New construction: as is vs subject to

[Dublin ohio]

Unreal- what a waste of time, no wonder folks drop out of this board pointless idiotic challenges to responses trying to help a poster.

Or is it posters that interject a bunch of ifs, ands or buts. Not mentioned or inferred in the op.

 

[glenn walker]

Or is it posters that interject a bunch of ifs, ands or buts. Not mentioned or inferred in the op.

The real issue is many don't read an entire post and suddenly interject opinions which often have no validity.
The scary part is appraisers are supposed to be detail oriented but 50% on here just shoot from the hip. Also in many of these situations there is no right or wrong answer and its simply a business and risk reward decision the appraiser has to make . I chose the "as is" route because it seems like the most logical but others may differ. In 90% off all these situations we are often our own worst enemy and can turn a mole hill into a mountain.

 

[TruJa]

I also run into this exact issue. I've just checked subject to completion because as of the effective date, they are contractually obligated to install the landscaping, so this is technically a hypothetical condition from an appraisal perspective. I read through the selling guide B4-1.2-03, and don't see where it says appraisal can be as-is (when it isn't) (it seems like this is a USPAP issue more than a Fannie Mae issue). Granted this is a minor issue in the scope of the improvements, but does the "as-is" checkbox need to be checked to close the loan? I have occasionally made a note that they intend to do an escrow holdback to finish (and then I still check the subject to box). Why not appraise it as it really is, and let the people who close the loan do their job? Am I doing this wrong?

What if they didn't install the landscaping and it didn't close for some other reason, and everyone was mad. If you checked "as-is" and everyone's lawyer was going back saying "No it wasn't complete", who could potentially get their wrist slapped now?

 

[ramrcdk]

There is no cost to cure on a escrow hold back those funds will not be released or disbursed to the Builder or borrower until its been completed. So big deal if its a new assignment change the signature date and be done.

10 cent Opinion: I find most are aware of...weather
The lender ...they are all different... can HOLD funds & typically 3 times the actual amount UNTIL 'the grass -landscaping' is completed.
ASK the lender HOW ...for THIER specific SOW ...underwriting guides- new construction.

 

[J Grant]

I also run into this exact issue. I've just checked subject to completion because as of the effective date, they are contractually obligated to install the landscaping, so this is technically a hypothetical condition from an appraisal perspective. I read through the selling guide B4-1.2-03, and don't see where it says appraisal can be as-is (when it isn't) (it seems like this is a USPAP issue more than a Fannie Mae issue). Granted this is a minor issue in the scope of the improvements, but does the "as-is" checkbox need to be checked to close the loan? I have occasionally made a note that they intend to do an escrow holdback to finish (and then I still check the subject to box). Why not appraise it as it really is, and let the people who close the loan do their job? Am I doing this wrong?

What if they didn't install the landscaping and it didn't close for some other reason, and everyone was mad. If you checked "as-is" and everyone's lawyer was going back saying "No it wasn't complete", who could potentially get their wrist slapped now?

If the parties amend the contract to accept house without landscaping done, They changed their contract to AS IS (they will close with the landscaping not finished ), with the $ to finish the landscaping post closing, and when it is done the escrow $ is released.

There is no risk to the appraiser, this is all Nutz because people do not understand how RE contracts work

 

[residentialguy]

Check Box forms. What a great idea ... Said no appraiser ever.

 

[Dublin ohio]

If the parties amend the contract to accept house without landscaping done

If the dog didn't stop to pee, he would've caught the rabbit

 

[J Grant]

If the dog didn't stop to pee, he would've caught the rabbit

Oh lol - if, when, they amend the contract, the point is they did amend the contract.

 

[J Grant]

I also run into this exact issue. I've just checked subject to completion because as of the effective date, they are contractually obligated to install the landscaping, so this is technically a hypothetical condition from an appraisal perspective. I read through the selling guide B4-1.2-03, and don't see where it says appraisal can be as-is (when it isn't) (it seems like this is a USPAP issue more than a Fannie Mae issue). Granted this is a minor issue in the scope of the improvements, but does the "as-is" checkbox need to be checked to close the loan? I have occasionally made a note that they intend to do an escrow holdback to finish (and then I still check the subject to box). Why not appraise it as it really is, and let the people who close the loan do their job? Am I doing this wrong?

What if they didn't install the landscaping and it didn't close for some other reason, and everyone was mad. If you checked "as-is" and everyone's lawyer was going back saying "No it wasn't complete", who could potentially get their wrist slapped now?

The house closes with no landscaping !! So the house not closing is not an issue ! It closes with the landscaping not done, and the buyer's attorney or the title company holds back $ for landscaping, for example $10,000 and the $ is released to the builder when the builder completes the landscaping.

If for some reason the builder never finishes the landscaping, they never get the $10,000, and buyer can then keep the $ and use it to pay another landscaper.

 

[TruJa]

If the parties amend the contract to accept house without landscaping done, They changed their contract to AS IS (they will close with the landscaping not finished ), with the $ to finish the landscaping post closing, and when it is done the escrow $ is released.

There is no risk to the appraiser, this is all Nutz because people do not understand how RE contracts work

OK maybe its "Nutz", but you are right... I don't understand, so please enlighten me. I'm not being antagonistic here, and from an appraisal perspective I'm seeing black and white (stamp out any fuzzy shades of grey!).

1) If they agreed to not install landscaping in the contract, then I check "as-is". (They have completed what they are contractually obligated to)
2) If they agreed to install landscaping in the contract, then I check "subject-to". (They have not completed what they are contractually obligated to)
3) If they change the contract after the effective date (to exclude the landscaping), that is fine and with some revision to multiple parts of the report it could be "as-is".... but it also changes the "as-is" value, because as of the effective date I am changing this report to value a home without landscaping, and the contract documents have changed.

Those seem like the viable options to me. I still feel like option 3 is a little shaky, and is basically doing a 1004d in the addendum. Am I messing this up (and if so how)?