Mortgage office wants change to non-owner occupied?

[mdtulips]

Okay, I need help because I have never heard of this before and I smell a rat. I did an appraisal back in March of a condo. Everything went well.
Now, I get an email from the loan officer asking me to change the report to non-owner occupied because the borrower's "accountant" got a counteroffer to non-owner occupied. The issue is that the owner DOES live in the condo, but has a roommate who rents a room for $729. Market rents in that area are typically around $1800-$2,000. I have never heard of this "counteroffer" before and this just doesn't make sense to me. This just doesn't sound kosher because the owner does lives in the condo. Any advice would be appreciated.

 

[ghrousseau]

Okay, I need help because I have never heard of this before and I smell a rat. I did an appraisal back in March of a condo. Everything went well.
Now, I get an email from the loan officer asking me to change the report to non-owner occupied because the borrower's "accountant" got a counteroffer to non-owner occupied. The issue is that the owner DOES live in the condo, but has a roommate who rents a room for $729. Market rents in that area are typically around $1800-$2,000. I have never heard of this "counteroffer" before and this just doesn't make sense to me. This just doesn't sound kosher because the owner does lives in the condo. Any advice would be appreciated.

Lenders do that all the time. They can make the determination about intended use of the property. Borrowers fib all the time about "second homes" that are really rented out. You may want to treat it as a new assignment though and check for more recent sales and re-inspect the property. Also, don't forget to ask if they need a rent survey and a 216. LO's are notorious for forgetting to check with the underwriter only to find out they need one rushed at last minute prior to closing. If they are using the income to qualify on the loan, then there is a good chance they need a rent survey to meet the investor requirements per DU or LP findings.

 

[Randolph Kinney]

Okay, I need help because I have never heard of this before and I smell a rat. I did an appraisal back in March of a condo. Everything went well.
Now, I get an email from the loan officer asking me to change the report to non-owner occupied because the borrower's "accountant" got a counteroffer to non-owner occupied. The issue is that the owner DOES live in the condo, but has a roommate who rents a room for $729. Market rents in that area are typically around $1800-$2,000. I have never heard of this "counteroffer" before and this just doesn't make sense to me. This just doesn't sound kosher because the owner does lives in the condo. Any advice would be appreciated.

Your appraisal assignment was complete back in March for the conditions and SOW then.

If the LO wants to change the assignment conditions and SOW now, that is a new assignment and a new appraisal. Charge accordingly. There is no reason to go back and change the old report unless you made a mistake.

 

[Kevin Mc]

If the owner lives there and you know it, that is the way it is. Had they done their homework ahead of time they could have set it up so that the person you met the day of inspection was the "tenant" and then they could have used the income for their loan application(which is what they are trying to do now). It is what it is. If the owner lives there, he lives there. Tell the accountant next time to line up his ducks prior to pulling the trigger.

 

[RSW]

What address is the tax bill sent to for the subject property? Does it have the borrower's name on it? If it is at the same address of the subject then it should be owner occupied. I have run into this before and I have asked the LO to fax me a copy of the borrower's drivers license in order to see if it has a different address than that of the subject property. Owner occupied. He may have a roommate, but it is still owner occupied.

 

[Lee Lansford]

Okay, I need help because I have never heard of this before and I smell a rat. I did an appraisal back in March of a condo. Everything went well.
Now, I get an email from the loan officer asking me to change the report to non-owner occupied because the borrower's "accountant" got a counteroffer to non-owner occupied. The issue is that the owner DOES live in the condo, but has a roommate who rents a room for $729. Market rents in that area are typically around $1800-$2,000. I have never heard of this "counteroffer" before and this just doesn't make sense to me. This just doesn't sound kosher because the owner does lives in the condo. Any advice would be appreciated.

If the owner lives in the Subject...with another person who pays the owner rent...the Subject remains owner-occupied.

 

[mdtulips]

What address is the tax bill sent to for the subject property? Does it have the borrower's name on it? If it is at the same address of the subject then it should be owner occupied. I have run into this before and I have asked the LO to fax me a copy of the borrower's drivers license in order to see if it has a different address than that of the subject property. Owner occupied. He may have a roommate, but it is still owner occupied.

I asked more questions of the loan officer since the original time of posting and found out that she just got divorced, so she moved into the subject property right before I did the first appraisal. Prior to that, it was a "second" home. Tax records now show she just had a quitclaim deed with now her as the only party on title.
Thank you for all your responses.

 

[mdtulips]

If the owner lives there and you know it, that is the way it is. Had they done their homework ahead of time they could have set it up so that the person you met the day of inspection was the "tenant" and then they could have used the income for their loan application(which is what they are trying to do now). It is what it is. If the owner lives there, he lives there. Tell the accountant next time to line up his ducks prior to pulling the trigger.

Borrower was in her bathrobe, when I go there at 7:30 am. Go figure.

 

[hastalavista]

If the owner lives in the Subject...with another person who pays the owner rent...the Subject remains owner-occupied.

It really isn't any more complicated than that, is it? :icon_wink:

 

[RSW]

The owner lived there at the time you visited the subject property. That is the effective date of your appraisal. Owner occupied as of the effective date of your report.