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FHA Verbiage

BreJune

Thread Starter
Freshman Member
Joined
Jan 28, 2014
Professional Status
Certified Residential Appraiser
State
Colorado
I have not done an FHA appraisal in years. I have a conventional assignment that has been converted to FHA before the report was done. What is the current verbiage that is required in our reports?
 

CANative

Elite Member
Joined
Jun 18, 2003
Professional Status
Certified Residential Appraiser
State
California
You have to take this as a new assignment. You will have to return to the site and comply with all of the inspection requirements (crawl space, attic, test appliances, test water pressure, etc, etc. The list is long.) This will trigger a new effective date and that will capture the requirement for order/ED being right.) You will have to do the 3 year dislosure thing.

If you need some sort of narrative template, here is a start. You can punch it up if you like.


Scope of work clarifications, intended use and user(s), additional client requirements:
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 identified as the intended users of this 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. A Home Inspection by a licensed Home Inspector is recommended. Refer to the HUD document "For Your Protection Get A Home Inspection." The client requested the FHA Case Number be positioned in the upper right corner under iinternal file number.

The subject property meets HUD Minimum Property Requirements as described in HUD Handbook 4000.1 once the following repairs and/or inspections have been completed:

1) Water Heater: Seismically Strap (Estimate $200)

2) Smoke and CO alarms: Install smoke alarm in each sleeping area and one where sleeping areas cluster. Install one CO alarm. (Estimate $100)

3) Foundation: Inspection and certififcation by registered profession engineer that the foundation meets the requires of HUD Publication PFGMH (Permanent Foundations Guide for Manufactured Housing) (Estimate $200 for inspection and issuance of certifications assuming no changes needed.) The engineering firm should also inspect the wood decking to verify it is not attached to the manufactured home and is free standing. There has been no State permit for this on file.

4) Repair water leak from master bathroom sink which is leaking into the crawl space. (Estimate cost $100 if repaired at the same time as water heater service.)

At a minimum, and unless otherwise noted, the following steps were taken in arriving at the final opinion of market value: After receiving the assignment: (1) Online public data and MLS data pertaining to the subject was obtained from the appraisers sources. A preliminary search was made to determine market trends and other significant factors pertinent to the subject property. (2) A complete, on-site visual observation of the property was completed on the effective date of this report. Calculations and reported GLA is approximate and is considered accurate for purposes of reasonable comparison. (3) A detailed review of market sales was extracted from various sources including real estate brokers and agents, principals, county and/or city records, appraisers files, other appraisers. See data source section in the market grid. Replacement cost data and market rental data were considered and if applicable and necessary, the result of the analysis was reported. Any additional steps required to supplement this minimum scope of work are described elsewhere in this report, either in the comment cells in the body of the form report or in attached addenda. The development of this appraisal is based on the standard assumptions and limiting conditions included in the preprinted form attached to this report.

The subject improvements consist of a manufactured home and there was no attic to inspect. The crawl space was entered (head and shoulders) and observed. See attached photos.

The well and septic drain field are about 100' or more from each other and meet HUD requirements located in 24 CFR § 200.926d (f) (3). As stated in the narrative section of this report, there are no public water or sewer systems in the outlying, unincorporated areas of Fort Bragg. Private, on-site systems are used.

Prior Services Statement: I have not been engaged for any prior service related to the subject property within the last 3 years.

Notes on the Cost and Income Approaches:
The income approach was considered but is not typically completed for single family residential properties in this market and was not necessary in developing credible assignment results. The client did not require completion of this approach to value.

The cost approach was considered and was required by the client as part of the assignment conditions. See attached exhibits for cost estimate (using data from the California Board of Equalization's CA AH531 - Residential cost handbook and AH535 Rural costs handbook.); site value support; comments.

 

Tom4value

Member
Joined
Dec 4, 2016
Professional Status
Certified Residential Appraiser
State
Massachusetts
CANative did a good job of providing verbiage (keeping in mind that not everything will be needed for all assignments).

My question is you say you haven’t done an FHA assignment in years. Are you still FHA approved? They will need to assign a case number just to you and to do that, you have to be on the FHA roster.
 

RSW

Elite Member
Joined
Feb 18, 2002
Professional Status
Certified Residential Appraiser
State
Tennessee
CANative did a good job of providing verbiage (keeping in mind that not everything will be needed for all assignments).

My question is you say you haven’t done an FHA assignment in years. Are you still FHA approved? They will need to assign a case number just to you and to do that, you have to be on the FHA roster.
I don't mean to pick on you, but where do you get your information? It is not necessary for the Lender to have the appraiser name and license number in order to generate a case #. It used to be that way and was changed several years ago. Read the 4000.1.
 

