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Loan Officer hit 220,000 or stop appraisal

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rdennistompkins

Thread Starter
Freshman Member
Joined
Jan 6, 2004
Professional Status
Certified General Appraiser
State
Illinois
oh, I got another good one. I tried to back out of the order as I did not feel i could be objective after receiving the following email (the names of the guilty parties have been changed to protect myself, not the guilty parties). Here is the information that I received which was sent to my appraiser:

From: GUILTY PARTY # 1
Sent: Thursday, December 20, 2007 7:56 AM
To: MY INDEPENDENT OBJECTIVE IMPARTIAL APPRAISER
Subject: LOAN OFFICER WANTS YOU TO STOP IF YOU CANNOT HIT THE NUMBER



aPPRAISER:



guilty loan officer # 1 called me about the request for borrower XXXX (I think that was the name).



He said that this value has to be $220-230 to make loan work. Borrower thinks there are comps to support this now. Earlier in year, the borrower tried to do this and value came in at $205.



GUILTY LOAN OFFICER asked that if we look at comps and value isn't there, stop report. He said if you have to go out and look at property and it won't come in, he will pay for trip charge. He wants to avoid full appraisal expense if not able to close loan.


OF COURSE THIS DIRECTION VIOLATES USPAP, THE REQUIREMENTS OF THE LENDER AND THE MANAGEMENT COMPANY WHO ORDERS THE APPRAISAL REPORTS FOR THE LENDER, ETC.

I tried to back out of the order as I did not feel we could be objective, independent and impartial; however, the management company just told me to go out and do it and send in the report which we did. now, s..t will hit the fan. Hope the fan is not pointed in my direction. LOL

the management company, the lender, are all wonderful and very supportive. it is hard to get good clients like this and i do appreciate the back up from the lender and the management company. they take this OCC regulation of appraiser independence very seriously. the loan officer is not allowed to talk to the appraiser, the appraiser is not allowed to talk to the loan officer and we did not violate any of these policies, the LO left the appraiser a message and one person sent an email to my appraiser. which is shown above.

dennis tompkins
 

Marcia Langley

Senior Member
Joined
Aug 26, 2005
Professional Status
Certified Residential Appraiser
State
Missouri
they take this OCC regulation of appraiser independence very seriously. the loan officer is not allowed to talk to the appraiser, the appraiser is not allowed to talk to the loan officer

Good for them and I hope the LO in question gets diciplined.
 

Richard Carlsen

Elite Member
Joined
Jan 15, 2002
Professional Status
Licensed Appraiser
State
Michigan
Actually, you could do this request and be USPAP compliant. Here's how:

Let's suppose that you get to a point in the assignment where you have an opinion of value and it does not come up to $220K. At that point, you stop and send a report of your appraisal in the form of a Restricted Use Appraisal Report stating that in your opinion, the value of the subject is less than $220K.

What you charge is up to you but this can be turned into a perfectly valid, USPAP assignment if you know how to do it. You simply have the client send an order for an appraisal to be reported on a FNMA 1004 if the value is $220K or greater and in a Restricted Use Appraisal report if the value is less than $220K. Very simple.

(Now watch the nay sayers start jumping on me for the above post)
 

Randy Pippin

Sophomore Member
Joined
Dec 16, 2003
Professional Status
Certified Residential Appraiser
State
Georgia
Not quite a nay sayer here Richard as I don't know enough to start quoting all the rules but I do have a question about the scenario you describe. Doesn't the fact that I have an order in my hand asking for a restricted use appraisal UNLESS the value is $220K or above, in which case they want an appraisal on a FNMA 1004 put me in the position of taking an appraisal order contingent on arriving at a given value?
 

Richard Carlsen

Elite Member
Joined
Jan 15, 2002
Professional Status
Licensed Appraiser
State
Michigan
Not quite a nay sayer here Richard as I don't know enough to start quoting all the rules but I do have a question about the scenario you describe. Doesn't the fact that I have an order in my hand asking for a restricted use appraisal UNLESS the value is $220K or above, in which case they want an appraisal on a FNMA 1004 put me in the position of taking an appraisal order contingent on arriving at a given value?

