not permitted but does it add value?

[Mike Boyd]

Good response, J Grant. I agree 100%

 

[Riick]

USPAP: Confidentiality (ETHICS RULE)

An appraiser must protect the confidential nature of the appraiser-client relationship.

An appraiser must act in good faith with regard to the legitimate interests of the client in the use of confidential information and in the communication of assignment results.

An appraiser must be aware of, and comply with, all confidentiality and privacy laws and regulations applicable in an assignment.*

==========================================

Gramm Leach Bliley (GLB) LINK

Are we acting as the "affilliate" of a financial institution??

Sec. 6802. Obligations with respect to disclosures of personal information
(a) Notice requirements
Except as otherwise provided in this subchapter, a financial institution may not, directly or through any affiliate, disclose to a nonaffiliated third party any nonpublic personal information, unless such financial institution provides or has provided to the consumer a notice that complies with section 6803 of this title.

(4) Nonpublic personal information

(A) The term ''nonpublic personal information'' means personally identifiable financial information -

(i) provided by a consumer to a financial institution;
(ii) resulting from any transaction with the consumer or any service performed for the consumer; or
(iii) otherwise obtained by the financial institution.


​

(11) Customer relationship
The term ''time of establishing a customer relationship'' shall be defined by the regulations prescribed under section 6804 of this title, and shall, in the case of a financial institution engaged in extending credit directly to consumers to finance purchases of goods or services, mean the time of establishing the credit relationship with the consumer.

 

[LordofTexas]

one problem is the addition looks really really non-permitted. it has a half bath and the toliet sits at the top of three stairs. It looks like a throne. i still can't figure out why that was done. If any one wants to see the photo let me know and I will send it to you. I might treat this as an unpermitted enclosed patio since the walls appear to be wood nailed to the studs and no insulation, etc. ugh. thanks for your help

Renee, it's clear the half bath was added after the fact due to the "throne" situation. The large drain plumbing is housed inside this boxed throne. Most likely, the floor is slab and they didn't want to crack that to get the plumbing out.

Regarding value, I always tell the borrower; "Sure, I can give it value; but I'll have to require permits for it." This usually gets the response of, "No, just don't give it value." Either way, I always mention it in the report, as you should and do not value it.

I also then tell the borrower; "At the time of resale, you clearly may get a greater value for your home due to this addition. However, most appraisers can not legally give it value if it is not permitted. Also, you should take steps to remedy the situation because it more than likely will be required to be fixed by some entity down the road BEFORE you can sell it.

Lordy

 

[ZZGAMAZZ]

I understand now...

the "legitimate interest of the client" (not to be confused with the personal interests of the borrower) as it pertains to an illegal use or a non-permitted area would require an appraiser to notify the jurisdictional authority of issues contrary to the general plan, especially if real property improvements are public information.

 

[CCAAMO]

WARNING

Calling the City and effectively giving them a heads-up on a violation
can be a VERY sticky situation.

I would hesitate -long and hard- about giving them an address;
if they then want it torn down, or just hassle the owner as a result of the
phone call, guess who is liable to get a lawsuit aimed at them?

Give me a break! I never had any problems or knew of any appraiser who was ever sued for verifying or checking permits with the city. To do so requires providing the address of the property but it does not mean you have to tell them what your looking for.