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Purpose Vs. Intended Use

2070 assigned AFTER 1004....

  • Can accept assignment, if performed competently.

    Votes: 0 0.0%
  • Appraiser in violation of ethics to accept 2nd assignment.

    Votes: 0 0.0%
  • Send this question to the ASB for Q&A?!?!?

    Votes: 0 0.0%

  • Total voters
    0
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Farm Gal

Elite Member
Joined
Jan 14, 2002
Professional Status
Licensed Appraiser
State
Nebraska
An interesting point has been raised in another thread started by Jerry Bland
PLEASE, DON'T go read it til you vote cause otherwise I don't think you can get BACK here!
Comment where ever you want, but I'd like to see the results of this poll!
and don't just wimp out on it by doing that null vote thing :rolleyes:

I perceive the issue to be determining the purpose of the assignment as opposed to the intended use
for mutual client/appraiser determination of proper scope for an assignment.

~~~~~
Appraiser competently performs an appraisal.
Bank is not happy about the results of the assignment.
Bank THEN requests a 2070.
Appraiser fulfills request for marketibility report (no appraised value).
Property is appropriately deemed to be in marketable condition.

Again, the appraiser was NOT asked in the second assignment to form an opinion of value,
just provide the format of report requested.

Bank is an educated user.
Even were the appraiser fully apprised of the specifics of the potential loan terms for the second assingment...

AND (importantly) given that loan terms are subject to final determination by the intended user:
IS the appraiser guilty of breaching ethical constraints in providing the bank with the second report?

~~~~~~~~~~

I submit that the answer is NO!
(Ducking from the anticipated barrage of abuse).

While a grey area, in terms of the order of things... in this instance, I submit that as appraisers we cannot and should not :angry: be held accountable for the actions of our clients if we have personally acted ethically in preparing our reports. Any potential resultant malfeaseance is entirely on the part of the user of the report.

BECAUSE WE CANNOT FULLY KNOW WHAT THE INTENDED USE OF THAT SECOND REPORT IS GOING TO BE!Bank might be intending to use their own money to cover any gap?!?! Instead of that which WE insure <_< !
do ya think? <_<

