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FIRREA Addendum

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brunge

Thread Starter
Sophomore Member
Joined
Aug 24, 2002
Professional Status
Certified Residential Appraiser
State
Virginia
Is the inclusion of the FIRREA addendum a USPAP requirement or Fannie Mae or the ASB, or what? I could not find the answer in USPAP.

Is there specific verbiage that should be included in the FIRREA, if so where can I find it? The FIRREA form I use is from ACI and is blank.

Finally, should the FIRREA be included in Summary Appraisal Reports, Restricted Appraisal Reports, and all others?

Thanks
 

Jo Ann Meyer Stratton

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arizona
Where the problem arises is that the forms were developed in 1993 (URAR) and 1996 (2055, 2070, etc), all that was prior to the latest edition of USPAP (2002). There were some major changes to USPAP in 1999 and 2001 that appraisers should now be aware of. Fannie Mae insists on their 1993 version of limiting conditions (1004B) be included with every report that will end up with them. So to be in compliance with current USPAP (whichever version your state recognizes), it is necessary to attach an additional addendum that would be in compliance with current USPAP. Some of the software companies call them FIRREA addendum, some call them USPAP Compliance Addendum. Some of the software has blanks with those titles and some have pre-printed versions. Since Fannie Mae is not a Federally Related Transaction (Ben V will be happy to explain why), the heading of FIRREA might be confusing. You could take what every pre-printed form you have with your software and compare it to the latest USPAP and see if you agree with it. Or you can use one of the blanks and write your own based on the latest USPAP. I have made the offer in the past to email a pdf file version of what I use if you are interested. [email protected]

And I am always looking for feedback to improve or correct my reports!

Also, do NOT use the multi-pupose addendum that some appraisers just love. That went out of date when Fannie Mae issued their new URAR form in 1993. The multi-purpose addendum was created to bridge the gap between the adoption of USPAP in 1990 and the revised URAR in 1993. Once it was developed in 1993, the multi-pupose addendum was no longer necessaary.

But any form report with a date of prior to 2002 has some defiencies regarding USPAP, so an additional addendum is necessary. That is not going to be spelled out any where--just the logical sequence of comparing the years!
 

Ross (CO)

Senior Member
Joined
Jan 17, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
It really is about time to do a major forms revision and house-cleaning of all the obsolete, out-dated and ridiculous form types which still linger within our (my) software's forms menus. --- It's about time to update and tweak some fields within the forms we regularly use today, as in the 1004, 2055, et al and etc., to close the gaps which raise those confusions experienced by both veteran and new appraisers. Add a few new data fields perhaps and eliminate a few which are insignificant. --- While those who create and approve forms are at it.....it's about time they also create a nationally-accepted and standardized appraisal ORDER FORM which lets our client inform us, in writing and in the beginning of an assignment, just WHAT the intended use is, WHO the intended users are, and some possible lead-in to the SCOPE of what our final product could be based upon. We should not have to guess, or assume, or call them back to ask for some of those things to be clarified. Our clients have access to PC's. Type the order. Hand-written orders should be discouraged. I've seen too much crappy penmanship. An example #1: The client / homeowner's estimate of value is NOT any part of any "scope" of the work. Drawing a "smiley face" next to the estimate number does not score points with me ! Example #2: They want a "drive-by", fine, then briefly state how, and why, our doing a drive-by satisfies the clients goals and allows us to then move forward with an at-best process to conclude the assignment. --- One should NOT NEED lengthy addenda pages to provide CYA documentation. The CYA process can and should be simplified. The USPAP can be written in 1/2 the total number of words and pages as in the present edition. I'll bet it can be done, and be more understandable, as well. I will give it this much, it IS less than the totality of the U.S. Tax Code ! But heh !, that's all just my opinion anyway, and I'm just this guy out here.......
 

bradellis

Member
Joined
Jan 16, 2002
Brian,

If you read FIRREA, the first thing you will notice is that appraisers are covered by Title XI and about all that is included in there is the need to conform to USPAP IF your state board has adopted USPAP (I think almost all have).

FIRREA really applies to the federally related lending activity and not to appraisers, per se. So the inclusion of any FIRREA addendum is essentially moot.

Your report must include the things outlined in Standard 2. Go by that and you will not be wrong- only do not forget now to include a scope of work statement along with intended use/users.

Brad Ellis, IFA, RAA
 

Jo Ann Meyer Stratton

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arizona
Brad:

That is why I wish the software producers would remove the title of FIRREA addendum from their forms--either don't have a title or or just change to Uniform Standards of Professional Appraisal Standards addendum at the top.

And I do wish the software companies would do some house cleaning with the forms they offer. They brag about having over 400 or 500 forms available. About 80% or more are obsolete, not used, scrambled versions of somebody's idea that didn't get reviewed by someone familiar with USPAP or Fannie Mae or Freddie Mac or HUD, so therefore they are not really usable. I have the Day One and Nova programs and there is way too many forms in the package. And I bought the simplest package I could find! Adding useless forms to a package does not enhance the product!! Software companies---are you listening???
 

Ross (CO)

Senior Member
Joined
Jan 17, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
Very well said, Jo Ann ! Now, if only about 85,000 more would speak in a similar consenting request, then maybe all those (software) product development groups would get up-to-date on pertinent forms to offer and all those other forms to chuck ! Boy, I sure do hope that the 2003 "handbook" for our profession can be as exhilorating and refreshing as any version has ever been. We are so due something like that ! The variety and content of just this Forum cries out for more simplicity and "understandability". Some citizens proudly carry around a breast-pocket copy of a printing of the Constitution of the United States. I wonder if USPAP will ever get down to such a size.
 
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