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FHA - REO to purchase appraisal changes

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Ted Martin

Thread Starter
Senior Member
Joined
Jan 17, 2002
Professional Status
Certified General Appraiser
State
Kansas
I did an FHA REO a couple of months ago with less than $5000 in repairs, the report was based on "AS IS" condition.

The property is now under contract, with a new FHA loan, and escrow for the repairs. Do I add an amendment to the original report or just do a new report since it will now be done "SUBJECT TO" condition. Most of the comparable sales will change. I called the HUD tech line and they didn't seem to know which way I should do the report. Because of the change from AS IS to SUBJECT TO change there will be a change in value.
 

Ted Martin

Thread Starter
Senior Member
Joined
Jan 17, 2002
Professional Status
Certified General Appraiser
State
Kansas
Finally got a call back from HUD.

These are treated as a reconsideration.

The format of the reconsideration is up to the appraiser. Since all the comps change I think I'll do a new form (1004) report which will be identified as a reconsideration of the original report with reference to the original report.
 

Ted Martin

Thread Starter
Senior Member
Joined
Jan 17, 2002
Professional Status
Certified General Appraiser
State
Kansas
Just spoke to a HUD tech support person and the correct answer is I'm NOT to do a reconsideration. There are very specific instructions in HUD mortgage letter 00-27 that say the lender is to use the original REO AS-IS appraisal and can't order another appraisal for six months.
 
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