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Value Reconsideration?

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Doug

Thread Starter
Freshman Member
Joined
Feb 21, 2002
I appraised a home in Dec.2001. Just got a "reconsideration of value" request , due to subject's neighbor's home sold a month later, higher than my appraised value. Since the appraisal , i have left the company i was appraising for. Should i refer it to the company i worked for?
 
Joined
Jan 13, 2002
Professional Status
Retired Appraiser
State
Florida
Did any other appraiser from the other company you used to work for go with you and help you complete this it? If not, the previous company would have to do a new appraisal so.... do a new one yourself with a nice discount for your new client.
 

Lee in L.A.

Elite Member
Joined
Jan 24, 2002
Professional Status
Certified Residential Appraiser
State
California
Two thoughts. Would that comp support a higher value?
Even if it would, it closed a month later, so how relevant is that to the appraisal, made as of a specific date? Yeah, maybe a new appraisal...
 

jtrotta

Senior Member
Joined
Jan 16, 2002
Doug - just a thought :)

It's been a very short time frame since you left- be careful :?

Are you on your own now or with a new company :?:

It would require a new appraisal - sale closed after the fact :!:

Did you mention the property was "under contract" :?:
 

Doug

Thread Starter
Freshman Member
Joined
Feb 21, 2002
I am on my own now 8) . The new sale would support a higher value. New sale was not even listed at time of original appraisal. Would an update be unacceptable since new comp is after the fact?
 

bradellis

Member
Joined
Jan 16, 2002
Doug,

The AO on an update says the original appraiser/firm must be involved. Since you were the original appraiser (and I do NOT know if they mean BOTH the appraiser AND the firm, or EITHER). Way I read it is either.

So, if you agree, you may do the update and sin the update changes the effective date, subsequent information may be used.

Brad
 

Doug

Thread Starter
Freshman Member
Joined
Feb 21, 2002
How should i do the update? Since i have a new comp, and the value would change, should i do a drive by? Full?
 

Jo Ann Meyer Stratton

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arizona
First the appraisal that you did while employed by another company belongs to that company, not you personnally, so you cannot do an update to an appraisal that is not your property.

Now as a new company you could do a completely new appraisal report of the subject report--although you should disclose you had personnaly appraised the property very recently while an employee of a different company, and the previous company should give you permission to do so. Keep every thing neat and tidy so nobody can get the wrong impression.

Finally, one sale does not indicate the market. Just because one sale was listed and sold since the previous date of opinion of value does not necessarily mean the market has changed! What about other similar properties have they increased in value? Is there a reason all homes in similar locations with similar amenities have a price increase. If everything was clear for you to do a completely new report, your one sale plus older sales might still indicate a similar value to the previous value.

The original appraisal report was completed while covered by the previous E & O insurance policy and any new action on your part is now a different E & O policy for a differant company. The lender needs to contact your previous company and either have one of their employees do an update to an appraisal as an extension of what you did or get in writing that the previous appraisal company releases the report to you and now you do a new report due to the covered under the new E & O insurance policy (by the way, check with your E & O insurance to see what action would or would not be covered).

At one time I worked in a large office and 18 of us quit in one month. This was a contining problem for six months afterwards. We could not do any action involving a previous appraisal report that had been done while employees of the old company. If we did anything for a property that had been appraised during the last few months with the old company there had to be major changes in either the subject or the market before completing a completely new appraisal report and all new research, etc. Their E & O Insurance Company had our new E & O Insurance company's phone number on their speed dial--waiting for somebody to trip. We didn't and no claims were filed with the new insurance company. It got very interesting at times trying to explain to a loan officer or processor whose previous job last week was at Burger King why we couldn't get involved in an old file.
 

Doug

Thread Starter
Freshman Member
Joined
Feb 21, 2002
I thank everyone for the great advice! I advised "quality assurance" that the original value was supported with best available comps, 1 new sale would only further support the original value. I advised then that i am no longer with old firm, and would not be able to make any changes.
 

Ray Ohler

Sophomore Member
Joined
Jan 15, 2002
Doug, I believe you made a wise decision. WHY? I'm going to TRY and keep this short. First off, you didn't give any particulars so maybe the value differential wasn't that much. Doesn't really matter. But, you COULD have run into a lot of forseeable problems if you changed the value. IF your effective date (original) was 12/01 and now your effective date was 2/02 AND there was a "sizeable" increase not supported by time alone you might have had a problem especially since your value increase was pinned on one sale (if you used the other two sales which you used in the original report - may have had to change the adjustments - other than time - BIG mistake). IF you replaced all three sales and made different adjustments NOT consistent with adjustments in the first report - ANOTHER BIG mistake. This could get crazy. Bottom line is, since you did the report while you were with another company IF that company found out you "re-appraised" the property for assumably the original client (other appraisal company's client) and someone got a bug...they would probably seriously consider reporting it to the state - BIG problems for not a whole lot of money (besides, the "client" would probably want a reduced fee which would make it even worse). There are a lot of things I didn't even touch on here because I'm trying to keep it concise. However, it is all a moot point. I think you made the best decision.
 
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