NRCC Question S.O.S.

[Brandi Hudson]

This is something I JUST started doing and was NEVER taught.

Recently, I appraised a property that had a previous appraisal to go along with it. I noticed in the "concessions" box , the previous appraiser took off for the sellers closing cost being credited, (per MLS listing).

I immedialty FREAKED out,:Eyecrazy: and started checking all my comps MLS listings to see if the agent typed in any closing cost being credited. Since then, I have been noting these costs and making adjustments. HOPING I have not been a bad appraiser the last 6 years!!!

Question is this: Realtors are liars, and dont always type in accurate information on thier listings. Should I use this NRCC cost as an adjustment if I see it ?

HELP !!

 

[Christine Marie]

Brandi, in my market closing cost or at least a certain percentage are typical and are not considered concessions, but even when i encounter them on the MLS sheet, i always try to verify the sourcet, usually i contact the selling agent and find it the lender and go from there, ......

you're right, some agents mis-present...

 

[T.E. Faravelli]

It depends on what is considered to be typical and reasonable for that particular segment of the market. 3%, 4%, 5% may apply as normal NRCC. FNMA and FHLMC does not accept positive adjustments for financing just negative one's. Supplemental standards issued by a quasi-private company.

Kookie!!

 

[Pamela Crowley (Florida)]

http://appraisersforum.com/search.php?searchid=298678

The link is to threads with the word "Concessions". You can skip the Housing Bubble thread for what you want to know.

 

[Richard Carlsen]

Realtors are liars,

Rather a broad statement don't you think Brandi. Do you mean real estate brokers or sales people by chance?

Based on this sort of generalization and logic, it is therefore fair to conclude that since some appraisers only work to "hit the number", all appraisers are dishonest *****s to the MB's and could care less about doing a good job. And therefore based on this logical assumption about appraisers, why are you worried about a little thing like seller concessions. We know that appraisers only want to hit the numbers so don't let a little thing like a sellers concession worry your head. Just hit the number. You are an appraiser after all.

Regards

Richard Carlsen
Appraiser/REALTOR

 

[Otis Key]

I immedialty FREAKED out,:Eyecrazy: and started checking all my comps MLS listings to see if the agent typed in any closing cost being credited. Since then, I have been noting these costs and making adjustments. HOPING I have not been a bad appraiser the last 6 years!!!

Question is this: Realtors are liars, and dont always type in accurate information on thier listings. Should I use this NRCC cost as an adjustment if I see it ?

Uhhhhhhh - you mean to tell us that you hadn't been checking and performing a verification on your sales before? And I don't mean just by reading the MLS printout.

 

[Lee Lansford]

"...or sales concessions* granted by anyone..."

"...or sales concessions* granted by anyone associated with the sale."

The quote is taken from the defintion of market value as found in current Fannie Mae appraisal report forms.

I don't know where this thread may be headed, but I just know that someone is going to post something along the lines of "well, in my market, seller concessions are 'typical' and, thus, I don't adjust for concessions."

READ the section that accompanies the definition of market value and which is referenced by the asterisk. The wording is quite specific in that concessions paid to the buyer by anyone associated with the sale is a concession unless the "seller pays these costs in VIRTUALLY ALL (fyi: I added the emphasis) sales transactions."

Preceeding, "No adjustments are necessary for those costs which are normally paid by sellers as a result of tradition or law in a market area".

Thus, just because seller concessions are "common" or there are "a whole lot of concessions" or "seller concessions are frequent" does NOT rise to the level of VIRTUALLY ALL and are a result of TRADITION OR LAW.

By way of example, in my market area--in "virtually all" transactions where a current plat of survey is required, by "tradition" the seller pays for and provides the buyer with the plat of survey. Thus, this is not a seller concession.

I do see neighborhoods where seller concessions are very common (i.e., probably found in the majority of transactions), yet this does not rise to the level of "virtually all and are a result of tradition or law."

Many appraisers evidently do not understand this topic and many seller concessions go unanalyzed.

 

[Carnivore]

Lee,

Some appraisers must be looking at concessions. Other wise, why would builder/developers go to such great pains in hiding them?

 

[Lee Lansford]

Andrew, I suspect that you are right...some appraisers are considering seller concessions. "Some", but not all.
Many builders really do understand the implication of their concessions.

I raise the point because it is evident that many appraisers do not understand the topic.

Lee