Subject condition

[David S. Roberson]

The house meets MPR's, but is in less than average condition due to damaged floor coverings & interior walls. Condition adjustments were made accordingly reflecting market reaction. The report was submitted as-is, with no required repairs. Here's what they want me to do:

"We are unable to lend on home in average minus condition. Please either consider rating home as average and comps average plus, or rate as average and do subject to completion of repairs. Home is built after 1978, FHA does not require cosmetic repairs. If you are requiring the repairs please state which rooms need to be painted and which floors need to be replaced. Prefer rating home as average and others as average plus and showing repairs as cosmetic only."

How would my peers respond?

 

[Wendy]

I'd have no problem with average if the appraisal was "subject to". After all, you are calling for repairs to bring it to average condition.

If they want "as is", well then I would stick to below average if that is what you feel it is. In my market, damaged floor coverings are not average unless you are dealing with the really low end stuff.

Don't let them bully you into anything. It is was it is - they can pound sand if it does not fit in their box.

 

[CANative]

Condition • Enter the condition of the subject and comparable sales.
• Ratings to be used are: “New”, “Good”, “Average”, “Fair” and “Poor” or a combination if more accurate.
• Consider required repairs or alterations, to the subject, completed when determining the need for adjustments to the comparable sales.

The FHA protocol does not have an in between modifier such as +- .

Use Average for both and make the adjustment anyway and explain in the comments or use a combination such as Avg/Fair for the subject and Avg for the comp or if you're afraid of that (LOL) use Avg for the subject and Avg/Good or Avg/Fair for the comp.

 

[ZZGAMAZZ]

What condition did you indicate in the SCA?

Also, inquiring minds need to know who is "they"?

 

[David S. Roberson]

If Greg is correct, I incorrectly used "Average-" in the sales comparison analysis. My problem with saying that it's average is that the property is not in average condition for the market. It is not average to have very stained and worn floor coverings and large holes in the interior walls.

 

[Wendy]

I find it very funny that "Averge/Fair" is ok and "Average/-" is not.

 

[CANative]

Average - is not a combination of “New”, “Good”, “Average”, “Fair” and “Poor”

I'll bet UW's live in more abject fear than some appraisers.

 

[Anthem]

At what point do damaged/soiled floor coverings become an issue?? I think the statement from FHA is a bit vague on that "Generally worn floor coverings"

Many times I inspect homes that have heavily worn and soiled carpet that no one in their right mind would live in.

 

[Mr Rex]

At what point do damaged/soiled floor coverings become an issue?? I think the statement from FHA is a bit vague on that "Generally worn floor coverings"

Many times I inspect homes that have heavily worn and soiled carpet that no one in their right mind would live in.

When the market rejects it.

 

[Anthem]

When the market rejects it.

The market usually just pays a bit less and replaces it, but the concept with FHA is that the borrower will not be able to afford any costly repairs to the home