Judge Rules Appraiser/Lender Owe no duty of care

[Huds_Harm]

She paid $650. She should get out the settlement HUD 1 and see how much Class took out of the fee, and send that to Rohit Chopra.

They took $200

 

[Huds_Harm]

Bayou how much were charged by Class for your appraisal?

$650 and they took $200 to pay appraiser $450

 

[George Hatch]

I don't work in the FHA pipelines so I'm not conversant with all the details of their appraisal policy but if the septic system was in operating condition as of the date of the appraisal then there is no "completion or repair" to be made. Repairs might be necessary for some of the other deficiencies, though. If the lender made the loan and FHA bought it and is holding it then the financing end of the transaction is stable - no damages to either of them at this point. If FHA wants the lender to repurchase the loan that would actually be between the lender and FHA. If the lender wants to seek damages from the appraiser that's between the lender and the appraiser.

So my read is that what you're looking for is the remediation to be covered which your own due diligence did not discover. The septic didn't fail because it was located that close to the house, it apparently failed because it failed.

I might be wrong about this but my understanding of it is that FHAs requirements are intended to protect their own interests, not to serve as a guarantee or warranty program in service of your interests.

The courts have surely seen complaints with comparable circumstances before so it's possible (although I don't know one way or the other) that the judge might not even have had the discretion to rule otherwise. But that's a question for the lawyers, not us lowly appraisers.

 

[Mejappz]

$650 and they took $200 to pay appraiser $450

Yeah unfortunately you got ripped off. In a real market, you would have been charged about 30% less and had qualified appraisers do a good job. I’m sorry you have had to go through this mess but Class is known to hire the worst of the worst.

 

[Huds_Harm]

I don't work in the FHA pipelines so I'm not conversant with all the details of their appraisal policy but if the septic system was in operating condition as of the date of the appraisal then there is no "completion or repair" to be made. Repairs might be necessary for some of the other deficiencies, though. If the lender made the loan and FHA bought it and is holding it then the financing end of the transaction is stable - no damages to either of them at this point. If FHA wants the lender to repurchase the loan that would actually be between the lender and FHA. If the lender wants to seek damages from the appraiser that's between the lender and the appraiser.

So my read is that what you're looking for is the remediation to be covered which your own due diligence did not discover. The septic didn't fail because it was located that close to the house, it apparently failed because it failed.

I might be wrong about this but my understanding of it is that FHAs requirements are intended to protect their own interests, not to serve as a guarantee of the condition of the property on behalf of your interests.

The courts have surely seen complaints with comparable circumstances before so it's possible (although I don't know one way or the other) that the judge might not even have had the discretion to rule otherwise. But that's a question for the lawyers, not us lowly appraisers.

The septic system did not meet minimum distance requirements between septic and well working or not.

By definition, an FHA appraisal is to determine the following:

• Safety: The home should protect the health and safety of the occupants.
• Security: The home should protect the security of the property.
• Soundness: The property should not have physical deficiencies or conditions affecting its structural integrity.

 

[Huds_Harm]

Yeah unfortunately you got ripped off. In a real market, you would have been charged about 30% less and had qualified appraisers do a good job. I’m sorry you have had to go through this mess but Class is known to hire the worst of the worst.

So I have learned.

 

[shrubberyvaluation]

This results from prioritizing fast and cheap by opting for an AMC-like Class. I'm curious about how many inspections this appraiser completed the day he inspected your property. And Rocket Mortgage is notorious for leaving the appraisal for the last thing in the process.

I always hear bad things about Rocket Mortgage from agents, especially with their hybrids.

 

[George Hatch]

By the description none of the health and safety requirements had emerged as of the date of the appraisal. The tank's location may be out of compliance with current development criteria but that doesn't mean the location poses an inherent risk to health and safety. Or structural integrity. I'm not saying that to be argumentative or to suggest that the appraiser met FHA requirements, but by itself a 10ft distance actually exceeds the minimum 5ft distance requirement that I have previously seen in certain jurisdictions So not everyone agrees a 10ft distance is an inherent risk to health and safety.

The point I was trying to make is that non-compliance with the lender's underwriting criteria doesn't automatically equate to the tank location posing an inherent risk to health and safety that the appraiser should have noticed. The previous occupants of the home most likely survived that situation for many years. You just happened to be in the wrong space/time when the septic system failed. Had it not failed it wouldn't have become a problem for you. Where would you be and what would you have been able to do if this failure hadn't occurred within the first couple years of ownership?

Offhand, I would guess that probably half of the FHA-qualified appraisers would have missed this issue, regardless of how much they got paid.

 

[shrubberyvaluation]

She paid $650. She should get out the settlement HUD 1 and see how much Class took out of the fee, and send that to Rohit Chopra.

Im gonna guess appraiser got between $150-$200

 

[shrubberyvaluation]

Isn't class the one that brags to lenders about how much pressure it applies to appraisers?