Tom4value

Member
Joined
Dec 4, 2016
Professional Status
Certified Residential Appraiser
State
Massachusetts
I don't mean to pick on you, but where do you get your information? It is not necessary for the Lender to have the appraiser name and license number in order to generate a case #. It used to be that way and was changed several years ago. Read the 4000.1.
I get that from fairly recently from a client who asked me because they wanted to give me an FHA order. Can you provide proof of that? Not that I want to have an argument. I am just curious.
 

RSW

Elite Member
Joined
Feb 18, 2002
Professional Status
Certified Residential Appraiser
State
Tennessee
I would have to look up the ML letter in reference to that change.
 

CANative

Elite Member
Joined
Jun 18, 2003
Professional Status
Certified Residential Appraiser
State
California
You guys could hire me to complete an appraisal using the FHA protocols and even give me your AFHA # and I would do it. Do I care where it's really going? No.
 

BreJune

Thread Starter
Freshman Member
Joined
Jan 28, 2014
Professional Status
Certified Residential Appraiser
State
Colorado
Thank you for the information. I did complete the re-inspect, since I typically don't complete all the FHA requirements on conventional loans.


You have to take this as a new assignment. You will have to return to the site and comply with all of the inspection requirements (crawl space, attic, test appliances, test water pressure, etc, etc. The list is long.) This will trigger a new effective date and that will capture the requirement for order/ED being right.) You will have to do the 3 year dislosure thing.

If you need some sort of narrative template, here is a start. You can punch it up if you like.


Scope of work clarifications, intended use and user(s), additional client requirements:
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 identified as the intended users of this 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. A Home Inspection by a licensed Home Inspector is recommended. Refer to the HUD document "For Your Protection Get A Home Inspection." The client requested the FHA Case Number be positioned in the upper right corner under iinternal file number.

The subject property meets HUD Minimum Property Requirements as described in HUD Handbook 4000.1 once the following repairs and/or inspections have been completed:

1) Water Heater: Seismically Strap (Estimate $200)

2) Smoke and CO alarms: Install smoke alarm in each sleeping area and one where sleeping areas cluster. Install one CO alarm. (Estimate $100)

3) Foundation: Inspection and certififcation by registered profession engineer that the foundation meets the requires of HUD Publication PFGMH (Permanent Foundations Guide for Manufactured Housing) (Estimate $200 for inspection and issuance of certifications assuming no changes needed.) The engineering firm should also inspect the wood decking to verify it is not attached to the manufactured home and is free standing. There has been no State permit for this on file.

4) Repair water leak from master bathroom sink which is leaking into the crawl space. (Estimate cost $100 if repaired at the same time as water heater service.)

At a minimum, and unless otherwise noted, the following steps were taken in arriving at the final opinion of market value: After receiving the assignment: (1) Online public data and MLS data pertaining to the subject was obtained from the appraisers sources. A preliminary search was made to determine market trends and other significant factors pertinent to the subject property. (2) A complete, on-site visual observation of the property was completed on the effective date of this report. Calculations and reported GLA is approximate and is considered accurate for purposes of reasonable comparison. (3) A detailed review of market sales was extracted from various sources including real estate brokers and agents, principals, county and/or city records, appraisers files, other appraisers. See data source section in the market grid. Replacement cost data and market rental data were considered and if applicable and necessary, the result of the analysis was reported. Any additional steps required to supplement this minimum scope of work are described elsewhere in this report, either in the comment cells in the body of the form report or in attached addenda. The development of this appraisal is based on the standard assumptions and limiting conditions included in the preprinted form attached to this report.

The subject improvements consist of a manufactured home and there was no attic to inspect. The crawl space was entered (head and shoulders) and observed. See attached photos.

The well and septic drain field are about 100' or more from each other and meet HUD requirements located in 24 CFR § 200.926d (f) (3). As stated in the narrative section of this report, there are no public water or sewer systems in the outlying, unincorporated areas of Fort Bragg. Private, on-site systems are used.

Prior Services Statement: I have not been engaged for any prior service related to the subject property within the last 3 years.

Notes on the Cost and Income Approaches:
The income approach was considered but is not typically completed for single family residential properties in this market and was not necessary in developing credible assignment results. The client did not require completion of this approach to value.

The cost approach was considered and was required by the client as part of the assignment conditions. See attached exhibits for cost estimate (using data from the California Board of Equalization's CA AH531 - Residential cost handbook and AH535 Rural costs handbook.); site value support; comments.
 

BreJune

Thread Starter
Freshman Member
Joined
Jan 28, 2014
Professional Status
Certified Residential Appraiser
State
Colorado
CANative did a good job of providing verbiage (keeping in mind that not everything will be needed for all assignments).

My question is you say you haven’t done an FHA assignment in years. Are you still FHA approved? They will need to assign a case number just to you and to do that, you have to be on the FHA roster.
Yes I am still on the roster.
 
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