Pool not completed yet..

[Mark K]

a Hypothetical that it's being completed.

I think an EA would be appropriate. HC would assume the pool is already completed.

 

[J Grant]

A hypothetical condition in appraisal is an appraiser's assumption about a property that is contrary to what is known to be true, but is used for the purpose of analysis or to fulfill legal requirements. It's a condition that doesn't actually exist on the effective date of the appraisal but is assumed to exist for the valuation process.

 

[Dublin ohio]

I think an EA would be appropriate. HC would assume the pool is already completed.

I think you have it backwards

 

[Surf Cat]

I think an EA would be appropriate. HC would assume the pool is already completed.

That's the whole point of checking subject to.... it's on the basis of a hypothetical condition that the improvements have been completed.

There's no extra, long winded commentary needed. The only extra commentary I would throw in the report is that the empty pool is a health and safety hazard..... just to cover myself if some dummy steps into the empty pool so I don't get sued.

Glenn is most likely correct in that the borrower needed the extra cash to finish the pool.

When the pool is complete, the op goes back out for a 1004D.

 

[Mark K]

SO YES YOU COUNT IT as a new pool with a Hypothetical that it's being completed.

When I read the above, I read that it is 'being' completed, as 'in process'. Not the HC that the completed pool already exists.
IMO, that requires an EA that the pool that's in-process will be completed. If others want to use both (I'm not sure why), go for it.

"The appraised value is $500K, based on the EA that the pool currently under construction will be completed per plans and specs."

 

[Fernando]

That's the whole point of checking subject to.... it's on the basis of a hypothetical condition that the improvements have been completed.

There's no extra, long winded commentary needed. The only extra commentary I would throw in the report is that the empty pool is a health and safety hazard..... just to cover myself if some dummy steps into the empty pool so I don't get sued.

Glenn is most likely correct in that the borrower needed the extra cash to finish the pool.

When the pool is complete, the op goes back out for a 1004D.

Why don't owners complete the pool and then get the loan?
By having incomplete pool, many uncertainties especially when it will be completed.
If too long, an updated appraisal may be required.

 

[Surf Cat]

Why don't owners complete the pool and then get the loan?

Because appraiser king, they need the money to finish....

 

[Fernando]

Because appraiser king, they need the money to finish....

King appraiser would tell owners to remodel first and complete it and then refinance.
I should be a loan agent.....oh, I was in the past.

 

[J Grant]

I desdribe and take a photo of the half finished pool and if client wants it subject to completion, then the eff value is as if the pool were complete on the eff date. Taht is the whole point of an HC made subject to completion ( we might have to go back later for the 1004 D final inspect)

In the past, if asked for an as is value on a half-finished pool it got some minor value for some o the work being done and permits pulled - it costs less to finish a half-built pool then start from scratch. However, there is a penalty for marketability as most buyers want a finished pool so there might be no added value in some cases -each appraisal is different.

 

[Tom D]

2 weeks left to complete the pool? You will have it done before the lender figures it out. Now, if you need the money to finish it, then tell the pool people, you paid when finished and i get da money. What are they gonna do, take it out?

Some of you people here don't understand 2 week to finish, and the time it takes after the appraisal to close any loan will be more than 2 weeks.

And the borrower did/didn't mention this pool to the loan officer.