Market and 90 Day Values.

[George Hatch]

It it were me, I'd do MV in the 1004 because that's the definition that goes with that form. Then I'd add the Disposition Value (your 90-day value) either on an addenda form from your formsware package or I'd just freehand it in your written narrative addenda. The thing to bear in mind on this is that whatever definitions of value you're using in an assignment you also need to cite each definition.

 

[Terrel L. Shields]

Use sales with only 90 DOM or less.

 

[J Grant]

Use sales with only 90 DOM or less.

NO . They can be used of course, but IMO need not be the only sales.

 

[George Hatch]

If the prevailing market conditions include shorter exposure times it won't matter if you include a couple that cross an arbitrary limitation in exposure times - the others will usually still close at the same pricing.

 

[sputnam]

It it were me, I'd do MV in the 1004 because that's the definition that goes with that form. Then I'd add the Disposition Value (your 90-day value) either on an addenda form from your formsware package or I'd just freehand it in your written narrative addenda. The thing to bear in mind on this is that whatever definitions of value you're using in an assignment you also need to cite each definition.

View attachment 82854

Spot on. Keep in mind that sometimes the market value and the 90 day liquidation value will be the same. Sometimes not. Either way, you have to state the type and the definition and the source of the definition for every type value that is included in your appraisal report.

 

[Tom D]

the 90 day rule has been around forever, especially with foreclosures. not quite sure why that number hasn't changed. right now it is more for a changing market, maybe a market crash going down, or ever increasing values. when listings were being sold in less than a week a 90 day prediction is what. with this market, not breaking new highs, what does 90 days from now mean. most will not know this but long ago, and for a long time, listings would take 6 months or more to sell, so the 90 days was more of a quick sale number. so in terms of history that's where the 90 day number came from. since then, it has never been readjusted, just like the way FHA does some things.

 

[J Grant]

A 90-day value means the property would be expected to sell at 90 days or below - which could be 5 days or any amount; I agree that rule was more in tune when things used to take 4-6 months or more to sell.

I do see marketing time creeping up, though; properties that used to be snatched up in 5 days are now on the market for 30 -60 days; idk if the small decrease in interest rates will affect that or not.

A client can impose within 30 days or any market exposure time limit they want - and note that that on a foreclosure REO appraisal, a lender client is usually not asking that the second value be a disposition or value or liquidation value ( typically)

Keep in mind that disposition value and liquidation value are not solely convened to a DOM limitation. Their definitions contain specific language about a limited or severely limited marketing effort and the seller's motivation.-

Unless the client specifies either liquidation value or disposition value ( ask the client if you are not sure, ) then the second value opin is explained as MV but with a limited to 90 days or whatever - the expectation being a normal marketing effort is made such as MLS listed, (unless noted as such as an assignment condition )

IMO, there were some severely underpriced REO sales due to appraiser stupidity back in the day and the banks lost money on them because of it. JMO but appraisers under valuing on an REO is as bad as over valuing it, sure , anything will see if you under price it enough - which may or may not be what a client is asking for.

 

[George Hatch]

LV refers to "severely limited future marketing period specified by the client"

It doesn't have to be 90 days. It's common for lenders to use that period, but they could also use other periods.