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Why won't the term "recert" just die?

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Tim Hicks (Texas)

Thread Starter
Elite Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Texas
I had a call from an investor from Californy today. They wanted to know why I would not give them what they wanted. I did an appraisal in May 2002 on a 50 year old home on 12 acres. "Oh, do the appraisal on 12 acres we have investors that will do the loan". That was three lenders ago. Now I get the request from Californy. "Please provide a recertification of value on the property and please change the appraisal to the house and five acres. All we need is a letter certifiying the appraisal is good and your comps were good. We don't need new comps just a new effective date. Oh, we are trying to close today or Monday."

Well, they got a letter alright. No, I can not just give them a letter and change my value to the house and five acres. I can provide an appraisal update, re-inspect the property and get current sales if there are any available that are more similar with regard to lot size. This will cost them a new appraisal fee.

"Don't you have a recertification of value form like all the other appraisers? You can just change your market grid and cost approach to reflect five acres and change the effective date. That is what all the other appraisers do. I have never heard anybody question a recertication of value before. This should not require a new appraisal with new comps".

Yes, I know, I am the only appraiser in America that questions your instructions. I am the only one in America who wants to argue "recert vs update." But, don't you think the market is a little different for a house on five acres versus one on twelve acres? Don't you think that comps that aren't over ten acres would be more relevent? Don't you think that my comps from five months ago that were all over six months old might be a little ripe? Don't you think I know you are just going to sell the loan off to another investor that will not know about your instructions?


"Well, I guess we are at an empasse".


You got it. No recert. If you want a value with the house on five acres, order an appraisal from me or somebody else. I might cut you a discount, but only if it is pay at the door.

I need to work on my people skills again.
 

George Hatch

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Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
California
Tim,

It's not the term 'recertification' that is the problem, it's the misuse of the term. The reason the misuse of this term won't die is because there are some appraisers who, even after all these years, continue to use it incorrectly. If everyone used the right nomenclature, the clients would figure it out soon enough. Worse yet, there are appraisers out there who actually know better, but are ignoring it and doing it the old way simply because "The Customer is always right. The Client is king. Whatever they want is what they get".

If we can't get all our peers to use the term correctly, how can we expect our clients to know any better? All you can do is continue to be patient with them and 'educate' them as you go.

George Hatch
 

Jo Ann Meyer Stratton

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arizona
George: You just explained my purpose of offering to send templates for my "update to an Appraisal" letter. I definitely know it is not perfect but any appraiser or lender that receives a copy might start thinking. Also lenders are way behind on their own supplemental guidelines that still use the incorrect terms. So the loan office or processor or receptionist that is told to call the appraiser is quoting from an outdated guideline. And then the fun will really start after 01/01/03. That will really have us all confused. Since lenders are about 5-6 years behind the times, about the time they learn to use the term update correctly, new assignment referencing a previous assignment will be an outdate expression. I am still mulling over in my head how to write a letter that would be a "new assignment that references an older file". An Update to an Appraisal letter is a new assignment that references an older file but now the words update to an appraisal will no longer be used. You can formulate well structured sentences--any ideas???
 

Mountain Man

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Georgia
You can just change your market grid and cost approach to reflect five acres and change the effective date. That is what all the other appraisers do.

All right!! I am glad that I'm NOT the only one who gets that line. :wink:
 

BarbaraNJ

Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
New Jersey
Tim:

Have no arguement on the "recert" vs. "update" controversy.

Just wanted to tell you that from reading your response to the (new) lender, you are my "HERO FORUM POSTER OF THE MONTH"

Great Response !!!
 

Terrel L. Shields

Elite Member
Gold Supporting Member
Joined
May 2, 2002
Professional Status
Certified General Appraiser
State
Arkansas
because "The Customer is always right. The Client is king. Whatever they want is what they get".

This seems to be a mantra even among MAIs, some who argue we need to provide these services or someone else will figure out how to....so let 'em. It really gets down to the question of cost. If I am providing an Update (and often they boldly ask for it FREE no less) I need compensated a professional fee.....Buy title insurance.....sell in 6 mo. and see what they charge you...about 90% of the original fee as a "break." Wanna update? cough up my professional fee, say 90% of the regular one and we'll talk about it.
 

