What Form Can I Use

[jeff samolinski]

I have a small older home with attached small rental unit. Can I use the 1004 form with income approach provided or do I have to use the 2-4 form. Assume 2nd unit is legal. Use of appraisal is for marketing for sale so no Fannie mae stuff required. Trying to save old lady in nursing home some money but don't know if ok to do on 1004 form. Hopefully you have all needed info. Thanks for your help

 

[John Wilson]

There are a lot of narrative fans out here. Sounds like you could put some thing together in a couple paragraphs that would do the trick. Or, try the back of a bar napkin.

Just right 250k and drop it off in the mail box.

 

[Kathy in FL]

Is the rental always a rental? Could it be considered a guest house? A mother in law suite? (A rental by any other name fits on the 1004.... )

Kathy in FL

 

[jeff samolinski]

Hey John.. Thanks for the help!

 

[Dave Smith]

1004 and explain!

 

[Pamela Crowley (Florida)]

IMO, I think this would depend on what you consider the H&BU of the property. Would most buyers of a property like that use it for income? If so, the income approach might be the 'best' approach to value and would be necessary. If you think most buyers would be interested in living there and putting a relative in the 2nd unit or that 2nd unit would bring a minimum of income, then I would think the sales comparison would be most appropriate and a limited w/departure could be done with no problem.

 

[Mike Garrett RAA]

Why not ask the client what they need? I have done them both ways...URAR or small income. If you do the URAR they most likely will want the income and expense analysis and comp rent schedule. Charge accordingly.

 

[jeff samolinski]

Thanks everybody!!!!

I forgot to say that there is an interested buyer that is an appraiser so I want to be careful. Mike, the client is going to be the current owner who is in a nursing home but I am working with her friend who has power of attorney and is acting on her behalf. I plan on doing a thorough income approach but I don't think I need to go through a 2-4 form since client just wants to know what to sell it for and won't understand it anyway. Not that a lender understands anything but the pictures and the estimated value either!!!

 

[Mountain Man]

Not that a lender understands anything but the pictures and the estimated value either!!!

:rofl:

If you are more interested in doing a really good income approach, maybe the best thing to do is a limited-restricted, in a short narrative. Qualitative market approach (superior or inferior, no adjustments), and the income on a spread sheet. Gives the client what they need, and will limit the call backs from sleazy XYZ Mortgage for a "re-print".