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Oversight of Required Repairs?

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ZZGAMAZZ

Elite Member
Joined
Jul 23, 2007
Professional Status
Certified Residential Appraiser
State
California
Scenario is a FHA report conditioned because of pre-1978 chipped & peeling paint, and a broken interior window-bar safety release mechanism.

There are specific remedies and procedures to remedy these issues, and the MB wants to know specifically how his client should respond.

Should the appraiser serve as a repair consultant of sorts to help avoid slapstick work that won't pass the subsequent inspection; or does this pose liability beyond the SOW?

I imagine that some might say it's a "business decision" rather than an "appraisal decision," but several threads have indicated that the appraiser shouldn't communicate with anybody but the D.E.U.

This might appear to be a frivolous question but it's one that arises on a daily basis. Thanks.
 
When calling for repairs on the actual appraisal report, just make it very clear what you see, and for repairs that you will be signing off on, you should also make it clear what you expect to be done to clear the condition. Supporting photos also help of the current problems. For example, peeling paint, explain each and every area that needs re-painted, or else when you get back out there, some areas will not be done. 99% of the time they will do the bare minimum, so make sure your description of what is expect goes at least that far. For inspections (roof, termite, etc.), you can not explain what is expected, because you as the appraiser will not be signing off on those. Thoroughly explaining on the initial report saves many of these phone calls, and third and fourth trips out to the subject.
 
Subject to for the chipping paint pre-1978.

I would stay away from giving any advice on the other issue. You may leave yourself open to liable.
 
If you the appraiser will be conducting the FHA final inspection to clear any repairs that you the appraiser called for, how would it increase your liability to explain to them what you expect to see when you conduct the final to clear the issue ??? Seems to me being clear of what is expected reduces your liability, unless your expectations do not comply with FHA/HUD guidelines.

Borrowers, and agents are excellent at playing dumb when it comes to this stuff, explain in detail on the original report to avoid playing games with them.
 
It is our job as an appraiser to report what does not meet HUD/FHA min. requirements. It is not our job as an appraiser to dictate how it should be repaired and what materials are used. If you want to take on that liability, then so do. I am only going to report the required repairs and go out and see if they have been repaired.
 
It is our job as an appraiser to report what does not meet HUD/FHA min. requirements. It is not our job as an appraiser to dictate how it should be repaired and what materials are used. If you want to take on that liability, then so do. I am only going to report the required repairs and go out and see if they have been repaired.

? Who said that ?

When we sign off on a repair, we take the liability, period. Just common sense to explain what we expect to see when we return to the property. It saves game playing, pestering phone calls, and borrowers/agents playing dumb.

You don't have to tell them what grade of sandpaper to use, brand of paint, etc., just explain where you see peeling paint on the house and what areas need to be repainted for you to sign off. How many have received phone calls asking in detail each inch of the house that needs painted or even worse returns to the home to find not all of the areas painted. With the safety bar example, explain which ones do not meet HUD code and what has to be done to bring it into compliance. It is not rocket surgery, just explain what you see and what the expectations are to clear the issue. m2:

When dealing with FHA/HUD repairs, it is best to be firm from the start, if they detect any wavering they will usually take the easy way out or try to play games. stop the nonsense before it starts...
 
It's easy to tell if paint repairs are complete. It's a good idea to include a requirement for pre-scraping or you might come back to find a lumpy mess that is subject to re-peeling at any moment. Afterwards, if there is a smooth, sealed painted surface, you simply report that the repair is complete.

Just don't stick your neck out for the quality of the work. You did not do the repair so don't say anything you can't prove. If the borrower tells you he had a licenced painter scrape, prime, and paint, you really don't know that personally. Just say the repair is complete and take a picture.

For the window safety release, if the release works when you come back, then you can report that the repair is complete. Such a thing does not have to be pretty, it only has to work.

TJ is right, you need to take some responsibility for truly minor repairs. You just don't have to be the one everyone points at if the repairs do not hold up.

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There are always situations where it's a little hard to decide which items you are competent to call as a "subjct to repair", and which ones need an expert inspection. It may be different from appraiser to appraiser.

In general, you should keep your involvment to the level of what appraisers should be expected to know in their role as an appraiser. If something is beyond that level of expertise, call for an expert inspection.

Most importantly, keep your list of items strictly separate between what you will declare complete and what you are leaving up to other experts.
 
It's easy to tell if paint repairs are complete. It's a good idea to include a requirement for pre-scraping or you might come back to find a lumpy mess that is subject to re-peeling at any moment. Afterwards, if there is a smooth, sealed painted surface, you simply report that the repair is complete.

Just don't stick your neck out for the quality of the work. You did not do the repair so don't say anything you can't prove. If the borrower tells you he had a licenced painter scrape, prime, and paint, you really don't know that personally. Just say the repair is complete and take a picture.
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What we used to do -back when I sold Real Estate- was to call for any repairs the Seller had to make, to be made this way
"All the above noted repairs are to be made in a Good and Workmanlike manner"
- this actually has a legal meaning (SEE BELOW), so lumpy paint, and paint over an un-sanded drywall patch automatically become unacceptable.

FROM ONE COURT:
"We define good and workmanlike as that quality of work performed by one who has the knowledge, training or experience necessary for the successful practice of a trade or occupation and performed in a manner generally considered proficient by those capable of judging such work."

Since I believe I can tell lumpy paint from smooth, and a broken window from one with unbroken glass - puttied in, I tend to report on good repairs this way:
"Repair appears to have been made in a good and workmanlike manner."

Lucky for me, I haven't seen lousy repairs, but when I do, I'll have some backup for saying it was not done correctly.

Yeah... we're not building inspectors, but we can tell Night from Day
 
Good points Marcia and Riick. Even though FHA does not require repair photos, I take them and submit with the report anyway, just so it is documented what was signed off on or rejected.

The gray area with FHA repairs one usually runs into is when you can tell the repair work is just a "patch job" and not a true fix, that is where one's judgement comes into play.

The OP stated that they run into these type of questions almost daily, which is why my above posts suggested going into more detail regarding repair issues on the original report. If explained thoroughly on the report, phone calls from people other than the DEU will then be kept to a minimum (if they still call now you can tell them to just RTFR). Explaining completely (and including before and after photos) does not enhance ones liability and in fact reduces it.
 
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I think I'll go ahead and generate a Quality-&-Condition of the Property template designed for FHA appraisal reports, somewhat akin to a post-VC worksheet that can be incorporated into all of the residential appraisal software forms.

Mine would be a strictly commissioned product for, say, $1 per user per report, nationwide.

If you guys would be so kind as to do the work-up and e-mail the result of your labours, I'll get the trademark and embed my 'zz' into the document. Your assistance will be rewarded with a discounted fee of $0.95 per report and I'm sure you appreciate my largess.

I'm wondering: Would a product like this need to be pre-approved by FNMAE and/or HUD? There is so much confusion and controversy--not just among newbees like me--that it seems logical that a standardized approach would help the underwriting process as well as the appraisal process.

I presume that the practitioners who knock "the form" won't support the idea of adopting a new template, but from a certain perspective and in specific situations a form approach results in a standardized application and a product that's easier to interpet and to facilitate.
 
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