Mike Garrett RAA

Elite Member
Gold Supporting Member
Joined
Jan 14, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
The question is ..."why won't it die". It won't die until the lenders are required to attend a USPAP course in order to be licensed and or certified in every state.

Until then, we must inform them that we can't do a recertification because there is "no such thing as far as appraisers are concerned".

Educate, Educate, Educate! And be sure to charge accordingly!
 

Tim Hicks (Texas)

Thread Starter
Elite Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Texas
Quick update. Underwriter calls. Just change your adjustments on your original appraisal and give us a re-certification letter on your appraisal giving us a new effective date. No can do. I am not re-certifying a value that I never gave in the first place. I can do an appraisal update and give you new comps because of the lender induced drop in value. Fine, give us that. So, I do an exterior inspection, three new comps with 4-7 acres (instead of the original 12-14 acre comps), put in on a 2055 form with the verbage " This is an appraisal update of an original appraisal performed 5/22/2002 with a hypothetical 5 acres out of a 12.84 acre tract of land." and necessary addendums needed with an update. This seems to follow the FNMA guidelines regarding updates.


Nope, The underwriter calls the next day. We can not do this loan with a desk top appraisal.

I explain that the 2055 form and addenda are an extension of the original appraisal and are not stand alone documents.

She then explains that they will not allow the term "hypothetical" in the report.

I asked her if they were doing title work on 12.84 acres or 5.0 acres. 12.84 acres or course. Do you have a survey for 5.0 acres?

No.

Then it is a hypothetical 5.0 acres.

We can not allow you to word it that way.

Well, I guess we are at an empasse again.

Why can't you just re-certify the first appraisal like all the other appraisers do for us?

Oh, I can give you a letter properly changing the effective date of the appraisal of the home and 12.84 acres, but not one for the house and 5.0 acres, because that is not what I appraised.

When can you do a new full URAR appraisal for us for the house and 5.0 acres?

When I receive a check for all the work I have done so far and I have re-inspected the interior to do a new full appraisal like should have been ordered in the first place. I will expect full payment in advance.

Now, I have asked several appraisers how I should have handled this situation. No matter how you slice it, it was not worth the time and effort from me. Some appraisers say I should have just done what they asked. Some say I should have done the update on the URAR, but I did not want to mislead anybody about whether I inspected the interior this time and FNMA does not require it on an update. I have done updates on the 2055 form before with proper addenda. Some say, "house on 12.84 acres-one appraisal, house on 5.0 acres-new appraisal". However, when the lender barks they will accept an update, you would think they would accept it. I think I should have told them, "sorry, new appraisal", but I was trying to help solve their problem. This is why USPAP, FNMA and lender requirements will never be on the same page. they want it that way. All I can think of is the poor sap appraisers who just change their appraisals and let them get sold off to a different mortgage company who will have their own review department orlender requirements. Everytime a lender wants me to change an appraisal in some way it affects the appraisal process of that report and lessens its credibility.

By the way, I am now the appraiser who is keeping the borrower from getting his loan now. The borrower is calling me, the loan officer is calling me, the lender rep is calling me and the underwriter is calling me. And they have my cell number, too!
 

Blue1

Elite Member
Joined
Jan 14, 2002
Professional Status
Certified Residential Appraiser
State
California
I believe that Fannie Mae requires the appraiser to provide a map of the actual 5 acres being appraised. In other words, if the parcel is.....say.....10 acres, YOU (the appraiser) have to provide a map of the exact 5 acre portion (of the 10 acres) you are appraising. Ridiculous? Hypothetical? Certainly.......

As for the rest, I agree with George....educate them.
 
Joined
Jan 13, 2002
Professional Status
Retired Appraiser
State
Florida
Tim,

You tried to educate them. It's their own fault, not yours.

Regarding the cell phone, get a new cell phone number and don't give it to any clients. Very, very few have mine and will never get it. Sometimes I forward the biz phone to the cell and answer in the field, sometimes I just keep checking the voice mail and return the calls.
 
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