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Underwriter Request

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Joe LaRosa

Thread Starter
Freshman Member
Joined
Mar 20, 2002
How would one respond to the request of an underwriter who requests and estimated cost to cure for painting a porch railing which obviously would be less than $20. Also, in the addendum it is stated that the roof is older and appears to be reaching the end of its economic life - further stating there was no evidence of any leakage in the interior and no depreciation was noted. Underwriter is asking for an additional comment regarding the roof. Hey - what else can I say - except maybe that as I have no expertise in this field they should call in a professional roof inspector, eh?
 

airphoto

Senior Member
Joined
Jan 15, 2002
Professional Status
Retired Appraiser
State
Pennsylvania
Joe,

Just put in your addendum that, presuming some old paint to be available at a yard sale, and applied with a used napkin, that the cost to paint the railing (presuming the homeowner pays his elementary school child $.25 in allowance) should be under $.50. Then, add the comment (in quotations) "An additional comment regarding the roof." Say no more, and send it in ..
 

Blue1

Elite Member
Joined
Jan 14, 2002
Professional Status
Certified Residential Appraiser
State
California
Ask the underwriter to FAX you their appraiser license. OR What part of the 1004 can't you understand or read? Sorry just venting a bit.......
 

Mountain Man

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Georgia
Be nice :!: Send the UW what they want.

Just type a statement like: "The estimated cost to re-paint the railing on the front porch is $25 for one gallon of paint"
That way they can escrow $50. :lol:

As for the roof, just recommend a professional inspection from a home inspector. Hey, we gotta take care of our brothers & sisters on the other end of the transaction. :wink: :lol:
 

BarbaraNJ

Junior Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
New Jersey


JOE:

I dislike being asked for a "cost to cure", for several reasons.

First, I feel like I'm being asked to do someone else's job for them.

Second (I agree with you) I am not an expert in every field and am only there to observe and report, not to fix/repair the problem.

Third, must we ALSO keep a file on all of the current costs of housing materials? How many appraisers know the current costs "per square" of the ten or more grades of roofing shingles, as well as the cost per square to install?? Do you recommend a "re roof" (over existing) or "rip and roof" (totally remove all existing roofing material to deck). By the way, before you recommend either method, you have to be able to determine how many roof layers are currently on the home, and know the building code for number of layers allowed !!!!!!

Finally, what if your estimate is wrong ??? If you are really low in your estimate, does the lender or the borrower have a right to sue you someday?

You are right to be concerned and upset. My best recommendation is exactly what you said-----write the lender a letter telling them that you are a licensed appraiser, and can answer any appraisal question. Construction questions should be answered by a licensed contractor.
 

TEL2002

Elite Member
Joined
Jan 16, 2002
Professional Status
Retired Appraiser
State
Louisiana
Why not just let them know that the minor cost to cure items were already incorporated in the condition grid. whether it be +- or =.

Then add the statement that 'after viewing photographs of the subject, a roof inspection by a qualified professional is recommended by the UW".
 

Paulette in Texas

Sophomore Member
Joined
Jan 24, 2002
Master planned community with 5 very large sections with typical range $80 to over $1m. Predominant value $200's. Subject is well representative of homes in the area. All of the above and more described in detail in report along with absorption rate analysis. Comps are close, bracketed and within all guidelines. Idiot has nerve to want to know why subject is less than predominant value. the property is $100k. When they have no understanding of what the URAR and narrative is all about, there is no hope. The builder is pulling loan and taking it to companies with knowledgeable review and underwriters. Sometimes their ignorance gets what they deserve...no client. Works for me. Paulette in Tx
go w...
Rotts rule and Shih Tzus fine.
 

Richard Carlsen

Elite Member
Joined
Jan 15, 2002
Professional Status
Licensed Appraiser
State
Michigan
I'm with Barbara up above in that I hate being asked to do a Cost to Cure unless it is my idea as a way of adjusting for a problem.

One lender wanted Cost to Cure as a normal practice for anything and everything that could be wrong with the property. I questioned them if they wanted an "as is" value or a "when repaired" value. They said BOTH!" Sounds like two appraisals to me.
 

bradellis

Member
Joined
Jan 16, 2002
Hiya folks,

This is NOT addressed to any one particular post- but to the string in general.

Just what is the problem with being asked for a cost to cure? You can easily make a statement that you are an appraiser and not a contractor and that the cost to cure is simply your best estimate and that a contractor would be required to provide a more accurate estimate. Then, look in your M & S book for the segregated cost for the item. In the case of porch paint, you do not even have to look it up.

Uncomfortable with the roof? Call a roofing contractor and ask what it would cost to tear off and replace a roof of 10 squares (if that is the roof size) with composition shingles.

In the assignment in question, the porch paint is irrelevant. it was asked for because of underwriting guidelines- that's all. They are not intentionally trying to be petty. In the case of the roof, it is very important. Is this not a value factor as part of overall condtion?

As an appraiser, you MUST have some knowledge of construction practices and costs- you cannot avoid this. Get the knowledge or suffer the consequences- the first of which will be the totally ethical and experienced competing appraiser who can and will do this. Bad enough to lose business to the "number maker". Worse when you lose additional business to those of us who can and do the work completely and correctly because you refuse to do your job. Then you only have yourself to blame.

Giving them this info will take you less than 15 minutes. I suggest it be done and you retain the client.

Brad Ellis, IFA, RAA
 
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