Retro Complete Field Review

[J in Florida]

I got an inquiry to do one of these. Is there any special form, is it necessarily any different than a Form 2000, and are there any special considerations due to the retrospective date? Would the fee be significantly different that a regular field review?

I have never done one of these, thanks for any input.

 

[Scott Kibler]

Aren't all field reviews retrospective? You don't get many with an effective date of today, right? Price it according to the accessability of your data sources for the effective date of the report to be reviewed.

 

[J in Florida]

Sorry Scott--It's retrospective to March, 2003. Yes every review is retrospective, I was just wondering if retro 2 years old has anything significantly more risky to the reviewer.

 

[Farm Gal]

J:

Typically such retro full reviews are generated if the lender has either a failed loan or they have deep reason to suspect the veracity of the original report.

Make VERY sure your review report is fully Std 3 compliant and has the documentation IN the workfile to back each and every statement and adjustment you place in your review. This kind of report may lead to face time in court... OH YEAH - make sure you state that any further personal attendance required of you as a result fo your review will be at a compensation rate of ___your normal fee.

If you have full interior access, document with additional photos... but do NOT presuppose that the interior condition today is the same as of the effective date. It is stone amazing how badly a motivated party can trash a property. You gotta give the appraiser the benefit of the doubt, unless there is clear evidence indicating the place was a complete pit as of the effective date!

I LOVE retro field reviews, as long as I can get the full scoop on what was going on back then . 12-24 months back isn't bad, cause you probably have GOOD MLS data and can take a good look at the closed sales AND "what was active but closed subsequent to the effective date" by doing a little tweaking of he MLS records!

The important things are to make sure that you are looking at the speciific time frame of the EFFECTIVE DATE. You don't get perfect 20/20 foresight when you do a present time appraisal: you don't know what sales will close or at what price, don't expect the original appraiser to have such foresight either!

You CAN however look at what sales were actively listed as of the effective date to insure that you have a good handle on the principal of substitution some data systems make this easier than others.

I do put a little more work into the nuts and bolts of verification... interviewing at LEAST one of the principals in each transaction used in the report and any that I elect to use as alternate comparables (if I wholly disagree with the original appraisers choice-es)

 

[J in Florida]

Thanks Lee Ann.

The special instructions were in red: Report here reasons why you believe the original report is erroneous. Include specific information about sales history, tax or MLS records, etc.


It sounds to me like they think this one may have problems.

 

[Restrain]

When writing it, always address the "appraisal", not the "appraiser". Be prepared to take the report completely apart.

Step 1 is to do a market analysis and see if the value's even close. I've done a bunch where the appraiser goes 3 - 7 miles away for comps while ignoring similar homes within the subdivision with no rational as to why.

Look for support. A lack of support for the sales and adjsutments is a dead giveaway that this sucker ain't agonna fly.

 

[J in Florida]

We may have a live one here.

Appraisal done 3/2003 was $105000. Just listed last week as a Fannie foreclosure for $63900. Subject is 5/2/1, 1000 SF, YB 1915. Comps in the original appraisal "appear" to be similar, but were all refurbs, no adjustments were made for condition/effective age or whatever, and no comments made to the effect. Subject is vacant lockbox. This should be good.

 

[Craig in Oregon]

J in Florida,

Craig in Oregon here.

Hopefully you have a report or reports from the same neighborhood circa March 2003 and maybe some you did for refi's in 2001-2002-2003 that turned into sales in late 2002 to early 2003.

This is a really good time to raid your files and also any files from other reliable appraisers (not necessarily for their value conclusion but for their first hand inspection info) for properties that became sales in the time period.

I might also use the benefit of hindsight to use listings and pendings of March
2003 that closed at a slightly later date -- like into May or early June since the set asking prices and marketing were concurrent with the effective date. These would be for added support not necessarily Sales 1, 2 and 3.

Can be fun detective work. Should pay you well for the extra eyestrain.

 

[J in Florida]

It looks like the key to this assignment is the condition of the subject at the time of the original appraisal. The sales used in the appraisal were "refurbed" according to the listings, although I have not yet been able to determine the extent of the refurb. There were also sales that could have been used that would indicate a value of $10k lower than the appraisal. These other sales made no mention of updating.

My hunch is that the non-refurbed sales may have been more appropriate, but that again depends on what condition the subject was in at the time of the prior appraisal. The prior appraisal was done for a refinance, no real estate agents were involved. It was subsequently foreclosed upon. The subject was listed a few days ago at $63000 and had a contract accepted in one day. There appeared to be damage to the subject that very may well have been the result of a p*d off homeowner.

If there is no way to dispute the condition rating by the appraiser for the subject as of the date of the appraisal (2 years ago), is it reasonable to second guess the appraiser as to which comps to use in the report--the "refurbed" ones, or the non-refurbed ones? It seems to me that I must use the extraordinary assumption that the subject was in the condition as reported in the appraisal.

 

[Jo Ann Meyer Stratton]

One of the advantages I have of my small market area (number of sales not square miles), my own computerized data base and detailed records of every appraisal order, listing, for sale by owner ad, etc, etc, etc for every residential property in my two counties since 1996 is that I have access to the photos and all the above documentation in assessor's parcel number order. So I pull up all the data and photos of the subject and all comparables at the time of appraisal under review. I use those photos for the comparables with an explanation. I use current photos and sometimes also photos of the subject property at time of the original effective date, again with explanations about the differences between the two dates.

There is an advantage of doing appraisals in a small town!!