Extra line on grid for bedroom adjustment?

[VolcanoLvr]

On the wonderful 1004, 2055, 1004C forms, etc., there is an extra blank 'input box' field just to the right on the line pre-printed with Total Bdrms. Baths.

Do any of you use that 'empty' field to show the bedroom adjustment for total bedrooms in the dwelling? (Don't go ballistic just yet, OK)

Many appraisers were trained to 'lump' the bedroom and bath adjustments together in the field box next to where the room count is entered. That can get very confusing. I use that line for bath adjustment only.

Now let's cycle forward to the wonderful UAD process. I typically do not make a room count adjustment for rooms below grade, 'counted' by the UAD reporting convention. I just make an overall adjustment for the below grade space on the first line in that section.

I make a total bedroom adjustment because that's a livability factor most buyers key on. (I'm not alone doing this.) If two homes of similar GLA have a different # of bedrooms, typically the home with more BR's will sell for more $. Thus the separate BR adjustment is justified, even though the GLA has already been adjusted. This is easily explained.

I used the word total bedrooms above. I've been totalling the above grade/below grade bedrooms and adjusting the difference on the line noted above. But one client U/W department cannot understand the process, and of course they do not read the comments in the report to get the explanation. They use 'underwriters' who only know how to review reports using a pre-set check box system that may not correspond with actual appraiser practice in different parts of the country. They of course demand conformance to 'their' system, even though other lenders don't.

I'm not aware of any specific Fannie/Freddie requirments for reporting/adjusting room counts in any particular way. They do expect an explanation for what was done.

What say you to this issue??

OK ... now I'll go put on the chain mail and suit of armor ... and wait for the avalanche of negative comments.

 

[Michigan CG]

... and wait for the avalanche of negative comments.

I have done studies of bedroom counts in three midwestern states and there is no justification for a bedroom count adjustment in those areas.

 

[residentialguy]

I typically don't adjust for bedrooms except for 1 vs 2 or condos. My software automatically puts the bedroom count on the top level and bath on the 2nd. I believe FHA says they want the bath on the top and bed on the 2nd space. Never done it that way and never been called on it. It's not a Fannie or UAD issue. I don't think anyone cares.

 

[Jo Ann Meyer Stratton]

I use Clickforms and the UAD reviewer stops the conversion to a UAD report if the bathroom count is different than the subject and there isn't an adjusment or a 0 on the top line. If there is a difference in either total room or bedroom count, the UAD reviewer stops the conversion again if there isn't an adjustment on the middle line.

I have several lenders and AMC's also require the bathroom adjustment on the top line and total room or bedroom adjustment on the middle line. For over thirty years I did the opposite, bedroom count on the top line (very, very seldom happened) and bath count on the middle line.

So it appears that bath adjustment on the top line and bedroom or total room count adjustment on the middle line will be the wave in the future. In October we will find out which way Fannie and Freddie really want it.

 

[Mr Rex]

FHA says top line is for baths, next line for BR count, the next for GLA:


Above Grade Room Count
• Enter room count, consistent with the description of improvements on the
front of the appraisal form. Up to three adjustments may be entered:
The first line is for bathroom count differences. A deficiency or surplus
in the number of baths should be adjusted first.
The second line adjustment is for room count.
The third is for a difference in square footage.
• Explain any comparable property that has an adjustment in both square feet
and room count.

In my market there is no market preference for 3 or 4 BRs, but there is a definite and substantial difference for 2 vs 3. Most folks want at least 2 BRs and another room for an office, exercise room or whatever.

 

[Terrel L. Shields]

I am curious if a buyer of a house of 4,000 SF and 4 bathooms would not pay exactly the same if the house had 5 bathrooms or 3?

 

[sandpiperapp]

For single family homes, in my market area, a bedroom adjustment is not usually justified.

If there is a functional issue, such as a two bedroom home in an area of generally three and four bedroom homes and I need to adjust for bedrooms, I adjust for it in the Functional Utility grid.

If I am forced to use condo's or co-op's with different bedroom counts, where a market adjustment is usually justified, I also make that adjustment on the Functional Utiity grid.

 

[Beurre Noir]

I have done studies of bedroom counts in three midwestern states and there is no justification for a bedroom count adjustment in those areas.

Oh yeah? Well, in California most appraisers just adjust $10,000 for bedrooms regardless. Even in those little 1100 sqft ranches that are 80% land value. Midwesterners just don't use the same list, you see.

 

[hglenbetts]

I am curious if a buyer of a house of 4,000 SF and 4 bathooms would not pay exactly the same if the house had 5 bathrooms or 3?

Not intending to school the master, this is for the sake of the "others".

You'd need to do a paired sales analysis to be sure, or look it up in the newest addition of "Grid Adjustments for Dummies"

 

[unloadit]

I use that spot for bedroom adjustments if they need to be made.