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Pending litigation?

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MARKETVALUENOW

Thread Starter
Sophomore Member
Joined
Dec 14, 2007
Professional Status
Licensed Appraiser
State
Michigan
I was asked by a lender to state that there is no pending litigation for a site condo. Is there a way for me to verify this info?
 

Brian Weaver

Senior Member
Joined
Apr 16, 2005
Professional Status
Gvmt Agency, FNMA, HUD, VA etc.
State
Illinois
The lender should be doing this...you know, the person getting commission for filling out papers; not the appraiser. This is NOT an appraisal task.

What does item 1 say in the Limiting Conditions?

This is SO their problem and NOT yours.

The L.O. and underwriting should be reviewing the decs, the budget, and researching any pending litigation through legal.
Do you have free access to Lexis/Nexis? I doubt it.

They know better than that.

Don't assume any responsibility for this. You don't want them coming back later with..."but the appraiser said..."

I'm sure that your E&O provider would agree.
 

Ariba

Senior Member
Joined
Feb 8, 2004
Professional Status
Certified Residential Appraiser
State
Colorado
Ditto to above post. Also, if this is a purchase they have Title Insurance and it is their responsibilty to search the records for any litigation.

Ask the managing agent of the HOA.

I would not take his/her word it is not your job. However, if you are inclined to take his word I would ask for the minutes of their annual meeting and at least 3 months of their monthly news letter to the homeowners.

Bottom line, I would personally not do it.
 
Last edited:

Walter Kirk

Senior Member
Joined
Jun 24, 2003
Professional Status
Licensed Appraiser
State
New Jersey
The only reason that an appraiser should comment on pending litigation is if it impacts market value. The only way that pending litigation can impact market value is if its public knowledge. Tell the lender to be more specific.
 

Couch Potato

Elite Member
Joined
Mar 15, 2004
Professional Status
Certified Residential Appraiser
State
North Carolina
Assuming you do not know of any pending litigation, you could say you did not become aware of any pending litigation. You would likely also want to comment you did not research pending litigation. Those are the kind of things you might offer the moron asking for the comment.

Under no circumstances should you say, "there is no pending litigation." In making such a statement you would be saying you know the future actions of everyone in the world.
 

Carnivore

Elite Member
Supporting Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
North Carolina
The lender should be doing this...

The L.O. and underwriting should be reviewing the decs, the budget, and researching any pending litigation through legal.
Do you have free access to Lexis/Nexis? I doubt it.

Once again the Quick, Lean and Cheap Crowd wants something for free. They wont ask the clsoing attorney because the charge would be $1,000+ for this Service.

Speaking of Service, where is the usual "We are a Service Business" Crowd?

Thanks Brian, for setting the leadership example for the majority of the other Appraisal boards to follow!

I can get a Tar-Heel "Draft Brian" Fund going at the drop of a hat!! :)
 

Chris Colston

Elite Member
Joined
Jul 24, 2003
Professional Status
Certified Residential Appraiser
State
Florida
Speaking of Service, where is the usual "We are a Service Business" Crowd?
Enjoying Christmas with family and friends :clapping: :new_xmas:, why are you here?

Anyway, to get back on topic...if the client is asking about any pending litigation perhaps the client actually knows something you don't and might need to. We have several complexes, in this area, that have gone into receivership (state takes over the management). A situation like that can definitely affect marketability.
 
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