Why is the order contingent on arriving at a given value?

The order reads: Appraise the subject. If the value is $220,000 or above, report the appraisal findings on a FMNA 1004. If the value is under $220,000, report the findings in a Restricted Use Appraisal report.

Remember that the appraisal is the appraisal. The reporting form is not the appraisal. One of the things that you will see when you read USPAP in the comments on Standards 2-2 that, with regards to the three reporting forms (Self Contained, Summary and Restricted Use), "The essential difference among these three options is in the content and level of information provided. The appropriate reporting option and the level of information necessary in the report are dependent on the intended use and the intended users."

For the client in this case, a value under $220,000 means that the loan cannot be made and the appraisal report form FNMA 1004 is not needed to include as support of the value level. Therefore, if the loan cannot be made, then there is no need for the level of information contained in a FNMA 1004 by the client. A Restricted Use Appraisal report will suffice to completely meet the clients needs. However, if the value is $220,000 or more, then the loan can be made and there is need by the client for a FNMA 1004 to be included in the lending package.

All the client is doing, and to which you are agreeing, is to appraise the property and depending on the opinion of value, report the results of the appraisal (opinion of value) on a reporting form that is commensurate with the information necessary for the Intended Users needs. In the case of the FMNA 1004, the opinion of value will be a specific number. In the case of the Restricted Use Appraisal report, the value reported will be, "Less than $220,000". Both are opinions of values from an appraisal.
 
Last edited:

Wayne Tomlinson

Senior Member
Joined
Jan 25, 2005
Professional Status
Certified General Appraiser
State
Illinois
It looks contingent to me.

I wouldn't care to spend an hour with our state board explaining to them why it is not contingent.

How much less would you charge if, after doing all the inspection necessary to make the determination of which form to use, then you chose the cheaper one. $25.00? $50.00?

Wayne Tomlinson
 

Wayne Tomlinson

Senior Member
Joined
Jan 25, 2005
Professional Status
Certified General Appraiser
State
Illinois
Oh Yeah!
Welcome to the forum Dennis.

Wayne Tomlinson
 

Richard Carlsen

Elite Member
Joined
Jan 15, 2002
Professional Status
Licensed Appraiser
State
Michigan
It looks contingent to me.

I wouldn't care to spend an hour with our state board explaining to them why it is not contingent.

How much less would you charge if, after doing all the inspection necessary to make the determination of which form to use, then you chose the cheaper one. $25.00? $50.00?



It does not matter what you charge. That is a business decision.

USPAP makes no mention of charging for an appraisal. You simply do the appraisal until you can form an opinion of value IAW USPAP requirements and then make the appropriate report using the appropriate reporting form.

 

Fred

Elite Member
Joined
Jan 15, 2002
Professional Status
Retired Appraiser
State
Virgin Islands
The order reads: Appraise the subject. If the value is $220,000 or above, report the appraisal findings on a FMNA 1004. If the value is under $220,000, report the findings in a Restricted Use Appraisal report.
The issue is not the type of report. The issue is the agreement.
 

leelansford

Elite Member
Joined
Mar 29, 2002
Professional Status
Certified Residential Appraiser
State
Illinois
Actually, you could do this request and be USPAP compliant. Here's how:

Let's suppose that you get to a point in the assignment where you have an opinion of value and it does not come up to $220K. At that point, you stop and send a report of your appraisal in the form of a Restricted Use Appraisal Report stating that in your opinion, the value of the subject is less than $220K.

What you charge is up to you but this can be turned into a perfectly valid, USPAP assignment if you know how to do it. You simply have the client send an order for an appraisal to be reported on a FNMA 1004 if the value is $220K or greater and in a Restricted Use Appraisal report if the value is less than $220K. Very simple.

(Now watch the nay sayers start jumping on me for the above post)

Is your fee the same under either of the two scenarios?

Frankly, what's the difference between the two? You're communicating an appraisal either way. Please...don't tell us that you would charge a lower fee for the Restriced Use report.

Please clarify...I'm not certain that I am fully understanding what you have offered.
 
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