VA liquidation appraisal questions

[OllieGarchy]

Hello. I've been given an "LGI-Liquidation" appraisal order by the VA.

I've never done one before. The instructions are simple enough: make calls on three different days to schedule an appointment. If unable, turn it into a 2055.

So, whether it winds up being a 1004 or a 2055, what FORMS and/or comps and/or other information has to be included in the report?

Also, how do you determine a liquidation value in an appreciating market, with no REOs or short sales or "please just take this off my hands" sales? If everything is selling within 30 days, it would seem that liquidation value is pretty much the same as market value (arms-length).

Or is there a percentage discount that's applied?

Many thanks for any help you can provide.

 

[Terrel L. Shields]

If everything is selling within 30 days, it would seem that liquidation value is pretty much the same as market value (arms-length).

I would think that makes the job easier... and I am not a VA appraiser but I doubt there is a "set" percent. Just use the shortest DOM sales you have.

 

[DWiley]

Hello. I've been given an "LGI-Liquidation" appraisal order by the VA.

I've never done one before. The instructions are simple enough: make calls on three different days to schedule an appointment. If unable, turn it into a 2055.

So, whether it winds up being a 1004 or a 2055, what FORMS and/or comps and/or other information has to be included in the report?

Also, how do you determine a liquidation value in an appreciating market, with no REOs or short sales or "please just take this off my hands" sales? If everything is selling within 30 days, it would seem that liquidation value is pretty much the same as market value (arms-length).

Or is there a percentage discount that's applied?

Many thanks for any help you can provide.

Even though the VA does order what they call "Liquidation Appraisals," they ask that those appraisals report Market Value, not Liquidation Value.

Per their instructions:

The fee appraiser’s value estimate for all liquidation appraisals will be for the subject property in its “as is” condition. VA liquidation appraisals are prepared under the same definition of market value as origination appraisals, not a discounted or forced sale value. Consequently, a property which needs no repairs should appraise for the same value on a liquidation appraisal and an origination appraisal.

 

[OllieGarchy]

Just tried the owner's phone number. Was met by a carrier recording: “The number you dialed is not a working number.”

I contacted the lender and asked if she wanted me to continue calling for the next 3 days or to immediately go to a 2055.

Also, many thanks for the answers I've received so far. They're gonna make my job easier.

Finally, are there any additional forms or requirements in a Liquidation Appraisal (i.e., number of comps (sales and listings), a special addendum, any special verbiage, etc., apart from the 1004 or 2055 I'll be using?

Thanks.

 

[LarryJewell]

Show the borrower in the report as "N/A". Include the "Liquidation Appraisal Addendum" in the appraisal, this is form VA3 in Total software. This is where you document the 3 attempts for scheduling as well as include 3 competitive listings. Also, put your 3 attempts in the portal. The last one I did, I knocked on the door, three different days and took photos each time, on the 3rd attempt I did a 2055 Exterior.

 

[Zoe]

If you have foreclosure sales / listings that are best comparables. Use them

 

[Tim Hicks (Texas)]

Just tried the owner's phone number. Was met by a carrier recording: “The number you dialed is not a working number.”

I contacted the lender and asked if she wanted me to continue calling for the next 3 days or to immediately go to a 2055.

Also, many thanks for the answers I've received so far. They're gonna make my job easier.

Finally, are there any additional forms or requirements in a Liquidation Appraisal (i.e., number of comps (sales and listings), a special addendum, any special verbiage, etc., apart from the 1004 or 2055 I'll be using?

Thanks.

You should visit the property and knock on the door and leave a note. Document it in your report. Also, if you realized the home is vacant when you visit the property, you need to contact the lender for them get you interior access. LGI appraisals can be complicated when you have bad contact information, but you still have to knock on the door and should even leave a not to show the effort to gain access.

 

[OllieGarchy]

Hi. Here are the lender's instructions:
The property is occupied by the borrower, please reach out to the borrower for access to the property. If the borrower is unresponsive after three attempts on three different days, document your attempts, please convert the order to an Exterior Appraisal. Borrower Contact: (zzz) zzz-xxxx.

I took this to mean that I should CALL the borrower rather than go to the property. Or does the VA require me to actually go out to the property and knock on the door?

 

[Tim Hicks (Texas)]

Hi. Here are the lender's instructions:
The property is occupied by the borrower, please reach out to the borrower for access to the property. If the borrower is unresponsive after three attempts on three different days, document your attempts, please convert the order to an Exterior Appraisal. Borrower Contact: (zzz) zzz-xxxx.

I took this to mean that I should CALL the borrower rather than go to the property. Or does the VA require me to actually go out to the property and knock on the door?

If you know the phone is disconnected, are attempts #2 and #3 really attempts? They expect us to knock on the door here. You have to document your three attempts. I would suggest leaving a note if you can tell that someone lives there and they are just not answering. Do the Vet solid and make real attempts. Going through a foreclosure can be very stressful for the Vet. Sometimes, they are trying to do a loan modification, but the lender never stops the foreclosure process and they panic. Many times these homes are locked up tight, curtains closed and silent. Sometimes there are signs that the home is vacant (no utilities) and you are required to contact the lender to have them get you access or have the VA waive the interior access condition of the assignment.

If the phone is disconnected, I make the second attempt in person and leave a note. I do all the inspection for an exterior appraisal on that visit. Then I wait a couple of days and revisit the property. If still no response, I do the exterior appraisal. A few times, I have had the veteran call me after leaving a note. Mostly, I get no response and proceed, but I have supported that I made three legitimate attempts to gain access. Occasionally, I can tell the home is vacant. Then, it is up the lender to get it rekeyed for access for you.

 

[OllieGarchy]

Okay. The lender also gave me an email address which I used. So if I called today and email again tomorrow, that's 2 attempts. Then when I go out and do my 2055 I'll make a 3rd attempt and, if he's home, I'll do the 1004. If not, like you said, I'm already there for the 2055.