purchase contract revision after appraisal is completed

[The Bob]

This is a good client, and perhaps, under today's working environment, there is a better answer than "pound sand" or "more money, please."
I was hoping for a more diplomatic response.

Here's what I have done in the past. I write a LETTER, not an addendum to the original appraisal, and state something like this.....

"Appraisal for 123 Easy St was completed on xx/xx/xxxx. After the effective date, the client has supplied me with a revised contract dated xx/xx/xxxx, which is after the effective of the appraisal. The revised contract states bla bla bla. I will retain a copy of the revised contract in my work file. The revised contract has no bearing on the appraisal and was given no consideration since it is dated after the effective date".

Believe it or not, but this shuts 'em up. Never had one come back.

 

[Webbed Feet]

Hello all-
I would appreciate some advice. I completed an appraisal 4/25/08 for a purchase transaction. The contract has since been revised (5/06/06) in that the seller is now paying concessions. The Client is asking that I revise the appraisal to report these concessions. However, since the revision to the contract was made after the effective date of the appraisal, what is the best way to approach this issue? (No change has been made to the purchase price.)

The client wants me to change the contract information on page 1 of the URAR; I am skeptical about this since the effective date of the appraisal is prior to the contract revision.

Thanks!

Sigh, the forum gets this one over and over. Here is my view. The parties to the transaction altering their contract terms after the fact of the appraisal is NOT justification for me to be altering that appraisal report from the truth as of the effective date.

I would offer a letter addendum (meaning Mr. Bartley's "Letter" as I am not altering the appraisal report) to state they sent me a copy of the new contract, I looked at it, and sure enough! the parties have entered into a new contract agreement based on what the client sent me. That is it. No alteration of the prior appraisal report. And this should be adequate. Rather pointless, but adequate.

I am not fond of being asked to sanitize appraisal reports. No "analysis" of any and all possible future contractual changes between the parties was agreed to as part of the engagement contract or SOW.

Webbed.

 

[nb23yrs]

Advice was received and applied. Thank you.

 

[Mike Kennedy]

I have asked that question specifically to the ASB, the response was that it is technically a new assignment. How you decide to handle billing for it vs not billing is up to you.

Hey Bill, you don't happen to have that response in writing still laying round?

 

[nb23yrs]

I just received an e-mail from a very well known USPAP instructor, whom I believe also serves on the ASB, that THIS IS A NEW ASSIGNMENT. At a minimum, an appraisal update must be issued. Sorry for shouting, but I am relieved to get a difinitive answer!

 

[Webbed Feet]

I just received an e-mail from a very well known USPAP instructor, whom I believe also serves on the ASB, that THIS IS A NEW ASSIGNMENT. At a minimum, an appraisal update must be issued. Sorry for shouting, but I am relieved to get a difinitive answer!

Based on your client's original request, that of altering the prior appraisal report, I agree that is a new assignment request due to the change in the intended use. The intended use changed because the risk assessement of the sale based on the prior sale terms is no longer valid. They are assessing a new sale that has to require completely replacing the entire contract analysis section for starters.

But I will still say a letter stating a fact is not appraisal activity as long as we don't tie it to development or start analyzing it. About all it is equal to is an answer back to an email to confirm the email was received.

"Hi, got what appears to be a new contract you sent to my fax or through my email. Yes indeed, it is one lovely contract! Really nice creative use of fonts there! I assume the signatures on it are actually the buyer and seller involved, but I cannot confirm, deny, or verify they are as I am not a signature expert and do not have confirmed copies of their signatures provided with sworn witnesses or notorized authority showing anywhere.

Ok, that was fun. Hope you enjoyed this letter as much as I did.

Appraiser."

Like I said, sorta pointless. But somehow people seem so happy to use meaningless drivel as if it means something. Must be because 40% to 75% of the appraisal reports they get have similar verbaige in them all the time with little to no content anyway.

Webbed.

 

[Mike Kennedy]

I just received an e-mail from a very well known USPAP instructor, whom I believe also serves on the ASB, that THIS IS A NEW ASSIGNMENT. At a minimum, an appraisal update must be issued. Sorry for shouting, but I am relieved to get a difinitive answer!

Kindly ask that person to send you a link or copy of the DEFINITIVE requirement......thanks. If there ISN'T one.......

an EMERGENCY Q&A citing one should be published Immediately ......and sent to EVERY CEO of EVERY AMC AND CHIEF APPRAISER OF EVERY MAJOR BANK LENDER.