The "proper" use of the 1004D

[The Bob]

Talk about making a mountain out of a mole hill.

This is where lender guidelines and appraisal practice collide. I've had dozens of these requests.

I simply state that "Some cosmetic/other conditions were noted in the appraisal. The appraisal was made "as is". At the request of the client I have revisited the property to verify that these conditions were repaired".

To me this is outside the original SOW. So its a new assignment. If its a new assignment, then how does it affect the original appraisal? If its not a valuation assignment then what parts of USPAP apply? There not asking for a new value. They want it on the 1004D? Big deal. All of you so concerned about what the form says, how about the 1004 you use every day that is not USPAP compliant? Or the wording you put in your addenda that is the opposite of whats in the pre printed boiler plate?

 

[Webbed Feet]

My last post on this one.

Why I told G.B. I don't think his idea will work is if the 1004d is so altered, the certification redacted out as it would have to be, many lending staff will believe that Fannie will not accept the 1004d form if that has been done to it. Fannie may not. That only leaves two solutions.

A) If the client will accept it a letter from the appraiser in lieu of the 2005 1004d or an older 442 form without contradicting certifications on it.

B) If a demand persists for the 1004d without redactions, then the SOW has to be changed for a corrected "Subject To" real estate appraisal report so that a following 1004d 442 certification is not in conflict with the appraisal report. That would mean a hypothetical condition using CB3 would be best (as underwriting required the illegal unit decommissioned and supposedly it has been done) and the functional adjustments should be removed as the property would now be appraised "as if" the illegal unit does not exist. Now everything matches up and the appraiser is not signing misleading certifications.

If the appraiser wants to charge for all of this work, or not, is up to the appraiser. That point may be a matter of deciding who demanded what, if the SOW Rule was followed or not, or who incorrectly or failed to inform the appraiser regarding the actual Intended Use. Or just customer servicing it because it's better to suck it up, even when not the party at fault, for business sake.

Or forget all about every post shouting caution.... do whatever you want, and hope no board complaint ever gets filed on this one.

P.S. G.B. I spotted your post #30. This thread is NOT about if there is a need to provide an "As Is" value or not! Besides, why don't we perpetuate a myth while we are at it? Long ago every secondary market player I can think of were given exemptions and it was redefined that loans being sold to them did NOT represent federally related transactions! Therefore, if the Intended Use is a sale to Fannie tell me where the FRT is? The source for that is sitting right on my states board's web site and has been, I think, since 2005. Now the only part I don't understand is what happens when secondary market players get essentially "taken over" by the feds? I will admit I have not seen a thing about that. Regardless, .. and I know you know this ... If the transaction value was under $250,000 that "federally related transaction" standard does not have to be adhered to as it is discussed in Statement Ten. I'll be happy to accept it if you document I am incorrect. .. Maybe I am.... .. Maybe I am not.

 

[CANative]

Let's just admit it. The only authority over appraisers are their state boards and a state board is not going to punish an appraiser based on a form protocol disagreement. And that's all that this is.

Our real problem is that we don't like idiots having the power to make us do something lame like certifying the completion of a condition we did not make.

 

[Frederick R. Ruffell]

OK just got off the phone with OREA, per their enforcment appraiser Jhon, I can use the form (or any form) if I alter it in such a manner as to not mislead the user(s).
However going foward I am going to insist on a "subject to" Report.

Now I have another question. In the same situation (i.e the 2nd kitchen is not permitted under the zoning) and we are going to use CB3 for this one, Do I mark the the subject as "legal" "Legal Nonconforming" or "Illegal"? Remember CB3 is being used here.
I feel I should mark it Illegal as CB3 is specific to the final opinion of value only?
What say you all?
The AMC chief appraiser says to mark it legal!!!!!

 

[CANative]

You're letting the tail wag the dog by saying that verbiage in a form is the cause of compliance or non-compliance with local land use regulations.

 

[Mike Kennedy]

OK just got off the phone with OREA, per their enforcment appraiser Jhon, I can use the form (or any form) if I alter it in such a manner as to not mislead the user(s).
However going foward I am going to insist on a "subject to" Report.

Now I have another question. In the same situation (i.e the 2nd kitchen is not permitted under the zoning) and we are going to use CB3 for this one, Do I mark the the subject as "legal" "Legal Nonconforming" or "Illegal"? Remember CB3 is being used here.
I feel I should mark it Illegal as CB3 is specific to the final opinion of value only?
What say you all?
The AMC chief appraiser says to mark it legal!!!!!

FR, review the EA w/CB3

 

[Webbed Feet]

FR, review the EA w/CB3

You meant review the HC

 

[Webbed Feet]

OK just got off the phone with OREA, per their enforcment appraiser Jhon, I can use the form (or any form) if I alter it in such a manner as to not mislead the user(s).
However going foward I am going to insist on a "subject to" Report.

Now I have another question. In the same situation (i.e the 2nd kitchen is not permitted under the zoning) and we are going to use CB3 for this one, Do I mark the the subject as "legal" "Legal Nonconforming" or "Illegal"? Remember CB3 is being used here.
I feel I should mark it Illegal as CB3 is specific to the final opinion of value only?
What say you all?
The AMC chief appraiser says to mark it legal!!!!!

Wait, I am uninformed... There is a difference between an illegal UNIT.... and just a second kitchen that was done without permits. I've seen houses with basement second kitchens, but the entire house is was still only one (1) SFR. .. Also, you have not told us "Subject To" what?

 

[Frederick R. Ruffell]

Mike. If by EA you mean Extraordinary Assumption I was not aware the CB3 ( I assume you mean Check Box 3) had an "EA".Would you please enlighten me? If not what do you mean by EA?

 

[Frederick R. Ruffell]

Webbed, here in the back water village of San Diego we have this old and outdated thing called a Municipal Code. If a property owner has the need of additional utility from their real estate they must get permission from the municipality before they begin to construct physical structures that will provide that additional utility. If they do not then they are in violation of the code (read illegal). Crazy huh? People should just be able to do what ever they want with their property, I really want to build my own combination lighter fluid bottling facility and steel grinding and cuting facility at my house. Hey what is a basement?, do you think I could build my combo plant in one?