What do you think about this requirement?

[NC Appraising]

Thanks for your responses.

I think it was just poorly written.

My main beef was: financed=personal property.
Paid off now becomes not personal property?
I was not aware of such a law or appraisal theory on this.

So, when they are paid off, I can give it value?

Why not just say, "we do lend on solar panels, please use a hypothetical condition". ......kinda like USDA and inground pools, FHA and excess land.

 

[NC Appraising]

This has already been posted in another thread and debated. It is from the same company and on the same LOE as I posted already.


SOLAR. The order will indicate If the solar panels are being paid off at closing. Please incorporate the hypothetical condition Make report As Is, but include the following comment: A hypothetical condition that the repairs or alterations have been completed - that the panels will be paid off at closing. Note that if they are not paid off this could have a significant impact on the value opinion of the subject. Please include the solar panels in the value opinion of the subject. Please include a minimum of 1 comparable with solar panels. If one cannot be found detailed comments must be included addressing how it was determined if the panels add value or not

 

[shrubberyvaluation]

If the assignment is for MV, then it is the reactions of the market participants to this feature that we are trying to observe, report and emulate in our valuation. Not what the lenders as a group are doing or what this particular lender is doing. Lenders are not mentioned in the definition of MV. They can cut their LTV because they don't want to lend on the market's reaction to these attributes but they can't unilaterally dictate what the market participants do and don't value.

I kinda doubt they have completely thought the situation through.

I don't discuss how market participants react to personal property being left behind. Market participants can value a car you throw in with the sale too, doesn't mean I incorporate it in my appraisal.

 

[Tim Hicks (Texas)]

Thanks for your responses.

I think it was just poorly written.

My main beef was: financed=personal property.
Paid off now becomes not personal property?
I was not aware of such a law or appraisal theory on this.

So, when they are paid off, I can give it value?

Why not just say, "we do lend on solar panels, please use a hypothetical condition". ......kinda like USDA and inground pools, FHA and excess land.

If there is a separate loan, they can foreclose on the panels and repossess them without repossessing the house. No value, unless part of the mortgage or paid off makes sense.

 

[NC Appraising]

If there is a separate loan, they can foreclose on the panels and repossess them without repossessing the house. No value, unless part of the mortgage or paid off makes sense.

How about new windows that were purchased/financed through the contractor that installed the windows?
Same goes for the HVAC system that was financed via the municipal GOVCO?

I have never asked if the windows or HVAC were paid off? What, the windows and HVAC are personal property until they are paid off?

 

[NC Appraising]

I don't discuss how market participants react to personal property being left behind. Market participants can value a car you throw in with the sale too, doesn't mean I incorporate it in my appraisal.

My beef is not really if solar panels are personal property or not.

How do they magically go from being personal to not personal property depending on if they are paid off or are financed?
1. if they are financed, OK, the contractor can come and rip them off.
2. paid off, the owner can take them down the next day.
what is the difference? I

It is either personal property or not personal property.

It does not matter if they are financed or paid off. That should not have anything to do with it from an appraiser's perspective.

 

[TerryRohrer]

My beef is not really if solar panels are personal property or not.

How do they magically go from being personal to not personal property depending on if they are paid off or are financed?
1. if they are financed, OK, the contractor can come and rip them off.
2. paid off, the owner can take them down the next day.
what is the difference? I

It is either personal property or not personal property.

It does not matter if they are financed or paid off. That should not have anything to do with it from an appraiser's perspective.

If paid off and attached to the real estate, and depending on the definition of real estate in the jurisdiction, it would likely be real estate. But the financing mechanism noted above changes that. It legally becomes non-real estate. The appraiser's perspective is to deal with the property rights involved. And these differences matter.

 

[Tim Hicks (Texas)]

How about new windows that were purchased/financed through the contractor that installed the windows?
Same goes for the HVAC system that was financed via the municipal GOVCO?

I have never asked if the windows or HVAC were paid off? What, the windows and HVAC are personal property until they are paid off?

Windows and HVAC not $60 grand and they don't take 20+ years to pay for them.

 

[Terrel L. Shields]

My main beef was: financed=personal property.
Paid off now becomes not personal property?

I agree. It is 'fixed' therefore, normally considered to be "real" property. It's being treated more like trade fixtures. Say a body shop has a frame straightener that is bolted down to the floor of the shop he owns. For the owner it is a fixture and therefore, "Real" property. But say the building was rented to a bodyman who installed a frame straightener bolted to the floor. The frame straightener remains the property of the renter and is a "trade fixture" - personal property.

 

[TerryRohrer]

Windows and HVAC not $60 grand and they don't take 20+ years to pay for them.

And who has ever seen a window financed and recorded through a UCC filing? And contractor financing is likely protected by mechanics lien and not subject to removal. I suppose the OP will now want to get into whether or not flooring financed with a credit card and installed by the homeowner needs a detailed analysis. Talk about erecting windmills with which to joust!