Would Adding A 1004mc To A Completed Appraisal Comply With USPAP?

[glenn walker]

Its not a new assignment just do it and be done

 

[CANative]

I don't understand why people are so resistant to the MC addendum. It's a nifty little tool that can be used for more than just the first stab at what is within a block of two of a subject. If an appraiser is kind of week on excel tools or their MLS has a trend or statistics feature that is complicated are is a pain in the neck to use, the MC can gather and sort the data in seconds. Data from less than a mile, data for the entire city or even county, etc, etc.

Run all and you can get a really good picture of market trends. These can be compared to the results of cost and income approaches. It's not all 3 comps and off to the cornfield.

 

[Mr Rex]

And you can skew the input to make it sing the song you want it to sing. The most obvious fault and likely why its been dismissed as required is that it's "reflection" of the market SUCKS when its improving and there is limited inventory as it is NOW in many markets. A useful tool is a pair of pliers in any tool box. Need to remove a hard to move nut or bolt to get down to the work at hand, requires more tools than pliers. MC is and was a set of worn out pliers.

 

[Have Laser-Will Travel]

I don;t see why expanding a SOW makes a new assignment, when client is the same inspection date/ effective date has not changed, nothing about the subject has changed, your value has not changed

. Ok, it was not in your original SOW- client asked you to provide additional support. Similar to an ROV client asks to consider additional comps, that was not in our original SOW either. do what you want but I fail to see how adding an MC form creates a new assignment.

Imagine that the original analysis of the market did not rely only on comparable properties, as the 1004MC does, but was more general in order to obtain enough sales data. Then the 1004MC is completed, which ultimately leads to the discovery that homes in subject age range are declining in value although the original analysis was based on the trend of whole market increasing. The appraiser can't then add the 1004MC and dismiss the new findings because that would be misleading. The appraiser is left to re-evaluate the impact of the new information and rework the report.

The same would be true for ROVs, unless I am just being asked why the info was included in the scope of work or why it was but, wasn't influential. But if its new info, its always going to have the potential of having impact. Remember comp checks and readdressing reports? Clients wanted those too but they turned out to be non-compliant.

 

[Terrel L. Shields]

Since it is outside the scope of the original report I would add it, show as revised, and show that I have previously appraised the property and this is an addendum requested by the client and send a bill for $50...I don't care if the bill is $5, but the SOB is going to know its their fault not mine and if they don't pay, in the future I won't play the game...I'll bid an extra couple hundred.

 

[Mr Rex]

Imagine that the original analysis of the market did not rely only on comparable properties, as the 1004MC does, but was more general in order to obtain enough sales data. Then the 1004MC is completed, which ultimately leads to the discovery that homes in subject age range are declining in value although the original analysis was based on the trend of whole market increasing. The appraiser can't then add the 1004MC and dismiss the new findings because that would be misleading. The appraiser is left to re-evaluate the impact of the new information and rework the report.

The same would be true for ROVs, unless I am just being asked why the info was included in the scope of work or why it was but, wasn't influential. But if its new info, its always going to have the potential of having impact. Remember comp checks and readdressing reports? Clients wanted those too but they turned out to be non-compliant.

Got narrative to explain the MC results? It seems you are looking for a reason to charge for the MC requested after the fact and that may be a reasonable request. Otherwise, a whole lot of drama over a simple request. So charge for your time and treat it as a new assignment. You didn't just re-invent the wheel. WTF?

 

[Michigan CG]

Market analysis is not a change in SOW.

 

[Terrel L. Shields]

Market analysis is not a change in SOW.

IF the report complies with the SOW, then requesting additional FORMS is outside the SOW. SOW is the decision of the APPRAISER, not the client....even if the client demands certain things. You have to agree to it, and they agreed to it, and they wanted more...

 

[J Grant]

Imagine that the original analysis of the market did not rely only on comparable properties, as the 1004MC does, but was more general in order to obtain enough sales data. Then the 1004MC is completed, which ultimately leads to the discovery that homes in subject age range are declining in value although the original analysis was based on the trend of whole market increasing. The appraiser can't then add the 1004MC and dismiss the new findings because that would be misleading. The appraiser is left to re-evaluate the impact of the new information and rework the report.

The same would be true for ROVs, unless I am just being asked why the info was included in the scope of work or why it was but, wasn't influential. But if its new info, its always going to have the potential of having impact. Remember comp checks and readdressing reports? Clients wanted those too but they turned out to be non-compliant.

RE fannie guidelines , whether we use MC form or not, is to base neighborhood trends on the COMPS FOR THE SUBJECT, not the general market or on non relevant sales . I personally always did this, it is not just about fannie compliance, it is about credible results.

You sound like you realize your original appraisal might be misleading -If in order to get enough sales data, you ignored trends for comps for your subject, and now find out they show declining. Why was that not seen first time-- did you look at relevant listings?

. Now you are in a mess and have a tough choice, stick with your original trend of increasing but you know it is misleading ,or change it to declining per the MC form which might change your value
Changing our own value due to a better analysis does not mean it needs a new assignment btw though you can create one.

How confident are you in the MC form results ? What is the difference in value if you removed increasing time adjustments (if you made them, or applied trend from the MC form?

PS I am with CanNative on this I use the MC form because it addresses the comps particular to the subject, plus many clients still want it . WE can supplement the MC form of course with additional wider or generic market results if we want to. .

 

[Mr Rex]

IF the report complies with the SOW, then requesting additional FORMS is outside the SOW. SOW is the decision of the APPRAISER, not the client....even if the client demands certain things. You have to agree to it, and they agreed to it, and they wanted more...

And the OP could have met the "new assignment" requests of the client in less time than posting here. A simple "added fee" reply to the client over the change in original agreement could result in added fee, removal of the request, or potential loss of client/future business. Business decisions, business decisions... I'd rather die on a mountain than an ant hill, but avoid fire ant hills at all costs.