Special assessments

[Renee Healion]

Sales in the complex show what the properties bring the seller who has to pay the balance, if the SA was in place for all of them. Don't deduct it from sale prices. Sorry I got stuck seeing refinance in bold. I bug out because I cannot believe that I am still asked to agree with HOs, agent, whomever who say 'A MV appraisal is different when it is a refi, right?'. Nope.

 

[bnmappraisal]

Sales in the complex show what the properties bring the seller who has to pay the balance, if the SA was in place for all of them. Don't deduct it from sale prices.

YYYYYYYYYYYup

 

[Meandering]

If the requirement is for all HOs to pay the assessment by day X,
and everyone else has paid, but this one can't afford to pay it,
and hence, is among one of the reasons looking for a refi,

The terms of selling with the assessment still in place, still has to be considered by the appraiser as a possible impact to the sale price,

AS-IS
AS-OF
the day.

Unpaid, it is a liability lien, which may or may not move to the first lien position, depending on other circumstances, so yes, it is possible that other sales in the complex were sold after the assessment was cleared, before, or at closing, resulting in no sales with a similar lien risk.

.

 

[J Grant]

I was curious on how you handle condo special assessments on a refinance appraisal.

Condo
Value of approx $405K
There is a special assessment for the condos in that development for work that has already been completed.
Special assessment balance of about $30K for that condo
Borrower has not paid the full assessment off and is paying monthly
Sellers have to pay the assessment before the property can be sold.

Would the special assessment be deducted from the value when doing a refinance appraisal or how would you handle?

Thank you!

Remove confusion about refinance...it is a market value purpose appraisal and the SC approach is a hypothetical sale of subject as of X eff date, regardless of whether the subject is actually 'for sale" or not. If all the condos had same provision from HOA that the assessment be paid at closing, then all the sales transactions in subject bldg were subject to that , so any or no affect on MV of the assessment would apply to all the sales.