What's the difference between a C5 and C6?

[chad hampton]

Doesn't matter which you call it, you will get a call back saying it needs to be a C4 or they can't do the loan

 

[Pam Wyant]

I still favor condition descriptors that provide more detail, such as in Marshall Valuation Service's Residential Cost Handbook.

Aren't those quality descriptors rather than condition descriptors? Or have I been overlooking something in my book?

 

[Elliott]

Peter gets the award for best reply of the year! Tip of the hat!

I would have accepted the answer: 1=C6-C5

 

[Peter LeQuire]

Aren't those quality descriptors rather than condition descriptors? Or have I been overlooking something in my book?

Condition descriptions are in the depreciation section of the RCH. M&S's quality descriptors are - IMO - far superior to Aunt Fannie's, as well.

 

[Pam Wyant]

Condition descriptions are in the depreciation section of the RCH. M&S's quality descriptors are - IMO - far superior to Aunt Fannie's, as well.

Thank you, Peter. I have seen the depreciation tables, but managed to overlook the condition rating indicators. Having now taken a look at them, I agree with you totally!

 

[DMZwerg]

If you are asking yourself whether or not dynamite, a bulldozer, or donation to a fire dept for burning practice would be the best use for the property then it is likely a solid C6

 

[residentialguy]

not according to the definition of C6. a missing handrail on new constructions is not deferred maintenance, it's incomplete construction. you have to use the whole definition, not just the bits and pieces that you want to.

Rich is correct. Per FNMA
"the C6 rating is an exception because it indicates that the property is impacted by one or more deficiencies that negatively affect the safety, soundness, or structural integrity of the property. As a result, if any portion of the dwelling is rated a C6, the whole dwelling must be rated a C6."
"Physical Deficiencies That Affect Safety, Soundness, or Structural Integrity of the Subject Property
The appraisal report must identify and describe physical deficiencies that could affect a property’s safety, soundness, or structural integrity. If the appraiser has identified any of these deficiencies, the property must be appraised subject to completion of the specific repairs or alterations. In these instances, the property condition and quality ratings must reflect the condition and quality of the property based on the hypothetical condition that the repairs or alterations have been completed."
https://www.fanniemae.com/content/guide/selling/b4/1.3/06.html

So you never put "C6" as the condition on the report because C6 is subject to repair and your report must reflect the as-repaired condition, just like new construction. However, you still explain it in condition area so that it is understood: ie The report reflects C1 condition, however upon inspection, the handrail was missing, thus is considered C6 and subject to repair.

Same goes with the area where it asks are there any physical deficiencies or adverse condtions that affect liv, sound,or struct integrity...you would mark "NO" but explain it in the comments, ie "Upon inspection, adverse conditions were found that affected livability, noted above. "NO" was selected because this report is based upon the hypothetical condition that these conditions have been repaired."

 

[J Grant]

Some clients instruct to stop order if found to be a C6 and call them. Perhaps at that point they want to decide whether to make subject to repair , maybe they call homeowner to see if they are on board with making the repairs?

 

[residentialguy]

Some clients instruct to stop order if found to be a C6 and call them. Perhaps at that point they want to decide whether to make subject to repair , maybe they call homeowner to see if they are on board with making the repairs?

Extra charge for that pleasure, too And my policy is: once inspected, full fee applies.

 

[Ms. Janet]

Per FNMA
"the C6 rating is an exception because it indicates that the property is impacted by one or more deficiencies that negatively affect the safety, soundness, or structural integrity of the property. As a result, if any portion of the dwelling is rated a C6, the whole dwelling must be rated a C6."
"Physical Deficiencies That Affect Safety, Soundness, or Structural Integrity of the Subject Property
The appraisal report must identify and describe physical deficiencies that could affect a property’s safety, soundness, or structural integrity. If the appraiser has identified any of these deficiencies, the property must be appraised subject to completion of the specific repairs or alterations. In these instances, the property condition and quality ratings must reflect the condition and quality of the property based on the hypothetical condition that the repairs or alterations have been completed."
https://www.fanniemae.com/content/guide/selling/b4/1.3/06.html

So you never put "C6" as the condition on the report because C6 is subject to repair and your report must reflect the as-repaired condition, just like new construction. However, you still explain it in condition area so that it is understood: ie The report reflects C1 condition, however upon inspection, the handrail was missing, thus is considered C6 and subject to repair.

Same goes with the area where it asks are there any physical deficiencies or adverse condtions that affect liv, sound,or struct integrity...you would mark "NO" but explain it in the comments, ie "Upon inspection, adverse conditions were found that affected livability, noted above. "NO" was selected because this report is based upon the hypothetical condition that these conditions have been repaired."

Great explanation Res!