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How A New Lender Obtains A Revision To An FHA Report

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azbassman21

Junior Member
Joined
Apr 1, 2011
Professional Status
Certified Residential Appraiser
State
Arizona
DISCLAIMER: I'm not trying to be redundant as I know this topic had been discussed ad nauseum. I searched the forum and exhausted several sources for this info, aside from calling the local HUD office. I simply could not find this specific answer and appreciate any help you can provide.

I completed a 1004C FHA assignment about 3 months ago. I revised the file for the original client once, and didn't hear back from them. I then got an email 3 weeks ago from a loan officer from a different lender saying I needed to revise the report as the underwriter needed some more info. I told them I couldn't, as they are not my client and not the intended user and they could have the original client order the revision or simply order a new assignment. 1 week ago I get a call from the buyer's agent, asking me what can be done as the underwriter will not budge on the conditions and there is no way to uiltize a new assignment as the FHA case number transferred with the property, and that appraisal sticks with the property for another month. They went through the original client and the client said they would not order the revision.

I'm not a guy who will just tell someone to go pound sand because I can. I believe in helping others in the industry and providing assistance when I am able to, and when it is legally permissable to do so.

What are the solutions to something like this? I would like to help in whatever way possible, but I also see from the agent's perspective they are between a rock and a hard place, with no other options. Anyone have any experience with this?

Thanks in advance.
 

glenn walker

Elite Member
Joined
Oct 11, 2006
Professional Status
Certified Residential Appraiser
State
California
First before all us talking heads get going - Call your HOC Today and give them your case number and what's being requested - Our HOC has told us many times to assist the Underwriter and do no harm to the buyer unless the request are simply unreasonable because if the buyer cannot perform and the seller cancels escrow you have some liability.

First question is have you been paid for the report ? If not don't do anything - Second the FHA appraisal and case number is fully portable to a new lender and the new FHA DE Underwriter can request you make corrections or address issues. Your report should also have the statement similar to whats below because your HOC will give you a deficiency if FHA/HUD reviews your appraisal because actually they are a user and the most important one because they are insuring the mortgage ** THE INTENDED USE OF THE REPORT IS TO SOLELY ASSIST FHA/HUD IN ASSESSING THE RISK OF THE PROPERTY SECURING A FHA INSURED MORTGAGE AND FHA/HUD AND XYX BANK ARE THE INTENDED USERS OF THE APPRAISAL REPORT. * NOTE: You don't have to change the name of the lender on the assigned report.

Now you have to make a decision
do you want to force the existing lender and borrower to get a new appraisal or simply make the corrections ? If the lender has to get a second appraisal the lender must inform your HOC that your appraisal was deficient in some area or you would not co-operate and the buyer was being damaged by not being able to close their loan-Blah-Blah-Blah The problem here is your HOC may very well review your appraisal and find the new FHA-DE Underwriter had legitimate concerns and that's when things start going bad for you and worse is if the buyer files a complaint with HUD then you have to have a good reason for not making the corrections.
 

Terrel L. Shields

Elite Member
Gold Supporting Member
Joined
May 2, 2002
Professional Status
Certified General Appraiser
State
Arkansas
new FHA DE Underwriter can request you make corrections
That is not what the statement I posted above says. I interpret to say that is the believe material differences exist, then they are REQUIRED to order a new appraisal. Nothing can force me to create a new Client-appraiser relationship with lender # 2.
 

Howard Klahr

Senior Member
Joined
Oct 4, 2004
Professional Status
Certified General Appraiser
State
Florida
What is the information being requested by the second underwriter?
 

azbassman21

Junior Member
Joined
Apr 1, 2011
Professional Status
Certified Residential Appraiser
State
Arizona
Took about 2 seconds to find this
View attachment 33796

Terrel, I appreciate your knowledge and experience in this industry, as I'm sure most people do. You've probably forgotten more about appraising than I know in my short career. But can you save the the smart a** remarks? Several times you've responded to people in this manner, and on a forum designed for all of us to gather and share information, stories, knowledge, etc., it gets old. I found that exact excerpt and it doesn't apply here.

