Seller Concessions Changed After Appraisal

[Mile High Trout]

Their explanation was intended to influence the OP to change the adjustments to the comps which would change the value indications for the subject.

I considered that, but how could that have done anything except drive the price downward?

 

[RSW]

I think everyone misunderstands. The developer's explanation was not intended to influence the OP to consider the subject's concessions in developing the value opinion. Their explanation was intended to influence the OP to change the adjustments to the comps which would change the value indications for the subject.

I completely agree with you.

 

[RSW]

I considered that, but how could that have done anything except drive the price downward?

It wouldn't drive the price downward until it was used as a comp. in another appraisal.

 

[Joyce Potts]

At the very least, ask for the HUD-1's for those comps. Then take the time to learn how to truly analyze them as to just how ingrained those concessions are ingrained and disguised in the deals.

Look to the credits, deposits and who holds the escrow(s) deposits, Luke.

No doubt, it's the same game as argued in:

http://appraisersforum.com/showthread.php?t=167881

 

[CANative]

I've never seen a HUD-1 except on one of my own refi's. How is an appraiser going to get this document on all the comps he/she may or may not use in appraisal assignment. I'd have to look at dozens (if not hundreds) to support some sort of trend opinion.

Please describe (in detail) your method of obtaining comp sale HUD 1's in all of your residential assignments.

 

[route1pj]

An appraiser is asked to show an opinion of Fair Market Value of the subject property on a specific date (generally date of inspection) based upon Sales Comparison Approach, Cost Approach, and Income Approach. With the Sales Comparison Approach being the most reliable for transactions that have many similar closed comparable sales available.

If the comparable sales have personal property, sale concessions, or special creative financing terms, the appraiser must analyze those contributions to the value of these comparable sales. Be very diligent in obtaining these contributions, then adjust accordingly in the grid based upon paired sale analysis done by the appraiser. That is what should determine the Fair Market Value of the subject property.

The price of the subject property may be different than its Fair Market Value. So what? We as appraisers are not asked to establish the value of the transaction, but the Fair Market Value of the subject property which serves as the vehicle used as collateral for financing, taxation, etc.

I personally abhore the fact that appraisers must analyze a subject property's sale contract as routine appraisal protocol. That contract usually exibits someone's hope of value for the final sale price and is generally loosely founded upon irrelevant characteristics that have little or no market impact (paired sales analysis). When, in fact, most sale contracts are sent to the appraiser with the hope of influencing his opinion of Fair Market Value for the subject property. "They ask you to do something, and then tell you how to do it" and at what price.

Stand your ground and tell the UW that you did a complete summary appraisal on the date of inspection and that copyrighted appraisal cannot be adjusted or altered. It stands on its own. You are done with that appraisal. He can use it, as is, or order a new appraisal.

I recently had a 10 year veteran loan processor/underwriter (loan pimp) tell me point blank to amend my appraisal and use comparable sale that closed 10 days after date of inspection (which he hoped would influence upward the value of the subject). Guess what I told him.

 

[CANative]

That contract usually exibits someone's hope of value

It just exhibits what the seller and buyer have agreed to at that point in the transaction.