Engagement Letter Suggestions

[jay trotta]

Elliott, you circled #4 ???? ROFL

In Residential, I would think you need an Engagement letter for a "complex assignment" in some instances. I believe when you sign an Engagement letter with a Lender, there are specific's in that letter that layout the Terms of Engagement - to which I always add; this does not mean that we will particiapte in warm showers; candelite dinners; obscene phone calls from U or to U; no co-mingling of "soup coolers" and you will hold harmless our company and it's appraisers from any and all claims whatsoever.

Private work, Divorce / Estates /Tax Appeals and any other work, out side of Lending, gets our super sonic engagement letter, prior to any work.

Cheers

 

[Elliott]

I have a great engagement letter...its on some old computer
3 or 4 back sitting in my attic and it had 14 paragraphs and fit
on a legal page.

Just to show I can write one....here is the last one I did for
a complex assignment...

Dear Mr. Attorney,
As requested, I’m preparing this general proposal for an appraisal on the distressed property owned by the HOs, located at 123 Elm Street. I would prepared three residential valuations on standard residential appraisals forms (approximately 20 pages) which would be USPAP compliant. The valuations would be based on a December 2005 valuation before the slide event, after the slide event, and a current valuation. The fee would be $XX,zzz, with a $XX,zzz retainer paid in advanced and the balance to be paid within 15 days of delivery of the reports. Consultation, trial preparation, court appearance and travel time would be billed at the rate of $XXXX per hour and would be itemized.

I’ve attached a current qualification sheet.

Sincerely,
ER

 

[Vegan702]

every assignment is required to have an engagement letter otherwise how do you identify use, user, scope, this is appraisal 101. the lack of understanding on this point makes me throw up. be a profesional.

Spell check is your friend. If you are going to attack someone at least spell correctly and be professional about it.

 

[Mike Kennedy]

vacant land........:Eyecrazy: my...."letter of Disengagement" is on the way. check with your E&O Insurer for guidance drafting yours.

 

[Couch Potato]

When I took my on-line 2006 USPAP update class, I
remember a multiple choice quiz question that went:

All of the following are requirements in developing an appraisal except:

1. Determine the Scope of Work
2. Identify the Client
3. Prepare an Engagement Letter
4. Identify any Extraordinary Assumptions

I'd hate to think I paid all that money and got
the question wrong.

Elliott

An engagement letter is a great way to do the other three.

 

[Rick Neighbors]

Letter of engagement

Preston,

Back to your original question. I use Alamode software, and they have a couple of great examples of engagement letters. I consider them my "contract" to do the work I was asked to do. I like something in writing, call it a CYA. I don't care if it is USPAP or not, it is just makes good business sense to have an agreement with your client as to what they are expecting you to provide them, and what you have agreed to provide, and what you will be paid for that service.

If you would like to see a copy of the letters that I use, just drop me a PM at rick@rickn.com and I will be glad to forward you copies.

Later,
Rick

 

[Anthem]

Thanks for all the help I am almost done with my letter and have really enjoyed preparing it.

 

[CANative]

I am almost done with my letter

Thank goodness! Michael can stop throwing up now.

 

[Mike Boyd]

All appraisal orders should be in writing so that there is a mutual understanding of what will be done and what the fee will be and how it will be paid. An ENGAGEMENT LETTER is a more formal document and maybe even a contract. The more complex the assignment, the more complex the engagement letter. I remember reading a few years ago that you can have a single engagement letter with a specific client that covers all appraisal orders that company might send you ad infinitum. Keep in mind that most lenders will not allow you to prepare a unilateral contract for your benefit only. They will want a multi-page document prepared by their legal department that is primarily for THEIR protection. By the time your attorney and their attorney finally agree on how it is to be worded, the original mortgage will be paid off, the kids out of college and the motorhome purchased with a new reverse mortgage. Keep it simple. Put all that stuff in your SOW.

 

[Pat Butler]

One major point I have in all of mine is that, unless otherwise agreed upon, the appraisal is not to be used in a litigation environment. I actually do a lot of ligitation work so many of my engagement letters do show that as an intended use. But I can't tell you how many appraisers I see in court who show up with a flimsy appraisal that they never thought would have to be scrutinized in court. Their SOW just wasn't rigorous enough for that use.

Also, I get really detailed with my SOW statement in the engagement agreement for ligitaiton work. That way, I can't be held accountable for any data that I did not consider if that data was not discoverable via the agreed upon SOW. You have to limit your research somehow, and it's best to have an agreement as to where that limit is.