Three values, one report

[Terrel L. Shields]

jumbo loans are often conventional

No, by definition they are non-conforming. The fact they require form reporting for both reports (Jumbo usually requires 2 reports) does not make it a conforming loan.

I quit forms over 10 years ago. None of my clients require a form report and probably 50% of my work is residential - large and small tracts, in town and out, and manufactured homes. Occasionally a duplex or apartment. Many borrowers with cash or assets, don't want a long term loan. They are getting 3 to 10 year loans and again, secondary market is 15 or 30 year loans. I have not been asked to do a form report since I dropped forms.

Prior to that, almost all my assignments from banks who did operate in the secondary market were sending me complex reports. New houses with dog kennels or a frame shop. Another was a house and car repair shop, etc. I got tired of being told it was a simple residential property only to be confronted with these complex mixed-use properties and I fired the client. They came back months later wanting me to go back on their vendor list and I told them no.

 

[Terrel L. Shields]

Farm loans are not residential loans

Actually, many farm loans are residential.

Rural Development loans are SFR.
USDA guaranteed loans, offered by USDA-approved private lenders
Farm Credit makes several residential loans - from new construction to existing housing and some have minimum or maximum acreage sizes and many have community size limits. That is, they lend in communities with a population of less than 2,500. The Country Home loan is common. Yes, they also make commercial agricultural loans as well. In disaster situations, even the SBA (Small Business Administration) may make loans to rebuild homes.

 

[Mark K]

I find narratives to be easier but correctly, there is no reason you cannot incorporate additional pages in a form to accomplish the task. Again, if completing a report, a regulated bank under the Interagency Guidelines is required to provide an as is value always regardless of other requirements. That's what the FDIC etal requires of banks.

Its almost hard to believe but, from what I've seen on this forum, there is a huge number of appraisers that have never stepped outside of the form-filling world and the thought of a narrative report scares them. My first 6-7,000 reports were forms but the last 15 years and 2-3,000 of so have been all narrative formats. Some restricted reports only 3-4 pages + addenda and some 30 pages + addenda. I find the narrative format easier once you get the hang of it. From what I've seen of the new forms, a narrative would certainly be easier. A short, restricted narrative report for a divorce, trust, estate, etc. is much easier than a form.

My license expired last year; I'm officially retired but I still work for the local courts. They don't require a license, just competence in the field. My report format is provided by the court and most "reports" are only 1-2 pages, fill in a blank, plus your fee is hourly at the same rate as a typical lawyer.

 

[Tom D]

Do i get any continuing ed credits for reading this thread. Could be a 3 hour course.

 

[J Grant]

Its almost hard to believe but, from what I've seen on this forum, there is a huge number of appraisers that have never stepped outside of the form-filling world and the thought of a narrative report scares them. My first 6-7,000 reports were forms but the last 15 years and 2-3,000 of so have been all narrative formats. Some restricted reports only 3-4 pages + addenda and some 30 pages + addenda. I find the narrative format easier once you get the hang of it. From what I've seen of the new forms, a narrative would certainly be easier. A short, restricted narrative report for a divorce, trust, estate, etc. is much easier than a form.

My license expired last year; I'm officially retired but I still work for the local courts. They don't require a license, just competence in the field. My report format is provided by the court and most "reports" are only 1-2 pages, fill in a blank, plus your fee is hourly at the same rate as a typical lawyer.

A narrative report does not scare me.
The fact, though, is that 99.99 percent of res appraisal mortgage lending work, the clients will not accept a narrative report. And that is the realm the vast majority of res license appraisers work in

I wonder how many newbies doing res mortgage work did a narrative report per advice here only to have it rejected by the client.

I can see where a short narrative report would be easier.

 

[Mark K]

A narrative report does not scare me.

It shouldn't but, be honest now, how many have you completed in your career?

A narrative report does not scare me.
The fact, though, is that 99.99 percent of res appraisal mortgage lending work, the clients will not accept a narrative report. And that is the realm the vast majority of res license appraisers work in

Doubtful its that high %. A lot of high dollar homes are done on narrative.

I wonder how many newbies doing res mortgage work did a narrative report per advice here only to have it rejected by the client.

Probably none.

 

[J Grant]

It shouldn't but, be honest now, how many have you completed in your career?


Doubtful its that high %. A lot of high dollar homes are done on narrative.


Probably none.

Three, but who cares what I think of narrative reports - the point is that res lenders do not typically accept them, and the vast majority of help needed posts are from res appraisers for mortgage lending, and they keep getting advice from a few posters here to use a narrative format.

I do a number of high-value and jumbo loan reports on a form with narrative comments made on the blank addendum page
I have no idea if forms will still be used for jumbo loans when the new UAD 3.6 rolls out because I understand there is no blank addendum page where one can add unlimited narrative comments .

 

[Terrel L. Shields]

The fact, though, is that 99.99 percent of res appraisal mortgage lending work

Again, you need to differentiate between non-conforming and conforming loans. Conforming loans are 100% going to be form reports. But non-conforming conventional loans are not limited except by client's request. The res appraisers who limit themselves to only conventional conforming loans is limiting their career and sunsetting themselves as mortgage lenders get away from appraisal requirements with hybrids, AVMs etc.

 

[J Grant]

It shouldn't but, be honest now, how many have you completed in your career?


Doubtful its that high %. A lot of high dollar homes are done on narrative.


Probably none.

Well the people doing high volume homes as a narrative are not the ones showing up here asking questions.

I do many high-value homes ( over a million $ jumbo loans with properties ranging from a millin to over 16 million in value )- on forms with of course a narrative addendum.

Since the new "dynamic format " does not include any blank pages for a narrative addendum, idk how high value homes that lendes used to order on forms will faree Ot: e. and none of them are done as a narrative. What are we aruingopbon narratietiau

Again, you need to differentiate between non-conforming and conforming loans. Conforming loans are 100% going to be form reports. But non-conforming conventional loans are not limited except by client's request. The res appraisers who limit themselves to only conventional conforming loans is limiting their career and sunsetting themselves as mortgage lenders get away from appraisal requirements with hybrids, AVMs etc.

Appraisers don't limit themselves to conforming loans. Appraisers do not choose the loans their clients provide! We don't give a crap about the loan.

Appraisers with real estate licenses are limited to appraising residential and small-income properties. The reality is that the bulk of work on the residential side is still mortgage lender work. If that were not the case, no appraisers would work for a cheap AMC fee because appraisers on the residential side would have a ton of other business they could seek.

A minority find full-time income with a real estate license in private or other paths, such as working for a county assessor or going into management. However, the number never rises above a minority of real estate licensees who actually make a living that way.

 

[J Grant]

AI using Chat GPT or similar programs can make the narrative writing much faster / Feed a few prompts in, and teach it, and it writes the whole thing. ( even if now appraisers use some canned./clone comments to create narrative )

When a labor-intensive skill or professional skill can be done in a fraction of the time via AI writing programs, the fees will drop.