Fair Condition vs Poor

[Alison Swain]

Okay --- concrete block house --- formerly tenant occupied. All kitchen appliances gone. Outside A/C compressor gone. No A/C-Heat system at all (we're in Central Florida). Carpet and cheap vinyl laid down but not fastened. 2 or 3 broken windows. Dried, black something covers the bottom of the tub. Roof appears to be near the end of its economic life but no signs of leaking. Ceiling over outside (attached) porch is falling. The house itself appears to be okay structurally but is crap cosmetically.

Is this home's condition "fair" or "poor?"

Photos available upon request via PM.

 

[xmagubty]

Poor. Fair is worn, in need of updating etc, but livable. To me, your description is of a house that is not habitable in its present condition, thus poor.

 

[Alison Swain]

Poor. Fair is worn, in need of updating etc, but livable. To me, your description is of a house that is not habitable in its present condition, thus poor.

Thanks, Frank. I'm writing up the Improvements section now and want to address my "subject to" contingencies. I'm kind of stuck here (I'm not used to having to make reports "subject to" except for new construction):


Subject's improvements appear to have been inadequately maintained with extensive deferred maintenance (see attached photos). Overall condition is considered to be poor. At time of inspection, there were no kitchen appliances present and no functioning air cooling/heating system (air handler unit was present but air compressor has been removed from exterior of structure). Subject's roof appears to be near the end of its economic life, although no evidence of leak damage was noted at time of inspection. Carpet and vinyl flooring is not permanently fastened in place. Some windows are cracked and/or broken. Security bars over windows do not allow escape from the inside and homeowner/borrower stated that the keys to the locks on the bars had not been returned by previous tenant.
Subject's detached garage does not appear to be stucturally sound as frame walls show significant wood deterioration and ceiling is falling in some spots (see attached photos)
Appraised value subject to inspection and recommended repair of roof, porch ceiling and detached garage by a state certified general contractor to determine structural integrity and safety of these features. Additionally, security bars must be removed or functional locks and keys installed to allow for escape from the interior of the structure.

 

[Terrel L. Shields]

sounds like a tear down to me...CC Block. No A/C. Needs roof, appliances, floor covering, etc.. You have nothing but a concrete block shell.

 

[Lobo Fan]

They are going to want an as-is value with a cost to cure. Don't forget incentive. I would describe it as poor as well.

 

[Marcia Langley]

Alison,

Don't forget that your condition rating, like your opinion of value, is subject to the HC repairs.

If your 'subject to repairs' bring the condition to a higher level, then that is the rating you report.

Your comments should stress that the reported condition depends on the HC.

 

[Alison Swain]

Alright, I'm going to need you veterans to be a little more elementary in your explanations --- remember, I'm not used to these kind of situations (believe it not, this is not a REO). What do I need to consider when estimating repair/cost-to-cure?

 

[xmagubty]

Thanks, Frank. I'm writing up the Improvements section now and want to address my "subject to" contingencies. I'm kind of stuck here (I'm not used to having to make reports "subject to" except for new construction):


Subject's improvements appear to have been inadequately maintained with extensive deferred maintenance (see attached photos). Overall condition is considered to be poor. At time of inspection, there were no kitchen appliances present and no functioning air cooling/heating system (air handler unit was present but air compressor has been removed from exterior of structure). Subject's roof appears to be near the end of its economic life, although no evidence of leak damage was noted at time of inspection. Carpet and vinyl flooring is not permanently fastened in place. Some windows are cracked and/or broken. Security bars over windows do not allow escape from the inside and homeowner/borrower stated that the keys to the locks on the bars had not been returned by previous tenant.
Subject's detached garage does not appear to be stucturally sound as frame walls show significant wood deterioration and ceiling is falling in some spots (see attached photos)
Appraised value subject to inspection and recommended repair of roof, porch ceiling and detached garage by a state certified general contractor to determine structural integrity and safety of these features. Additionally, security bars must be removed or functional locks and keys installed to allow for escape from the interior of the structure.

How about just appraising "as is" and leave it at that noting the hazards etc.

In any case, I don't think it is a good idea to get into the security bars thing as you are making a recommendation that you can be liable for; I think the best way to handle it is like you did the rest of the items, recommend that a competent tradesman, local code official etc inspect and determine what needs to be done; said person to be determined at the client’s sole discretion.

In the same line of thinking, it might be good to change - by a state certified general contractor - to "by a qualified professional of the clients sole determination" then the client is responsible for who does what etc........

I have quite a bit of experience at this type of thing, from the loan funding and portfolio review standpoint and I think the above would serve you best as it applies to limiting your liability.

Hope this helps.

 

[Wendy]

Looks pretty good to me - just two little changes I'd make.

1) Take out the no leaks line for the roof. Don't set yourself up for that liability.

2) Instead of "State Certified General Contractor" go with "appropriately qualified individual".


Edit to add: FrankA beat me to the second point (and had a better idea)!

 

[Joyce Potts]

Alright, I'm going to need you veterans to be a little more elementary in your explanations --- remember, I'm not used to these kind of situations (believe it not, this is not a REO). What do I need to consider when estimating repair/cost-to-cure?

Alison,

What difference does it make as to the intended use being a refi vs. an REO in this instance? OR like the Bella Collina lots, does the intended use make a difference, e.g., refi vs. foreclosure?