the planning department. You are in the cat birds seat. call for a survey.

BTW, I once did an appraisal where the roof line encroached over the property line next door. The Chief Assessor showed me a copy of an arial photo to confirm the encroachment. It was simople to work out as the guy next door had built the house with the encroaching roof line next door and signed a waiver. But, could have been headaches if not noted.

Err on the side of caution.

 

[Brad Ellis]

Craig,

If you are using the Fannie 1004 you are not permitted to add any extraordinary assumptions but your thoughts are on the right track.

One solution would be to do the assighment "subject to" a survey or title reprot confirming no encroachments.

The difference between an ordinary assumption and an extraordinary one is that the extraordinary one, if found to be not the case, would materially impact your analysis and value opinion. Good chance that is the case with your possible encroachment.

Brad

 

[Craig Roberts]

Craig,

If you are using the Fannie 1004 you are not permitted to add any extraordinary assumptions but your thoughts are on the right track.



Brad

unless of course I mark CB4, then the EA is acceptable? Is this correct?