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Subject To: Septic & Termite Certs ?

bnmappraisal

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Joined
Nov 9, 2011
Professional Status
Certified Residential Appraiser
State
Florida
Econ - It does seem to be a bit "bogus" or "phony" but we've all been there, I'm sure.
I do disagree with the below:
make the extraordinary assumption because obviously nobody cares...
Remember, FHA/HUD is still an intended user. So even if the lender is "OK" with the report and may not seem to care ... I think FHA/HUD may
Just my $0.02
 

Econobot

Junior Member
Joined
Aug 9, 2019
Professional Status
Certified Residential Appraiser
State
Colorado
Do you condition the appraisal on inspection/verification of the EA?
Did you not read the previous post? About the homeowner who did nothing but provide a receipt and the entire issue was a waste of time. My septic language was developed for exactly what the OP is dealing with. I also state that the utilities and appliances were turned on and appeared to be operational. I can put as many EA's into an appraisal as I want. I don't care what the pre-printed certs say, I have my own cert and so should you. I'm in a rural area, if you've never worked in a similar ,market please save the forum your opinion because it's nothing like what you suburban dwellers see. If it hasn't dawned on you my language in the report is basically saying the place is being lived in like a typical person would. Meaning they aren't using the kitchen oven for heat and the power is on....
Appraisers are not allowed to add an EA to a URAR appraisal ( read the certification page, no changes or additions to the printed on the form assumptions are permitted )

That aside, why would an appraiser take on the liability of making an EA that systems are functioning properly when they do not know that is true? All the appraiser knows is the date/time they are at the subject they did not observe a problem. Unless an appraiser notes an observed defect or repair issue in their appraisal, the assumption is baked in that report is systems are operational.
Some of the AMC folks that review reports don't read them so I make sure to have clear verbiage and EAs so they don't ask me or send revision. You do what you and I'll do what I do. Again, if you haven't worked in rural America where septic systems are typical you might should stop commenting on the thread....we don't need more trolls discussing pre-printed certs....which BTW don't mean a damn thing anyway, ask your E & O provider.
 

Econobot

Junior Member
Joined
Aug 9, 2019
Professional Status
Certified Residential Appraiser
State
Colorado
Econ - It does seem to be a bit "bogus" or "phony" but we've all been there, I'm sure.
I do disagree with the below:

Remember, FHA/HUD is still an intended user. So even if the lender is "OK" with the report and may not seem to care ... I think FHA/HUD may
Just my $0.02
Believe me I care, I will condition a report every time I run into something and at a minimum I discuss with interested parties to try to find out what they know. So what do you do when the owner doesnt complete the required repair but tells you they did?? This is exactly what an EA is for.....its almost a scape goat but what are you supposed to do?? As long as you put that the EA if found to be false, could alter assignment results you've done your job. Appraisers do not enforce, we observe, condition, and report. When in doubt KISS...and never use a pre-printed cert
 

J Grant

Elite Member
Joined
Dec 9, 2003
Professional Status
Certified Residential Appraiser
State
Florida
Did you not read the previous post? About the homeowner who did nothing but provide a receipt and the entire issue was a waste of time. My septic language was developed for exactly what the OP is dealing with. I also state that the utilities and appliances were turned on and appeared to be operational. I can put as many EA's into an appraisal as I want. I don't care what the pre-printed certs say, I have my own cert and so should you. I'm in a rural area, if you've never worked in a similar ,market please save the forum your opinion because it's nothing like what you suburban dwellers see. If it hasn't dawned on you my language in the report is basically saying the place is being lived in like a typical person would. Meaning they aren't using the kitchen oven for heat and the power is on....

Some of the AMC folks that review reports don't read them so I make sure to have clear verbiage and EAs so they don't ask me or send revision. You do what you and I'll do what I do. Again, if you haven't worked in rural America where septic systems are typical you might should stop commenting on the thread....we don't need more trolls discussing pre-printed certs....which BTW don't mean a damn thing anyway, ask your E & O provider.
You keep running your mouth at experienced appraisers they should leave the field lol, meanwhile your advice will lead right to a USPAP violation. Following the certs on a URAR form not to add or alter assumptions is an assignment condition, and not fulfilling an assignment condition is a USPAP violation.

What does any of this have to do with rural America? I appraise in rural pockets in my county and in subdivisions where septic is typical.
 

CANative

Elite Member
Joined
Jun 18, 2003
Professional Status
Certified Residential Appraiser
State
California
By using an EA you're saying you don't know if the septic system meets MPR and are trying to make the appraisal "as is" (in order not to be confronted by your clients.) That is not the HUD protocol. Read the f'ing handbook, econodunce.

Maybe 1 in 10 properties I appraise have public wet utilities. Nearly 5,500 square miles with a density of 25 people per square mile.
 
Last edited:

CANative

Elite Member
Joined
Jun 18, 2003
Professional Status
Certified Residential Appraiser
State
California
Econo is trying to mitigate liability by communicating a misleading appraisal report. The expectations of users that rely on these forms is that unknown conditions that can have a potential adverse impact on the subject property will be subjected to an inspection of that (those) conditions.

