Three Story Home

[Nancy Jackson]

Originally posted by Bill Potts@Jul 18 2003, 06:26 AM
Ok, all of us, would you want an appraisal out there that was not correct? If Nancy is correct, and the appraiser is wrong. I would fix the appraisal. Maybe that's just me, but I would do it if I was wrong.

Bill,

I told my lender about my concerns and asked her to talk to the appraiser about it. She is swamped, so when I called her, I suggested I call the appraiser myself. She gave me the number and I called.

I felt I was diplomatic in the way I presented my concerns, but the appraiser went on the defensive, saying that the value would remain the same, that he had followed Fannie Mae Guidelines, that he was not even supposed to be talking to me by law and that maybe I should get an appraiser from the city next time.

I was expecting more of a response like yours, a "let's look at this and see if I need more information, maybe I should have looked at it a different way" response, a rational discussion of third floors, urban real estate.

Thanks for your support.

 

[Richard J. Glesser]

I'm sorry the other appraiser gave you a poor impression of us as a profession and certainly would not have responded in the way he did. I will not defend any of his actions hereafter since he appears to have buckled under the pressure of the current workload. :usa:

 

[Nancy Jackson]

Originally posted by Richard J. Glesser@Jul 18 2003, 10:56 AM
I'm sorry the other appraiser gave you a poor impression of us as a profession and certainly would not have responded in the way he did. I will not defend any of his actions hereafter since he appears to have buckled under the pressure of the current workload. :usa:

Richard,

Don't worry about my appraiser tainting my view of the profession. I am appreciative of the time you and others have taken to answer my question. While taking real estate classes last year, I had given thought to pursuing a career as an appraiser. The education requirements did not discourage me, but the 2 year apprenticeship did. I can't afford to leave my current job for a much reduced pay at this time.

I have read quite a few of the threads on this board and really respect the knowledge and willingness to share it.

 

[Pamela Crowley (Florida)]

Hi again Nancy,

I'm sorry you received that response, but....

If you had said ANYTHING to him about the value, that would be a prime reason for an appraiser to cut off the conversation, and I would too. You have no idea how many calls appraisers get complaining about the value and often from those that we absolutely are not allowed to discuss it with. It's really rare that we get a call that says "Thank You" for saving me from making a mistake. So, without making an excuse for being rude, I can understand that reaction. Pretty much everybody thinks their appraisal is too low when in reality, many appraisals are too high. The pressures put on appraisers in this past year have been higher than I can ever remember with just about everyone involved wanting it faster, cheaper, faster, higher, faster! Then the constant calls saying "How dare you come in so low! I'm not going to pay you!" With all this worse than it's ever been before, I can understand his not wanting to talk to you and will admit that I avoid the phone calls from the homeowners because of this.

I would suggest a letter to the appraiser. Maybe print out this thread and include it. If I had made a mistake like that, I would definately want to correct it. It's also possible that he was not trained properly, which is admittedly a problem in the appraisal business, and truly believes he completed the appraisal properly. Without actually seeing your property and his appraisal, I really don't know what is correct.

I do understand you wanting it correct. I also understand his initial reaction. Please put it in writing to him and please don't go into anything about the value.

Let us know what happens.

 

[Nancy Jackson]

Hi Pamela,

Thanks for your suggestion, Pamela. Are you saying that an appraiser may not talk to a homeowner about value, but may talk about room count, square footage, description etc?

I definitely did not say anything to him about the value. In fact, his appraisal came in exactly on the number I had estimated on my loan application. That did seem a little odd to me though. Do the lenders give appraisers any idea of value before the appraisal or did I just make an informed guess, knowing the neighborhood and its homes fairly well?

Is is standard procedure for lenders to give a copy of the appraisal to the borrower? I have looked for the appraisal from when I first bought the house and can only find the list of repairs required by FHA. I was interested in checking how the third floor was treated in the first appraisal.

I really have found this discussion very informative. I have found myself trying to understand the details of the appraisal. I believe you have a very analytical and difficult job. Last night, I brought out the form and noticed my appraiser said the porch & deck were similar in the comparables. I actually do not believe any of them have decks (but I would have to walk around back of the houses to make sure) and my porch is a wraparound porch where the comparables had very simple porches. I assume since the value needed for the loan was reached, the appraiser did not really compare them closely? Or porches and decks don't add much value?

 

[Pamela Crowley (Florida)]

Are you saying that an appraiser may not talk to a homeowner about value, but may talk about room count, square footage, description etc?

When the appraisal is for a lender, the appraiser is not supposed to talk to the homeowner or anyone else about the appraisal. We can talk in general terms about room counts, etc., but not about any specific property or appraisal - except with the named client on the report.

Do the lenders give appraisers any idea of value before the appraisal

Most often - and scream to high heaven if it's any lower than what they want. The best appraisers ignore it.

