FHA Compliance Statement

[ZZGAMAZZ]

Peers
please help me better understand the same condition client keep sending me:

My statement is:

Intended Use and Users:
The intended use of this appraisal is solely to assist FHA in assessing the risk of the Property securing the FHA-insured Mortgage.
FHA and the Mortgagee are the intended users of the appraisal report.
The FHA Appraiser does not guarantee that the Property is free from defects. The appraisal establishes the value of the Property for Mortgage insurance purposes only.

The conditon is:
(1) The appraisal is solely to assist FHA in assessing the risk of the Property securing the FHA-insured Mortgage

Is it asking me to remove he intened users?
Is my statement not the correct current version?
Thank you.

 

[TerryRohrer]

The Condition statement is likely how their checklist reads and they don't understand the "The intended use of" adds the context of USPAP to more clearly specify the statement. The current 4000.1, under a heading of "Intended Use and Intended Users of Appraisal", reads:

"The intended use of the appraisal is solely to assist FHA in assessing the risk of the Property securing the FHA-insured Mortgage (24 CFR § 200.145(b)). "

https://www.HUD.gov/sites/dfiles/OCHCO/documents/40001-hsgh-update16-5.pdf

 

[ZZGAMAZZ]

The Condition statement is likely how their checklist reads and they don't understand the "The intended use of" adds the context of USPAP to more clearly specify the statement. The current 4000.1, under a heading of "Intended Use and Intended Users of Appraisal", reads:

"The intended use of the appraisal is solely to assist FHA in assessing the risk of the Property securing the FHA-insured Mortgage (24 CFR § 200.145(b)). "

https://www.HUD.gov/sites/dfiles/OCHCO/documents/40001-hsgh-update16-5.pdf

Thanks very much. I waded through 4000.1 for hours looking for the statement and appreciate the reference. Now stealing my own thread, I often wondered why a second appraiser occasionally is odered after mine. The following page past the intended user statemen says:

(a) Second Appraisal by Original MortgageeA second appraisal may only be ordered if the Direct Endorsement (DE)underwriter (underwriter) determines the first appraisal is materially deficientand the Appraiser is unable or uncooperative in resolving the deficiency. TheMortgagee must fully document the deficiency and status of the appraisal inthe mortgage file. The Mortgagee must pay for the second appraisal.

Thing is, I have NEVER been contacted and asked by a lendeer to correct perceived deficienies when a 2nd appraisal is ordered, only when borrowers who seem to trust me reach out a week or two or three after my assignment is completed to ask why a 2nd appraisal is needed. I think if it happens again I will confidentially advise the borrower to ask the lender about material deficiencies--although it kinda reminds of the old adage that advises a guy "never ask a pretty girl any question unless you're prepared for any answer"!!!!!!!

 

[Tom D]

They used to do 2 appraisals when the current sale wasn't from a long time owner. I forget whether the last owner has to own it 6 or 12 months. So in a quick re sale they might do a 2nd appraisal. But the rule changed owner time wise recently. Fix and flip get them because of previous low price and short hold time.

That additional comment is say FHA isn't responsible if you buy a bad house, they told you to do a home inspection. You can't sue HUD because the appraisal purpose is for determining loan risk, period, not the quality of your home.

I also hope that you have FHA newer comment that we ain't home inspectors.

 

[ZZGAMAZZ]

They used to do 2 appraisals when the current sale wasn't from a long time owner. I forget whether the last owner has to own it 6 or 12 months. So in a quick re sale they might do a 2nd appraisal. But the rule changed owner time wise recently. Fix and flip get them because of previous low price and short hold time.

That additional comment is say FHA isn't responsible if you buy a bad house, they told you to do a home inspection. You can't sue HUD because the appraisal purpose is for determining loan risk, period, not the quality of your home.

I also hope that you have FHA newer comment that we ain't home inspectors.

I dont but I'll sure research it ASAP
Thank you.

 

[Tom D]

Here's my FHA comments, this was from doing them every day. for Refi or sale. I also use the observation comment for my conventionals. The roof comment is for my row homes, you have to say that for a flat roof.

