More comps, please!

[Mike Boyd]

You have completed an FHA report and it has been sent to the client. 2 weeks later, the client calls and says underwriting has requested 2 new comps that have sold in the past 60 days, that are similar to the subject (and maybe other "requirements.")

Assuming it is a good report and that your final value is well supported, What DO you do?

My position has always been that the report is for FHA. The lender may use it...but that's it! They do not have a right to request any additional documents that FHA does not require.

They can appeal to the local HOC, in which case the HOC can request a copy of the report, review it and decide. I have never had a situation where FHA has requested anything additional from me. A request for reconsideration of value or a complianace inspection report are FHA required documents, if called for. I know of no others.

Anyone have any experience to the contrary?

 

[Roy Courtney]

When I receive a request for additional comparable sales I refer them to page 5 of 6 in the appraisal, Item #7 of the Appraiser's Certification. "I selected and used comparable sales that are locationally, physically, and functionally the most similar to the subject property." I then advise the client that I will be happy to supply additional sales in a seperate document for their information. This additional information will not be a part of my appraisal. I charge a fee of $50.00 per comparable using MLS photos. After I tell them this they usually determine that they do not need additional comparables.

 

[CANative]

The report is not just for FHA. It's for the client that is actually lending money. FHA is an intended user... a user which is not lending any money but rather deciding on whether or not to issue mortgage insurance.

So I would not reject the client's request for additional "comps" based on your position. I might reject the request for other reasons though.

 

[TJSum]

If the request came from the DEU, yes I would comply, anyone else, I would tell them to take a hike. This is as long as they are not asking for data after the effective date of the original report. Our job and SOW is not to supply a specfic number of comps, it is to fully support our value opinion. Yes, there are times when these request are not realistic, usually a letter explaining the situation will be accepted instead for those type of circumstances.

 

[Mike Garrett RAA]

They can request anything, what you decide to provide is up to you. Much of the time this type of request stems from the appraiser's failure to adequately describe what they did. I have comments that say something to the affect..."these are the best comps available, there are no others that would more accurately reflect the present market".

 

[Chris Colston]

Request, in writing, from the DEU are honored.

Next problem, how do you know it is coming from the DEU? Do you know who that person is? Do you know who the final funding lender will be? That's where the DEU is.

 

[CGgonnabee]

"They can request anything, what you decide to provide is up to you. Much of the time this type of request stems from the appraiser's failure to adequately describe what they did."

I totally agree that we sometimes write comments that are clear in our minds but clear as mud when they hit the paper. However, sometimes they don't read what we write, regardless of its clarity! m2:

 

[Ariba]

Here is a request that I recently receive. "Thank you for submitting the report on the above property. However, there are some revisions needed before we can submit it to our client. We need 2 listings to support the declining market. Need more support for the declining market."

Told them to read the report. The declining market was addressed in the report. Listings was not part of the original SOW.

 

[c w d]

They can request anything, what you decide to provide is up to you. Much of the time this type of request stems from the appraiser's failure to adequately describe what they did. I have comments that say something to the affect..."these are the best comps available, there are no others that would more accurately reflect the present market".

Well dang Mike, if only I knew it was that easy "these are the best comps, no others available". Funny, I told a client two months ago that very same thing 5 times for an appraisal in a rural area. And instead of it just being a common response, it was actually true. But, the client just couldn't understand that. Oh, unless you wanted to consider the cookie cutter upscale homes located 6 miles away in the PUD community of "World Golf Village" for a subject that was on acreage in an unrecorded neighborhood. Not exactly comparable but, hey! They're more sales and close too. Of course, all this was explained in the report the first time around. So what was it the client was looking for that I did not address? I know....I know.....you don't know.....and neither do I.....to this day. Because all I ever got out of them was "2 more comps" "2 more comps" *squawk* "2 more comps".

I've gotten requests for additional comparables when I've provided 5 originally (3 closed, 1 pending, 1 sold) all within a mile and 6 months for a $75,000 home. But hey! "Give us 2 more comparables please. Why? We don't know."

It's easy to say to another appraiser "Obviously you didn't address something you should have.". No Mike. You can't address EVERYTHING you should have when the rules on the lender's side are unknown and change constantly irregardless of the known FNMA and Freddie requirements.

The fact is, Mike, there are times when we know why they want additional comparables and times when we are floored and confused that they continue to request additional comparables. So, really, I don't think we can know why they want additional comparables in some cases. And I don't think they know either but, that's what they're compliance software is telling them.

Sorry....I went a off on you here. Your statement about "you didn't address something you should have" just sent me over the edge.

 

[Roy Courtney]

The market area for each of us is different. When you work in an area where there is plenty of sales data it is not much problem to just send two more comps. I returned to the office this afternoon after taking photos of three comps. This photo trip required that I travel 144.9 miles round trip. Believe me at the price of gas I would have been happy to find closer comps. So I am impressed with an underwriter who could not find the subject property with a map just KNOWS that there are more and better comps. If I have a request from a mortgage broker for an appraisal in an area like this I make sure they discuss this situation with their underwriter before I accept. I have no desire to argue or fight with underwriters!