• Welcome to AppraisersForum.com, the premier online  community for the discussion of real estate appraisal. Register a free account to be able to post and unlock additional forums and features.

update on appraisal

Status
Not open for further replies.

Christine Marie

Senior Member
Joined
Jan 6, 2003
Professional Status
Certified Residential Appraiser
State
Mississippi
please assure me that i am correct in my thinking, a customer called today and said his banker needed an update on his (previous) appraisal. Sounding too simple, I asked the question, "when was the appraisal done?" To which, he replies July 19, 2000. I told him it was out of date and could not be updated, indicating additionally, that the market "may" have appreciated/or not, which would necessitate a need for a new appraisal. Someone please elaborate on "when an update is appropriate", just for my own piece of mind, please. Thanks, :roll:
 

Lee SW IL

Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Illinois
I don't update, I don't change the name on the report for a "new" client.

All assignments come in are new orders.

However, I may reduce the fee. Since you know the house, style, size, site size, ect you could reduce your fee as a good gesture, but its not a requirement. If you charged $300 2 1/2 years ago, and the home owner didn't change the home (additions ect) I may give $25 +- break, just cause Im a nice guy. :wink:

If I appraised the property 3 months ago, and the market hasn't changed much, I may give $100 break
 

Jo Ann Meyer Stratton

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arizona
I agree with Lee, there is no specific time frame for an "update", it is always dependant on the market in the specific subject's location. In some markets, updating would not be appropriate within a month--in a different market, updating might be feasible up to a year or more. The only time frame that has to be specifically followed is Fannie Mae's Section 201, if the original effective date is more than four months ago, Fannie Mae wants an update. But then Advisory Opinion 3 of USPAP says an update is a new assignment of a prior report with three reporting options. Whatever is done it is a new assignment, a new appraisal and a new report. How you report it is up to you and the client. And the fee charged is up to you. If the client doesn't like your fee they can either pay it or go to somebody else. Check out the messages on the General Forum with the heading of "New construction thats 1-2 months from completion".
 

Richard Carlsen

Elite Member
Joined
Jan 15, 2002
Professional Status
Licensed Appraiser
State
Michigan
Christine;

You can do an Update of an appraisal completed in 2000 as long as it is for the original client. There is no regulation that I know of that says you cannot. There may be some UW rules but from the appraiser’s side, I think you can do it.

However, you have a business decision to make as to what to charge for the update. Consider a report that is, say 5 months old. Most likely not too much will have happened to change the market. Some of the comps will be replaced with newer sales. There will be green grass in stead of snow on the subject's lawn so you won't be able to see the landscaping in the photos. In other words, not much change.

To update an appraisal from July 2000 to this date, you have many significant factors to consider: The economic downturn, the economic effects of 9/11/01, changes in buyer attitudes, changes in the condition of the property, all new comparable sales and the continuing decline in interest rates to name but a few. What you are really looking at is a whole new consideration of the market and its impact on subject's value. The new date requested automatically makes it a new assignment per USPAP. This is, in essence, a whole new report.

In addition, you are going to be giving a whole new opinion of value. This is not an extension of the liability you incurred in the first appraisal. It is a whole new responsibility since this is a new assignment.

The business decision you have to make is what to charge for the work and the liability involved. In my way of thinking, this is tantamount to a whole new appraisal and should be charged accordingly.
 

Restrain

Elite Member
Joined
Jan 22, 2002
Professional Status
Certified General Appraiser
State
Florida
I try to keep "updates" to no more than 6-9 months due to fluxuations in the market. Beyond that, it's a whole new ball game, especially if there have been recently announced layoffs, etc.. I saw a 10-20% loss in 3 months following 9/11, especially in subdivisions with new home builders in the market. Updates were not done because of the changing market and in some areas, I still don't do them.

Roger
 
Status
Not open for further replies.
Find a Real Estate Appraiser - Enter Zip Code

Copyright © 2000-, AppraisersForum.com, All Rights Reserved
AppraisersForum.com is proudly hosted by the folks at
AppraiserSites.com
Top

AdBlock Detected

We get it, advertisements are annoying!

Sure, ad-blocking software does a great job at blocking ads, but it also blocks useful features of our website. For the best site experience please disable your AdBlocker.

I've Disabled AdBlock
No Thanks