What would you do?

[Edward OConor]

I received this today.

"Then appraiser will need to do this report on 1004 as single family and comment that it has an illegal kitchen basement .(or do report subject to removal of 2nd kitchen .....whichever way he feels it should be done )
I have placed a new 1004 order for this , (order that was originally placed as a two family). The bold is for clarification.

This is a refi.

I am curious as to the over all consensus.

I pretty much know how I plan to handle it, but I was wondering how others might.

Would you become the the building department police or would you just inform the lender and let them make the decision?

 

[Darrel Clark]

That depends on what action the city would take if it was brought to their attention that there is an illegal kitchen. Would they require that it be removed, inspected and permitted or don't they even care?

 

[Edward OConor]

That depends on what action the city would take if it was brought to their attention that there is an illegal kitchen. Would they require that it be removed, inspected and permitted or don't they even care?

The building department in the subject's area is in turmoil. They have had a don't ask policy (they are not proactive). If neighbor complains they will act, if a precious tenant complains is is pretty much ignored.

 

[Darrel Clark]

First option would be to have the owner get with the city and obtain a permit.

If that was not an viable option, I would do the report "as-is", but not give any value to the basement kitchen. I would not deduct for the possible cost of removing the kitchen. I would make sure to note conspicuously in the report that the kitchen is illegal.
.

 

[Artemis Fowl]

...Would you become the the building department police or would you just inform the lender and let them make the decision?

No to the 1st. Yes to the 2nd.

How about comps with illegal kitchens in the basement?
There are areas in my market where this is common and very much in demand from certain market participants...legal or not.

 

[robert higgins]

Q1) Was the first original order canceled and replaced with the 1004 order? If not, how did you do the first one?

Q2) If this is a second order, original appraisal done and delivered, If so, how did you do the first one?
I would not touch the second one with a 10 foot pole.

Q3) If the first order was canceled, and this second one ordered, I would not touch it with a 10 foot pole, as it is an unacceptable appraisal order and I would not want to take on the liability of it.

 

[Eli Weiss]

Q1) Was the first original order canceled and replaced with the 1004 order? If not, how did you do the first one?

Q2) If this is a second order, original appraisal done and delivered, If so, how did you do the first one?
I would not touch the second one with a 10 foot pole.

Q3) If the first order was canceled, and this second one ordered, I would not touch it with a 10 foot pole, as it is an unacceptable appraisal order and I would not want to take on the liability of it.

Can you a bit more specific, as to why you will not touch it with a 10 foot pole?

 

[The Warrior Monk]

I received this today.

"Then appraiser will need to do this report on 1004 as single family and comment that it has an illegal kitchen basement .(or do report subject to removal of 2nd kitchen .....whichever way he feels it should be done )
I have placed a new 1004 order for this , (order that was originally placed as a two family). The bold is for clarification.

The client shouldn't be presenting various scenarios and then leave it up to the appraiser to guess which one they want. Each scenario has different implications for then lender; only they know what they need.

With that said, the starting point is always "as is." There has to be a compelling reason to appraiser the property under a hypothetical condition (subject to).

Would you become the the building department police or would you just inform the lender and let them make the decision?

The appraiser should always report the facts. The appraiser is required to state the current use of the property.

 

[Mr Rex]

First option would be to have the owner get with the city and obtain a permit.

If that was not an viable option, I would do the report "as-is", but not give any value to the basement kitchen. I would not deduct for the possible cost of removing the kitchen. I would make sure to note conspicuously in the report that the kitchen is illegal.
.

Mind showing your work that got this to "As-Is"?

 

[Edward OConor]

Q1) Was the first original order canceled and replaced with the 1004 order? If not, how did you do the first one?

Q2) If this is a second order, original appraisal done and delivered, If so, how did you do the first one?
I would not touch the second one with a 10 foot pole.

Q3) If the first order was canceled, and this second one ordered, I would not touch it with a 10 foot pole, as it is an unacceptable appraisal order and I would not want to take on the liability of it.

The first order was for a 1025.

I inspected the property and informed the lender of the illegal kitchen. They then canceled the 1025 order and replaced it with a new order # for a 1004 due to the different fee schedule.