VA Appraisal SFR with ADU

[Alpine]

The VA RLC obviously sets the area fees for SFR, duplex, manufactured, condo, etc., but there is scope on occasion for requesting a fee increase for unique and complex properties, and I've done that on a few occasions over the years. My question is whether an ADU that is atypical of the neighborhood justifies a request to the lender for a fee increase. In this case, the primary subject dwelling is a 1,400sf 1960s ranch on a half acre suburban lot, but the ADU is brand new, architecturally designed, about 800sf, 2-bedroom/1-bath with substantial material upgrades. It's not typical of the few ADUs in the greater neighborhood, which are generally smaller and more generic in design and quality. This one is detached from the dwelling, and not separately metered, so it doesn't qualify as a duplex, and it was constructed for extended family usage, not rental or Airbnb. Appraisal will be completed on a URAR/1004, but the amount of work associated with the ADU is substantial. In your experience, is a request for fee increase justified? Thanks in advance for response...

 

[Zoe]

I would try. Talk to lender. Veteran will have to agree. Most times veterans know when the property is complex when they are getting a loan for (refi or purchase)? Veteran will probably agree if lender requests it to the veteran. Contact your POC.

Brand new. I would want cost of construction from veteran or lender. I would dig and probably try to see veterans motives that are relative.

I am thinking out loud. What will it be used for? Home business, etc.etc.etc.

 

[Tim Hicks (Texas)]

Why does the age of the ADU matter? It is still not the main dwelling. Its contributory value should only be what a typical ADU brings. Does a new pool bring more value than a 20 year old pool? How about a 20 year old workshop versus a new workshop? If you can get a higher fee, go for it. if you can do it for the standard fee, then go for it.

 

[Zoe]

I have been doing VA a long time. I have only requested fee increase a handful of times. It was always accepted by lender. It was like 4,000 sq ft house on 10 acres or something. I think VA duplex fee locally is $900. Ask for $900 but your assignment will be easier than a duplex.

I just eat the good with the bad on fee most times. Don't get me wrong. I would charge $1,000 to $1,500 on many assignments if I were not doing it for VA. Many appraisers don't like working for VA because the fees are hard to move.

The lender can handle a fee increase with the veteran. I have probably only asked 3 times for fee increase to lender.

 

[Zoe]

Many veterans are rich. Some active, some inactive and pursued other careers. Many veterans are rich. Many veterans are lower income and disabled. The appraisal fee is so low on totem pole to them that it is not that important. On your assignment, I probably would not ask for fee increase. That's me. VA is not hard to please on good comps. You can adjust for it being new. I don't know VA fee is in your area. I would not worry about unadjusted sales prices bracketing appraised value if you can't bracket it.

 

[Zoe]

Whoever built it knows what it cost them to build it. I would want that. I would be adamant and I would want to know what it will be used for.