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Satisfactory Completion Certificate - 2 Year old appraisal

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Geoff Hatcher

Thread Starter
Junior Member
Joined
Jan 23, 2002
Professional Status
Certified General Appraiser
State
Ohio
Just did a final inspection on a property, originally appraised In October of 2000, subject to completion per plans and specifications. Property was in the $1.5 million range, near the top of our market.

Reading form 442 and it indicates "Itemized below are substantial changes from the data in the appraisal report, and these changes do not adversely affect any property ratings or the final estimate of value in the report"

The data up to the effective date of the appraisal has not changed, however since then there may have been some changes in the high end market that may have an impact on the current opinion of market value, but would not know without fully verifying all new data.

What exactly are they asking for on the form?
 

Jo Ann Meyer Stratton

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arizona
Note the date at the bottom of the 442, prior to the adoption of USPAP. If they said they were going to install $100 per square foot ceramic tile and instead installed $1 a square foot vinyl sheeting--you would note that and the difference in value that vinyl would have made in 2000. But if they did build the home exactly as planned or exceeded those specs, just state that the home was completed per plans and specs. Take photos of front, rear, street, interiors if you wish, send in the 442 (only comment the items that exceeded the specs, without any values if you wish) and an invoice--end of story.

Now if they did put in more upgrades and amenities into the home that could affect the value as of today or the market has changed and they now want to know if the value as of the new effective date is at least the Oct 2000 value or has changed because of the market/subject changes, then you have a new assignment and you would need to do either an updated appraisal with a complete new package of 1004 or 2055 or if you (not the lender) determine an Update to an Appraisal report in letter format would be sufficient, then a letter might suffice. But that length of time and with changes to both the subject and the market--I would be inclined to do a new 1004 or 2055. See page 100 of the 2002 USPAP or page 90 of the 2001 USPAP. As always I offer to send a sample Update to an Appraisal letter to anyone that asks. And effective 01/01/2003, the term Update to an appraisal changes. Just becomes a new assignment that referances a previous assignment (which is what an update already is!).
 

Mike Garrett RAA

Elite Member
Gold Supporting Member
Joined
Jan 14, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
A 442 doesn't ask if the market has changed. You should report any physical changes to the property....otherwise your value conclusion is as of the date of your appraisal. You could tell the lender that in your opinion they need an "Update of the Appraisal" because the market has changed.
 
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