Wells Fargo Appraisal Requirements

[larryhaskell]

I receive several opportunities a month to bid on assignments for Wells Fargo. Their requirements seem excessive to me when compared to other lending institutions. For those that complete work for WF, how do you view their requirements when compared to other lenders. Any other comments regarding WF pro or con would be appreciated.

 

[Lobo Fan]

I do quite a bit of stagecoach work but all through RELS. They are fairly low maintenance compared to the others. They have only come back at me once with something totally stupid. I got a letter stating that I had to put the lot dimensions on each appraisal. If a survey is not provided, then there is no way to access that data other than to measure the lot myself. I don't want that liability, out looking for landmarks and such.

I have been seeing more value reconsiderations lately but I attribute that to a tighter market.

 

[Vernon Martin]

I've done 8 commercial appraisals for them in the last 14 months. Their appraisal review system is decentralized and the strictness of the requirements depends upon the individual review appraiser that you're dealing with. Nevertheless, all the extra requirements made me raise my fees to the point where my bids were no longer competitive. Case in point -- they require comparable sale verification with either the seller or the buyer, but nowadays so many buyers and sellers are LLCs. If you're lucky you can find the names of the principals from the Department of State. Another case in point - they require adjustment grids for rent comps, even for self storage properties. I don't bid on WF jobs any more.

I've also seen WF hire the best and brightest to be their review appraisers, and then compromise their effectiveness with pressure from the loan side.
Apparently there is hell to pay for appraisals that miss purchase prices, but I've seen a lot of purchase contracts that aren't at market value. Example --purchase last year of several office condos in north Phoenix area for $275 psf by naive out-of-state widow being steered by a clever broker, in a market where the comps were selling at $170 to $220 psf and office condos were being built at every major corner. I was criticized for missing the purchase price. I was back on the same street two weeks ago, and now new, unsold vacant condos are selling for $56 to $90 psf. Likewise in Ventura, CA, in the poor part of town, a developer (perhaps a good campaign contributor?) who was unable to presell condos was able to get the city to buy the land for $80 psf. Comps from the immediate neighborhood, even across the street, established land value in the $35 to $40 psf range, but the review appraiser asked me twice to consider land comps from the better parts of town, at $80 to $100 psf. He had to have been pressured. He also asked me to assign value to condo entitlements in a fast-tracked redevelopment area where entitlements and permits are typically obtained in 6 months.

Vernon Martin

 

[PL1957]

I receive several opportunities a month to bid on assignments for Wells Fargo. Their requirements seem excessive to me when compared to other lending institutions. For those that complete work for WF, how do you view their requirements when compared to other lenders. Any other comments regarding WF pro or con would be appreciated.

We've done a lot of work for Wells Fargo. Their requirements are really nothing different that those from most major lenders. Every major client has their unique features, but all of the big boys (JP Chase, B of A, Wachovia, ABN/AMRO, etc.) pretty much ask for the same stuff. The primary thing they ask for is a thorough, well-documented report, and fortunately, they're willing to pay for it.

On the review side, we haven't run in to any "idiot" reviewers who don't know what they're doing. All of the ones I've talked to have been experienced people who know both sides of the industry. Most of the off-the-wall questions are questions that they pass on from other parties.

They're a great client to have.

 

[Stephen J. Vertin MAI]

On the review side, we haven't run in to any "idiot" reviewers who don't know what they're doing. All of the ones I've talked to have been experienced people who know both sides of the industry. Most of the off-the-wall questions are questions that they pass on from other parties.

I fully agree

 

[Terrel L. Shields]

but the review appraiser asked me twice to consider land comps from the better parts of town,

Was he a review appraiser or acting as Underwriter?