Occupancy Determination (CHECK BOX)

[incognito]

What if you find out that the tenants are only there 2 months, and the owner is there 10 months, AND the CCR's and Docs only allow minimum 3 month rentals! (Most do in my area, and most zoning requires a minimum of 3 month rentals). Do we now have to check the "Illegal, non-conforming use" box as well?

 

[residentialguy]

I agree with Webbed that checking one thing, than saying another in an addendum is misleading.

The whole check box thing reminds me of when I was late paying my Sears card. When I went to pay it online, they had a whole list of check boxes...
I was sick
I lost my job
I am in financial peril
etc..
then
I will be okay in 1-3 months
3-6 months
6-12 months
etc

m2:

not one of them was the answer and I had to check one to pay my bill. The addendum is not misleading...the check box is.



.

 

[BRCJR]

So... what do you do regarding occupancy checkbox on the 1004?

The only thing that would change is the checkbox, the explanation is is the same in my addendum. And it doesn't affect value....which do you check off BRCJR?

Owner Occupied and explain.

 

[AnonApprsr]

Where were you before I shipped it BRC?

 

[Ann O'Rourke]

It is the lender's responsibility. The value is not affected. Of course, the borrower wants owner checked so they can get a better rate.

An appraiser has no way to get the info lenders have, such as a signed document saying it is owner occupied, mail being delivered, etc.

We are not the occupancy police.

Call the lender. Make sure you have good notes on what they said.

Another question. I do mostly estate and trust work. Should I check vacant or owner occupied on the day of death? A topic in my office.

 

[CANative]

Owner occupied because until at some point he was alive on the date of death.

 

[Lobo Fan]

I lost a pretty good client over this issue. I did a 1004 on a house. All the tax bills went to an out of state address and the contact number was out of state. Was told it was occupied by a house guest. I got there and there was no evidence that anyone but the "guest" lived there. No clothes, no furniture, nada. Plus the "guest" had been there for several months, creating a tenancy whether he paid rent or not. Anyone that stays over 30 days is a tenant, regardless of any payment agreement.

Anyway, I was labeled as non-cooperative and the orders went from 2-3 per week down to zero.

 

[Michigan CG]

............All lenders will be familiar with this guide as it is pretty much their bible.........

I have read through the first four pages of this and found Brother Folken's post a little humorous. I have found most lenders to be somewhat clueless and Brother Folken is giving many in the lending world too much credit.

(the Brother thing is copied from Webbed........I guess we are all Catholic now )

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

In my reading of the first four pages wouldn't this all be solved by four paragraphs of narrative reporting and let the lender make the decision?

Call me silly, but I wouldn't check any box and would thoroughly explain everything. Appraisers aren't underwriters and we don't make loan decisions. That is the UW decision (educated or not).

 

[AnonApprsr]

I did explain everything, in a beautiful paragraph (Pulitzer prize stuff actually) in the addendum.

 

[residentialguy]

I did explain everything, in a beautiful paragraph (Pulitzer prize stuff actually) in the addendum.

And I think you have a good defense. So does the appraiser that sees occupancy as homeowner occupied because it primarily is. There is not a wrong answer as long as you explained your rationale.

After deliberation, I think your decision to uphold your initial report was the best decision. You're on shaky ground when you "change your mind" after the client ask you to or you do it for the client's sake. I hereby officially take back any statements that suggested you change your report.

Either way, you need to explain. However, I really like Mich's idea of not checking a box and explaining the situation and dumping it into the UW's lap.
I change my vote to no box check (maybe asterisks only) and explain.


Like I said earlier:

The addendum is not misleading...the check box is.



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