So yes. You can probably sneak it through underwriting and never see it back on your desk again. But you've done your client a disservice.

Are you sure you're really an active appraiser?
 

CANative

Elite Member
Joined
Jun 18, 2003
Professional Status
Certified Residential Appraiser
State
California
If the appraisal has no conditions, the Appraiser must render an as-is value opinion.

If the Appraiser must conclude the report under a hypothetical condition or extraordinary assumption, the Appraiser must report the issues and requirements as one of the following:

• “subject to completion per plans and specifications on the basis of a hypothetical condition that the improvements have been completed;”
• “subject to the following repairs or alterations (list them) on the basis of a hypothetical condition that the repairs or alterations have been completed;” or
• “subject to a required inspection based on the extraordinary assumption that the condition or deficiency does not require alteration or repair.”
 

bnmappraisal

Elite Member
Gold Supporting Member
Joined
Nov 9, 2011
Professional Status
Certified Residential Appraiser
State
Florida
I'm in a rural area, if you've never worked in a similar ,market please save the forum your opinion because it's nothing like what you suburban dwellers see.
Your comment above (from post #12) I'm assuming is directed @CANative since that's who you quoted
I'll just say, he is one of a handful of people from this Forum that, besides going directly to FHA/HUD, I trust his knowledge on the subject

I don't know him personally (pretty sure we live some 3,000+/- miles away from each other) but his knowledge/expertise on FHA/HUD info is highly respected
And from his posts (again don't know him personally), he seems to be in a pretty "rural" type location
 

bnmappraisal

Elite Member
Gold Supporting Member
Joined
Nov 9, 2011
Professional Status
Certified Residential Appraiser
State
Florida
This is exactly what an EA is for.....its almost a scape goat but what are you supposed to do?? As long as you put that the EA if found to be false, could alter assignment results you've done your job. Appraisers do not enforce, we observe, condition, and report.
"It depends" ... depends on "what" we observe ...
EA and HC are not the same thing and have different definitions

If I "observe" a leach field with standing water ... I don't think I can just EA it away (HC could come in handy though - depending on SOW)
 

Econobot

Junior Member
Joined
Aug 9, 2019
Professional Status
Certified Residential Appraiser
State
Colorado
If the appraisal has no conditions, the Appraiser must render an as-is value opinion.

If the Appraiser must conclude the report under a hypothetical condition or extraordinary assumption, the Appraiser must report the issues and requirements as one of the following:

• “subject to completion per plans and specifications on the basis of a hypothetical condition that the improvements have been completed;”
• “subject to the following repairs or alterations (list them) on the basis of a hypothetical condition that the repairs or alterations have been completed;” or
• “subject to a required inspection based on the extraordinary assumption that the condition or deficiency does not require alteration or repair.”
5. The appraiser has noted in this appraisal report any adverse conditions (such as needed repairs, deterioration, the presence of hazardous wastes, toxic substances, etc.) observed during the inspection of the subject property or that he or she became aware of during the research involved in performing the appraisal. Unless otherwise stated in this appraisal report, the appraiser has no knowledge of any hidden or unapparent physical deficiencies or adverse conditions of the property (such as, but not limited to, needed repairs, deterioration, the presence of hazardous wastes, toxic substances, adverse environmental conditions, etc.) that would make the property less valuable, and has assumed that there are no such conditions and makes no guarantees or warranties, express or implied. The appraiser will not be responsible for any such conditions that do exist or for any engineering or testing that might be required to discover whether such conditions exist. Because the appraiser is not an expert in the field of environmental hazards, this appraisal report must not be considered as an environmental assessment of the property.

Summarizing the observation of a septic system and it's perception within the market has nothing to do with "concluding a report"...
Please tell me how making a physical observation followed with "appears to be functioning properly" and that this is an extraordinary assumption is going to make me liable for a septic system?? I'm no lawyer but this is the purpose of an EA... Someone earlier posted that the appraisal report itself assumes everything is working with the subject, that's even more misleading than my statements??. I prefer to be clear that I did observe and everything appeared in order and emphasize it's an EA, I'm not an inspector and they should seek one if they are truly concerned. This is ultimately no different than any other statement about utilities or mechanicals, oven got turned on, fridge was cold, toilet flushed like any other toilet... I developed this verbiage after a chief appraiser asked me to comment on functionality, I said sure, but it's going to be an EA....

Your comment above (from post #12) I'm assuming is directed @CANative since that's who you quoted
I'll just say, he is one of a handful of people from this Forum that, besides going directly to FHA/HUD, I trust his knowledge on the subject

I don't know him personally (pretty sure we live some 3,000+/- miles away from each other) but his knowledge/expertise on FHA/HUD info is highly respected
And from his posts (again don't know him personally), he seems to be in a pretty "rural" type location
That's all fine and dandy but a wise man once said, "things change" A new chief in the regional FHA office and guess what, things change. Nobody knows everything, the pursuit of knowledge is greater than the storage (if you will), it's why an appraiser can gain competence... Do your own work and become better at it.... This profession is filled with copy cats and drones filling out forms...that's been statistically proven from a study of adjustments, appraiser's were using, "what their mentor used" in the majority of instances...
 
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