Poll located above: 1,2, or 3

I'd pick the last door, just to see!
Knowin' there is at least one appraiser whos gonna bark me up a tree :p
~~~~~~~~~~
Seriously, what IS our responsibility in a case like this?

oh yeah:

Jerry's post HERE
 

Chris Colston

Elite Member
Joined
Jul 24, 2003
Professional Status
Certified Residential Appraiser
State
Florida
Originally posted by Lee Ann@Aug 28 2003, 08:59 PM

Appraiser competently performs an appraisal. Bank is not happy about the results of the assignment.
Bank THEN requests a 2070. Appraiser fulfills request for marketibility report (no appraised value).
Property is appropriately deemed to be in marketable condition.

More than likely the loan will be portfolioed and never see the light of the secondary market. The 2070 simply reports the subject is marketable within a certain set of conditions. So long as the appraiser keeps all of the work file data together I see nothing wrong in following the client's new instruction. B)
 

larryhaskell

Senior Member
Joined
Apr 23, 2002
Professional Status
Certified General Appraiser
State
Nevada
Lee Ann:

I wish you had given a 4th choice of simply not accepting the 2nd assignment. I picked choice No. 2 not because I necessarily believe it would be a violation but, based on the limited info in the other thread, my comfort level goes way down. My view on these somewhat sticky issues is if this problem ever found its way into a court room how comfortable would I feel defending my position. I view our primary responsibility in this process as to protect our client's interest and preserve the public's trust. My gut feeling is that the LO is just trying to make the deal work and isn't too worried about the deal going bad someday due to great credit, big down, etc. It's likely the lenders risk isn't that great. My concern is directed more at the borrower. Even if the borrower has all the facts and knows that they are possibly over paying for the property wouldn't deter them from coming after the appraiser if their life went sour. Sometimes this type of person will ultimately look for someone else to blame for their mistake. Even if the case goes to court and the appraiser prevails, it costs him/her time and money. Secondly, I don't have the greatest faith in E & O companies fighting this kind of a case if it's cheaper to just roll over and pay the $$$$$. My tendency is to just back off from something when I smell a rat. It seems lately that I've been smelling lots of rats. :angry:
 

jtrotta

Senior Member
Joined
Jan 16, 2002
I'm going to 2nd Larry's vote fer president and for the basis he invoked B)

why did you leave out the other choice ;) merely coincidence :question: :mrgreen:


:ph34r:
 

Farm Gal

Elite Member
Joined
Jan 14, 2002
Professional Status
Licensed Appraiser
State
Nebraska
If coincidence equates to being too stupid to think it all out in advance: then yes :p

I sort of figured it was a hypothetical so it was yes no or maybe answer options.

There is a reason pollsters get paid big bucks:
me, I am underpaid and overtired for this application.
ta! beddy-bye time
:asleep:
 

Pat Butler

Senior Member
Joined
Jan 17, 2002
Professional Status
Certified Residential Appraiser
State
Illinois
It's probably legal but could present problems in the future. I personally wouldn't do it and would recommend that they use the 1004 which, if completed properly, could provide them all the marketability and condition data they would ever need.
 

Wally Jones

Senior Member
Joined
Jan 23, 2002
Professional Status
Certified Residential Appraiser
State
Florida
I voted that it would be an ethics violation because it seemed like the best answer for the situation.

I have not read the other post, yet, so I'm only using the information provided. If I understand correctly, an appraisal was performed. Since the client didn't like the results, they want the appraiser to essentially sign off on the fact that the subject property is "marketable". But she/he already did that. The results of the appraisal didn't say the subject was unmarketable, did they?

To accept this particular assignment, a pretty detailed scope of work would have to be hammered out between the appraiser and the client. One of the purposes of the 2070 is for the appraiser to determine if the client would be better served by performing an appraisal. Here we have a case of a client trying to use it to basically circumvent what an appraisal has already discovered. ("Okay, so it's not worth as much as we'd like, but just sign that form that says it's still standing and everyone will be happy." ----- Until the liablility stuff starts flowing down the hill with you-know-who at the bottom------)

I agree with Larry that if we ask ourselves how comfortable we'd be standing in a courtroom defending our decision to accept the second assignment, we might think again.

I don't think the letter of the law necessarily prohibits us from doing thngs the way they've been described. It just seems it might have been better to decline this one. Let the client find another scapegoat. The appraisal is still valid, although, as Chris pointed out, it's probably hidden away.

Yet another good reason to keep yer nose clean........to smell them rats!
 

Don Clark

Elite Member
Joined
Jan 17, 2002
Professional Status
Certified Residential Appraiser
State
Virginia
B) Lee Ann,

I selected door # 1 for this reason:

Even the Appraisal Foundation has demonstrated several options for doing various types of work in their USPAP instructor certification course material available on their web site under scope of work. They take you through several situations where varying degrees of valuation services are performed based on scope of work.

PS, I will also raise this question when I go to Detroit next wee for the Certification Course(again).

I will follow this thread and present the facts, if that is agreeable to all.

Send me results by 9-3-2003 at

[email protected]
 

Don Clark

Elite Member
Joined
Jan 17, 2002
Professional Status
Certified Residential Appraiser
State
Virginia
:redface: :redface: :redface: OOPS!

Sorry, meant to say Lee Ann :redface:

Don
 

Rich Heyn

Senior Member
Joined
Jan 17, 2002
Professional Status
Certified General Appraiser
State
Michigan
Lee Ann,

Riddle: Why is there no purpose to a 2070?

Ponder this, grasshopper, and I believe you will answer all your own questions.

Rich
 
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