Public Sewer Connection: Feasibility

[Zoe]

It's not the appraiser's responsibility to determine the cost to connect and if it is feasible. That is the Lender's responsibility. Only report if it is available. The VA will not require connection unless it is required by a governing authority. The FHA should adopt that rule.

I agree...........

If code says the property cannot sell if public sewer is right on the street serving the subject, then the appraiser has a problem without the owner connecting before they can sell the property.

Then the lender or FHA, VA, and/or lender have a problem if they get the property back.

I have been through this in a jurisdiction. They were like no they have to connect before it can sell.

They even went to where they could connect at. Yeah...........

Don't fight city hall.

 

[Tom4value]

Appraisers are not required to estimate the cost to connect to a public sewer system.

ii. Required Analysis and Reporting

The Appraiser must note the deficiency of MPR or MPS and notify the Mortgagee if the
Property is not served by an off-site sewer system and any living unit is not provided with
an Onsite Sewage Disposal System adequate to dispose of all domestic wastes in a
manner that will not create a nuisance, or in any way endanger the public health.
The Appraiser must visually observe the Onsite Sewage Disposal System and its
surrounding area. The Appraiser must require an inspection to ensure that the system is in
proper working order if there are readily observable signs of system failure. The
Appraiser must report on the availability of public sewer to the site.
The Appraiser must note the deficiency of MPR or MPS and notify the Mortgagee if the
Appraiser has evidence that the Onsite Sewage Disposal System is not sufficient.

* Excerpted from page 848 of HUD Handbook 4000.1, Revised 05/20/2024

“Appraiser must report the availability of public sewer to the site”.

There you go. Government is not the best on being clear but how can you determine, “availability” if you don’t do what I posted?

 

[Zoe]

The appraiser could do a disclaimer, but in my case, the owner told me it was on septic. They were an investor. I know the jurisdiction very well.

They sold it, but they had to connect to public sewer. I never heard from the investor (owner) again.

They thought I was lying to them. I said I have no reason to lie to you. This is a contact I have with City Hall.

 

[Tom4value]

Appraisers are not required to estimate the cost to connect to a public sewer system.

ii. Required Analysis and Reporting

The Appraiser must note the deficiency of MPR or MPS and notify the Mortgagee if the
Property is not served by an off-site sewer system and any living unit is not provided with
an Onsite Sewage Disposal System adequate to dispose of all domestic wastes in a
manner that will not create a nuisance, or in any way endanger the public health.
The Appraiser must visually observe the Onsite Sewage Disposal System and its
surrounding area. The Appraiser must require an inspection to ensure that the system is in
proper working order if there are readily observable signs of system failure. The
Appraiser must report on the availability of public sewer to the site.
The Appraiser must note the deficiency of MPR or MPS and notify the Mortgagee if the
Appraiser has evidence that the Onsite Sewage Disposal System is not sufficient.

* Excerpted from page 848 of HUD Handbook 4000.1, Revised 05/20/2024

“Appraiser must report the availability of public sewer to the site”.

There you go. Government is not the best on being clear but how can you determine, “availability” if you don’t do what I posted

Please provide your source to support your post.

Called FHA.

 

[Zoe]

I told the owner and I know it got to buyer through the chain. This is man's name and I posted it in appraisal on my "subject to" conditions".

I knew I wanted buyer and seller knowing on front end. Lender, VA/FHA etc.

Trust me Lender, VA or FHA will not challenge a local jurisdiction rules.

This is govt official you can discuss this with seller. This is his name and phone number and address. Put it all in appraisal report.

 

[Zoe]

The govt official already told to tell whoever to call him. Catch my drift?

 

[Zoe]

If you talk to local officials in a jurisdiction, they can tell you most of the time if public sewer is readily available on a public street serving the subject property.

They can also tell you based on their rules if the property has to connect or not if they are on septic at the present.

I think I have told this story before. I was in place worship appraisals for a long time.

So I take assignment on what I consider a very large place of worship.

So, I go through my routine and find out public sewer stops a substantial way from the subject vacant site. Construction is already under way.

So I suddenly call the lender and say we have a problem here based on my conversations with officials.



Everybody assumed public sewer was readily available including my client.

It costs tens of thousands to get public sewer extended to the subject site. I think the jurisdiction helped the place of worship but I did my job and people were happy and thanking me.

 

[Zoe]

I didn't confirm to you that this was proposed construction but place of worship had already spent tons of money out of pocket.

Banker told me preacher was very thankful to me. Banker was too.

 

[Zoe]

If public sewer does not front the subject site? Your pretty much home free. Not always because many times public sewer has easements close by and might still make you connect depending on distance. They want you to connect to closest connection if public sewer is available on public street serving the subject or street close by. They have easements on utilities.

The jurisdiction pays for the public road and the sewer system. They want you go connect to public sewer.

 

[Zoe]

When a jurisdiction is serving like a huge place of worship on public sewer system, the size of the pipe they have to lay is way bigger and may need a pump in the pipe also depending on the system. They were happy on my appraisal. No FHA, VA involved. Direct lender.

Code enforcement knows all of that in populated area where they provide. They say okay that one will need this size service pipe plus maybe a pump or two. They know.