FHA 203K to 203b

[Sarge]

I did an appraisal a little over a month ago that was FHA 203k with improvements. I was just informed by the lender that it is now just a regular FHA and to remove the proposed updates and amend the appraisal accordingly. Would this not be a different assignment requiring a new inspection and a completely new appraisal report? I was told the case number is the same.

 

[andrew81]

USPAP does not specifically address this scenario. in my opinion the extend to which the scope of work has changed is significant therefore is a new assignment.

what does USPAP say about scope of work?

SCOPE OF WORK RULE
For each appraisal and appraisal review assignment, an appraiser must:

1. identify the problem to be solved;
2. determine and perform the scope of work necessary to develop credible assignment results; and
3. disclose the scope of work in the report.

Comment
Scope of work includes, but is not limited to:
• the extent to which the property is identified;
• the extent to which tangible property is inspected;
• the type and extent of data researched; and
• the type and extent of analyses applied to arrive at opinions or conclusions.

• the extent to which the property is identified has changed
• the extent to which tangible property is inspected has changed
• the type and extent of data researched has changed
• the type and extent of analyses applied to arrive at opinions or conclusions has changed

159. CHANGING THE SCOPE OF WORK AFTER THE REPORT HAS BEEN SUBMITTED
Question: Sometimes after submitting my appraisal report, my client will ask me to perform
additional work. This can mean looking at more or different comparables or
developing another approach. Do these requests for additional work create a new
assignment?

Response: No. Requests to perform additional research or analysis change the scope of work, but do not
create a new assignment. The additional work can be performed as part of the original assignment.
The appraiser may decide, as a business decision, to treat the request for additional research and
analysis as a new assignment, but it is not required.

edit//

also my notes from an FHA webinar include the following:
-What happens if the contract changes after the appraisal?
--the appraiser appraises the property based on the conditions at the time it was ordered
--base the scope of work at the time of appraisal
--anything which changes the conditions under which the appraisal was written needs an appraisal update and may constitute a fee increase. dont just change the report
--change in FHA case number? should be corrected
--amount of concessions change? requires an update
--tree falls on house after appraisal is completed? requires an update

 

[Amy Perkins]

I would probably say that it constitutes a new order, but you can give them a discount if you want since it probably won't take you as long.

 

[ValueArtist]

203k's are "Subject to" appraisal assignments.

 

[William K]

The client ordered a 203K appraisal for the subject property and you completed it, correct? This assignment on the same property is for a 203B appraisal which of course is not the same. Therefore what is the confusion?


Forget about the FHA factor for a second. If the client ordered an appraisal for a subject property in "As-Is" condition and you completed it, and then a month later they said OK you just did this now the owner is putting on an addition so make the changes and get me back the "corrected" appraisal right away, what would your response to the client be?

You completed one assignment and are now being asked for another assignment. If the property next door was identical to the subject and the client ordered a 203B on it a month later would you charge for it? Even if the measurements were the same and the Comparables were the same?


Appraisers keep performing work for free under the guise of "customer service". If you don't do it will your client still have to pay another appraiser to perform the assignment at hand? if so why would you not charge for it?

Go to your dentist and get a filling then next week go back and say you decided you want an implant instead. So make the change, after all, I paid you and you have already done work on that tooth.