The intended use of the appraisal is solely to assist FHA in assessing the risk of the Property securing the FHA-insured Mortgage (24 CFR § 200.145(b)). FHA and the Mortgagee are the intended users of the appraisal report. THE INTENDED USE IS TO EVALUATE THE PROPERTY, THAT IS THE SUBJECT OF THIS APPRAISAL, FOR FHA TO SUPPORT THE UNDERWRITING REQUIREMENTS FOR A FHA-INSURED MORTGAGE. NO ADDITIONAL INTENDED USERS ARE IDENTIFIED BY THE APPRAISER. ANY OTHER PARTY RECEIVING A COPY OF THIS REPORT FOR ANY REASON IS NOT AN INTENDED USER; NOR DOES RECEIVING A COPY OF THIS REPORT RESULT IN AN APPRAISER-CLIENT RELATIONSHIP. USE OF THIS REPORT BY ANY OTHER PARTY(IES) IS NOT INTENDED BY THE APPRAISER.

FHA Appraiser Roster Definition:
"Appraiser refers to an FHA Roster Appraiser who observes, analyzes, and reports the physical and economic characteristics of a Property and provides an opinion of value to FHA. An Appraiser’s observation is limited to readily observable conditions and is not as comprehensive an inspection as one performed by a licensed home inspector."

(A) - NO PERSONAL ITEMS ARE INCLUDED AS PART OF THIS APPRAISED VALUE. THE FOLLOWING PROPERTY, FIXTURES AND/OR INTANGIBLE ITEMS ARE NOT INCLUDED IN THE APPRAISED VALUE, BUT ARE A PART OF THE SUBJECT PROPERTY. THE ITEMS INCLUDED DO NOT HAVE AN AFFECT ON THE SUBJECT'S VALUE OR MARKETABILITY. Appliances left are older used, owner does not need them, or does not wish to take them. It is easier to just leave them with the house, included "as is".

ITEMS ESTIMATED VALUES
1. -0- $ -0-

(B) - THE SELLER IS PAYING 0% POINTS, $0 IN CONCESSIONS ON THE SUBJECT PROPERTY. THIS DOES NOT HAVE AN AFFECT ON THE SUBJECT'S VALUE OR MARKETABILITY.

UTILITIES WERE ON, FUNCTIONING. NO APPARENT STRUCTURAL DEFECTS. MECHANICAL SYSTEMS VISUALLY ARE IN WORKING ORDER, FUNCTIONING. APPLIANCES ON, BUILT-INS & KIT CABINETS FUNCTIONING. ADEQUATE ELECTRIC SERVICE. HEAT SOURCE IS PERMANENTLY ATTACHED, VENTED TO OUTSIDE, CAN HEAT ALL AREAS W/PLUMBING TO MINIMUM 50 DEGREES, MEETS LOCAL CODE & ALL FHA/HUD REQUIREMENTS FOR HEAT SOURCES. THE FLAT ROOF AREA COULD NOT ADEQUATELY BE OBSERVED VISUALLY. NO LEAKS WERE NOTED INSIDE THE DWELLING. Smoke detectors were present the time of inspection.

The subject property meets the requirements of Handbook 4000.1.

 

[sputnam]

Peers
please help me better understand the same condition client keep sending me:

My statement is:

Intended Use and Users:
The intended use of this appraisal is solely to assist FHA in assessing the risk of the Property securing the FHA-insured Mortgage.
FHA and the Mortgagee are the intended users of the appraisal report.
The FHA Appraiser does not guarantee that the Property is free from defects. The appraisal establishes the value of the Property for Mortgage insurance purposes only.

The conditon is:
(1) The appraisal is solely to assist FHA in assessing the risk of the Property securing the FHA-insured Mortgage

Is it asking me to remove he intened users?
Is my statement not the correct current version?
Thank you.

I would tell them to pound sand. Well, I'd probably ask them to escalate the issue to their supervisor first. IMO, your statement is acceptable. As far as I know, nothing in USPAP or FHA guidelines require the appraiser to word comments EXACTLY as USPAP or guidelines do.