What form? 1004 REO

[residentialguy]

Well, Res, Grand, and Eli,

You all got it wrong, as did I. A 1004 REO, is a 2005 Supplemental REO, but the twist is to put the 3 listings as Comps 4-6 on a 1004. Oh, and the MC isn't permitted. Of course, they don't tell you that until you submit them. And they require ENV, but they ask you to upload XML.

Great, let's make it REAL misleading m2:

Are you going to actually do that????

 

[Mile High Trout]

We are required to have communication so that we provided a meaning report. The intended use of the URAR form "is for the lender/client to evaluate the property that is the subject of this appraisal for a mortgage finance transaction."

This is not the intended use, though. there is no borrower...no financing...yet we use it!!!

Hello....we have a problem.

Yep, and that's how you can learn quite a bit about the process at hand with the order distributor.

If they ask for the 1 page comparative listings w/ 90 day value deal (4 total values REO page, as is, as repaired, with time term), that's when you know you've got a doozy.

The best ones are the 1004 standard for price guidance, no xml or env.

If you're getting hit with xml or env requirement, it's highly likely the REO appraisal may be used for mortgage financing if possible for them to do so, or also possibly used for some comparative forensic review or put back action.

Never done an REO off form, that would be a nice treat, maybe.

 

[residentialguy]

How can you have market value with a limited market time???

just another problem.

They're looking for liquidation value, not market value.

Just did one for US Bank. put it on a liquidation form. Of course they wanted it to go thru AI Ready, which is wasn't compatible with. Finally took a pdf. You could attach to a blank 2055 or 1004, but seriously???

 

[Mr Rex]

Liquidation value is a sub set of market value, or a market value with additional parameters, but it is still a market value. There is more than one definition of market value, thus the reason USPAP requires the appraiser to state the applicable definition of value used in each assignment. Perhaps you should read the definition of market value in the definitions section of USPAP.

 

[Mile High Trout]

Conveniently, I have not had to deal with that in years.

Exposure time in Colorado for discount offerings, or even full boat offerings of crummy properties which don't drive as high of price, is 0-3 days, not 0-3 months.

The margins for fix and flippers is getting slim.

Luckily for them, old corporate uncle tom sam stepped in and kept the rates low to promote increasing pricing.

Bubble; will have to pop eventually. Artificial rates to pump artificial pricing, in a very real property market. Profiteers will keep on profiting, at the expense of the average joe. But they're a bunch of animals anyways, who drive away their own profit margins, competing on increasingly rare buys for potential flips. And now with corporate investors sucking up properties over market, on pure speculation, probably just a sliver over short term consideration.

On a more positive note, the home across the street just rented for a 1.75 multiplier compared to my monthly mortgage. It's like wow, perhaps we should rent this puppy out. Geesh! The only challenge is where to buy discount again for another one? Have to get outside of this entire 6 county MLS system though. The jig is up the game is over. If it comes up in Denver MLS systems, it gets reviewed by 10 dozen flippers before you even wake up. By the time your buyers agent gets there, they've already offered. Those flippers are buying sight unseen, if they think there is an available margin. It's fierce out here, which means the market most certainly will either turn into an out of control CA style market, or hopefully, will crash and burn all over again. Coloradoans are not as friendly as they say in the news, so don't believe the hype. I'd rather see all the out of staters crash and burn, and move some where else. It's painful to keep on appraising never ending upward valuation markets. If they loved what Colorado had to offer, the out of staters are certainly screwing it up big time, one higher priced deal at a time.

 

[residentialguy]

Liquidation value is a sub set of market value, or a market value with additional parameters, but it is still a market value. There is more than one definition of market value, thus the reason USPAP requires the appraiser to state the applicable definition of value used in each assignment. Perhaps you should read the definition of market value in the definitions section of USPAP.

But "Market Value" is a type of value with it's own conditions that is not mixed up with it's subsets. And the supplemental REO is an extension of the 1004, which is clearly not liquidation value.

People wonder why REOs sit on the market so long. Hello...it's priced was based upon the appraiser's opinion of MV!

 

[Mr Rex]

But "Market Value" is a type of value with it's own conditions that is not mixed up with it's subsets. And the supplemental REO is an extension of the 1004, which is clearly not liquidation value.

People wonder why REOs sit on the market so long. Hello...it's priced was based upon the appraiser's opinion of MV!

Its based on an abbreviated exposure time, a perfectly acceptable parameter to the particular value required in REO assignments.

 

[J Grant]

In my area, REO's typically sell faster than non REO's. In present market with diminishing REO inventory, they tend to sell similar range as a comparable non REO owned property, assuming equivalent condition.

 

[J Grant]

Liquidation value is a form of market value. And market value can have a limited time frame as part of its component.

Liquidation value has a conditon besides sprecific X days of time frame, the definition states it has a very limited marketing effort, and most lender owned REO assume open market effort of MLS , even with a specfici shortened client imposed time frame. Thus for most assignments the limited time frame is not liquidation value since most lender owned REO's (for MV purpose appraisals ) are listed on MLS and exposed to open market.sa

 

[residentialguy]

Liquidation still gives you wiggle room, as it does not state a concrete market time. Market value of the 1004 and supplemental that is locked to it is not appropriate value term to use
The term liquidation value is defined in The Dictionary of Real Estate Appraisal, Fifth Edition as follows:

The most probable price that a specified interest in real estate property is likely to bring under all of the following conditions:
1. Consummation of a sale within a short time period.
2. The property is subjected to market conditions prevailing as of the date of valuation.
3. Both the buyer and the seller are acting prudently and knowledgeably.
4. The seller is under extreme compulsion to sell.
5. The buyer is typically motivated.
6. Both parties are acting in what they consider their best interests.
7. A normal marketing effort is not possible due to the brief exposure time.
8. Payment will be made in cash in U.S. dollars or in terms of financial arrangements comparable thereto.
9. The price represents the normal consideration for the property sold, unaffected by special or creative financing concessions granted by
anyone associated with the sale