I'm reaching out to get suggestions on a solution which involves a little compassion and common sense, not red tape and a stern "NO" just because I don't have to. BTW, none of those conditions exist in this case, which is why I prefaced my post and asked the forum for guidance. No metarial deficiacies, just a stubborn underwriter and a desperate buyer and seller.

I understand the relationship with the original client, however in the case there is not material deficiencies in the original report, which in this case there was not, as the second underwriter wanted clarification on something to do with the fence on the property and calrification on another irrelevant item, which was again, not a material deficiency. I was able to assist the second lender in pushing the first lender to funnel the revision through them, which turned out to be no big deal. I may have even gained a new client out of it, and a spot on the preferred vendor list at a prominant brokerage in town. And it just took me 5 minutes.
 

azbassman21

Junior Member
Joined
Apr 1, 2011
Professional Status
Certified Residential Appraiser
State
Arizona
First before all us talking heads get going - Call your HOC Today and give them your case number and what's being requested - Our HOC has told us many times to assist the Underwriter and do no harm to the buyer unless the request are simply unreasonable because if the buyer cannot perform and the seller cancels escrow you have some liability.

First question is have you been paid for the report ? If not don't do anything - Second the FHA appraisal and case number is fully portable to a new lender and the new FHA DE Underwriter can request you make corrections or address issues. Your report should also have the statement similar to whats below because your HOC will give you a deficiency if FHA/HUD reviews your appraisal because actually they are a user and the most important one because they are insuring the mortgage ** THE INTENDED USE OF THE REPORT IS TO SOLELY ASSIST FHA/HUD IN ASSESSING THE RISK OF THE PROPERTY SECURING A FHA INSURED MORTGAGE AND FHA/HUD AND XYX BANK ARE THE INTENDED USERS OF THE APPRAISAL REPORT. * NOTE: You don't have to change the name of the lender on the assigned report.

Now you have to make a decision
do you want to force the existing lender and borrower to get a new appraisal or simply make the corrections ? If the lender has to get a second appraisal the lender must inform your HOC that your appraisal was deficient in some area or you would not co-operate and the buyer was being damaged by not being able to close their loan-Blah-Blah-Blah The problem here is your HOC may very well review your appraisal and find the new FHA-DE Underwriter had legitimate concerns and that's when things start going bad for you and worse is if the buyer files a complaint with HUD then you have to have a good reason for not making the corrections.

Glen, thank you for your response. Very helpful indeed!
 

Mr Rex

Elite Member
Joined
Jan 12, 2004
Professional Status
Certified Residential Appraiser
State
North Carolina
(8) Transferring Existing Appraisals
In cases where a Borrower has switched Mortgagees, the first Mortgagee must, at the Borrower’s request, transfer the appraisal to the second Mortgagee within five business days.
The Appraiser is not required to provide the appraisal to the new Mortgagee.
The client name on the appraisal does not need to reflect the new Mortgagee.
If the original Mortgagee has not been reimbursed for the cost of the appraisal, the Mortgagee is not required to transfer the appraisal until it is reimbursed.
The second Mortgagee may not request the Appraiser to re-address the appraisal.
If the second Mortgagee finds deficiencies in the appraisal, the Mortgagee must order a new appraisal.
Where a Mortgagee uses an existing appraisal for a different Borrower, the Mortgagee must enter the new Borrower’s information in FHAC.
The Mortgagee must collect an appraisal fee from the new Borrower and refund the fee to the original Borrower.
If a Case Transfer is involved, the new Mortgagee must enter the Borrower’s information in FHAC.
The new Mortgagee must collect an appraisal fee from the Borrower, and send the fee to the original Mortgagee, who, in turn, must refund the fee to the original Borrower.
 

azbassman21

Junior Member
Joined
Apr 1, 2011
Professional Status
Certified Residential Appraiser
State
Arizona
Again, no deficiencies in this report. Just simple underwriter clarification, beating a dead horse type thing.

But if the FHA appraisal goes with the property for 4 months, if they order a new appraisal must they prove there were significant deficiencies in the report to utilize the second report or how does that work?
 
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