Is is standard procedure for lenders to give a copy of the appraisal to the borrower?

Some lenders always provide a copy of the appraisal, some don't. If the borrower asks for a copy prior to or just after the closing (can't remember the time frame), they must provide a copy.

I assume since the value needed for the loan was reached, the appraiser did not really compare them closely? Or porches and decks don't add much value?

The appraisal should have been completed properly with market derived adjustments no matter what. Some appraisers were taught that they should 'bring it in' on or close to what the lender wants, even if it would typically appraise for more. My first supervisor when I was a trainee told me this. Typically, porches and decks are not large adjustments and sometimes, it's difficult to find any justifiable adjustment for those items. It really depends on the particular market area and the amount and quality of the data available. Maybe talking with a couple of local experienced Realtors and asking them the reactions of typical buyers to the various sized porches would help. What it boils down to in appraisals is, if there were two properties side by side and identical in all ways except one has a regular front porch and the other has a wrap around porch, how much extra would the majority of typical purchasers pay for that difference.

Good for you for paying attention and wanting to learn!

 

[wyecoyote]

Nancy,

I belive that Pamela is giving you some very good advice on the issue. The one concern is that the opinion of market value was right on you opinion of market value. The problem is that some appraisers as Pamela stated appraise to the HO's opinion of value or the value needed to complete a loan. It would be to borrow from Richard's example a person walks into a CPA's office and says that I want $5,000 back from my tax return and you get it for me or I will go to another CPA who will. Doesn't matter that the tax return should only be $3,500. That is the problem with some appraisers in this profesion they will appraise to the value required to make the loan work.

The appraisers discussion of FNMA standards is simple. I didn't see anyone address this question of yours so I will attempt to for you. FNMA guidelines simplified states that all comparables are adjusted the same way so as not to mix adjustments up. So in your case if the appraiser included the third level as an attic area and did the same for all the other comparable sales attic areas then he did this standard correct. However, if he adjusted your third level for an attic level and the third level for the comparables as GLA then he would be incorrect.

Also as Pamela stated if a HO called me and wanted to discuss value or the appraisal with him/her I would not. Basically it boils down to client confidentiality. Try getting a Lawyer to talk to you about their clients case. They won't do it they make comment generally about the law and the legal system but not about their case. Much the same as an appraiser we can not discuss the appraisal with anyone but the client (lender). The subject that we appraised is our "case". We can discuss the basic appraisal process with people but not the subject that we appraised.

Should the appraiser fix the problem my thoughts yes it should have been completed right the first time. And if he/she was unsure of the subject and had never completed a house like yours before he/she should have taken the neccessary steps to be competent in the process. But then again I am only going off your description of your property and not actually seeing the property and/or the appraisal to make true informed statments of facts.

 

[Richard J. Glesser]

I believe Pam hit on a sensitive issue when she said that the appraiser may not have been trained properly but her suspicion was confirmed in my mind when you stated the appraiser hit your estimated value on the head.

I agree with Pam's advice of sending a letter with a copy of this thread but, remember, he's still swamped with probably late assignments and will not be apt to take time to address the issue. While I welcome the opportunity to correct errors on my reports, also remember that he doesn't think he's in error. After the letter, I'd let it drop, knowing that you're correct and happy that your loan has closed. :usa:

PS Ditto Pam - keep us informed.

 

[Nancy Jackson]

Originally posted by Pamela Crowley (Florida)@Jul 15 2003, 10:40 AM
It's slow in being used by all, but the ANSI Standard for measuring is the standard we all should be using.

Attic space being counted as Living Area needs to meet certain standards which your county officials may or may not be familiar with. It is extremely rare that an appraiser's measurements match the county.

----------------------------------

Ceiling height needs to be at least 7'.

No space is counted that is less than 5' tall.

The 7' or higher ceiling space needs to be at least 50% or more of the square footage that is over 5'.

Finish needs to be at least equal to the rest of the living area.

Stairs needs to be reasonably adequate - as in not narrow or steep.

-----------------------------

As long as the appraiser treated all the comps with finished attic space the same as yours, the appraisal is likely correct in it's comparisons.

Without knowing your market, I cannot make any further determinations. I hope this helps. I'll see if I can find the link to the ANSI Standards for measuring residences to post here for you.

Hello,

I am trying to get my letter together to the appraiser and/or lender regarding the third floor square footage. I had found the ANSI standardd online, but have since lost the link in my favorites. Does anyone know exact title of the standard with the numbers and all? I believe that is how I found it last time I searched.

 

[Mike Garrett RAA]

Sounds like more energy and time was expended in this thread than the appraisal. I cannot comment on the appraisal because I have not seen it. Are we beating a dead horse here? The appraisal served it's purpose, your refinance was completed.