Is the assignment type a Purchase?

[Tom D]

I am appraising a proposed FHA manufactured home that is being bought by the borrower to go on the property that he already owns.

i'm a little confused here. is the owner of the lot paying for the manufactured home out of pocket first, or is the lender paying for it at settlement. either or, it's a subject to completion and a refi especially if the owner is paying out of pocket 1st. if the manufacturer is waiting to be paid at settlement it's a refi. either way, you are the builder/developer. how it is built is not the lender's concern. that being said, have you banged your head on the wall enough. you can't cure stupidity, you can only endure it. so sale, but explain it very carefully and keep any correspondence from the lender, saying they want it this way. how do they explain the current owner's name and the buyer's name being the same on the appraisal. can you sell real estate to yourself that is already in your name..
but, the client is asking you to do it a very specific way. are they not allowed to.

 

[Mark K]

If the assignment type is purchase transaction, the appraiser must enter an amount for the contact price field. The contract section is only for sale contract, not a construction contract. Since there is no sale price, it must be a refi or other.

Since FHA requires the appraisal to be marked 'purchase', what would you suggest the appraiser do in this instance?

Options I see include:
1) Do as they require and include verbiage in your report that, in your opinion, this is not a purchase but that the 'purchase' box was checked due to FHA requirements
2) Decline the assignment
3) Argue with the client, telling them that FHA is wrong, and wait for them to agree with you
4) Refuse future FHA assignments since they obviously don't know what they're doing. I suspect that if you argue with them long enough, this won't be an issue since they'll take you off of their list.

 

[CGinMN]

Everyone has to determine their own level of comfort. I think someone from FHA provided an incorrect answer, so I would probably try to get the correct answer by escalating. If I wasn't successful, I would get their response in writing and include it in an addendum, then move on.

 

[Tim Hicks (Texas)]

FHA and VA can treat it as a purchase or any way they want. An appraiser cannot and should not because that is not the truth and would make the report misleading by USPAP standards.

 

[David S. Roberson]

Is this so confusing, or am I wrong that the client just wants to know how much they can sell the doublewide at foreclosure, and they want to base that decision on the value of what will be their collateral, within the guidelines of HUD?

 

[Tom D]

you are over thinking this. it's a value of the land & building on it. but i will tell you, that at this point of the thread you should give it back. you seem likely to get it wrong, well right, but not explained correctly. it is not a pre foreclosure appraisal. you never want the state to look at any appraisal you did. they have all day to find the little mistakes you did, to burn your bank account. this is how you survive in the long term. don't put your foot in an open bear trap.