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Wow.. Latest Headache

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Patti Jury

Senior Member
Joined
Mar 23, 2002
Professional Status
Licensed Appraiser
State
Colorado
Here is a fun one to ponder...

39.77 Acres.. 4 mobiles on owned land

Purchased 4/1999 for $128+
The owner is updating the mobile and is seeking a refi/ cashout loan.
Owner had to go to the County (Yesterday) to Purge the Mobile they live in.
It is a 1980 "modular"
According to County records the only thing being assessed for tax purposes is vacant land and a 520Sf shed on a foundation.

Old appraisal "as per loan officer" gives a blank response to the foundation questions. Appraiser marks "N/A" on the manufactured question and never mentions the home is a mobile home. Now I know the confusing thing is mobile/modular issue.. but that is the MINOR issue of this problem.

Title comes back showing a shed, barn and vacant land.

So here are the questions:

Ready...

How does the original loan get funded if the owner/recent buyer is just now getting the property purged?
How does the property get insured if technically it still.. or up until yesterday... considered "personal property"?
Why did the appraiser ignore the foundation issues..not once but twice and also ignored the manufactured question?
And finally.. should I just walk away from this assignment? :rofl:
 

Travis McGee

Senior Member
Joined
Sep 18, 2004
Walk away. In my opinion, if it is not assessed as real property, it is considered personal property. You don't appraise personal property. I don't know why or if the appraiser ignored the foundation questions. My guess is that if any of the questions come back as "No", it would create problems. I can't tell you how many loan officers have asked to check off all the questions as "yes" and turn it in. When I have to check a question "No", like " has the tongue and wheels been removed?" Well, no they haven't, I often get a call with the loan officer arguing. They always say something like " you can't really see the tongue anyway." All of the arguing is always backed up by the statement " This deal is not going to fly unless this checklist is completed with everything checked off."

I had to do a final on a manufactured home a few years ago. They had pulled the home onto the land and left it. No foundation, no steps up to the door, no mechanical hook-ups, tongue and wheels still on it, etc. I filled out the checklist accordingly. The LO actually told me "You're just going to have to take all that stuff off the checklist. You know this deal is not going through if that's on there."

I try not to do manufactured homes anymore. I just end up making everyone mad, including me.
 

Farm Gal

Elite Member
Joined
Jan 14, 2002
Professional Status
Licensed Appraiser
State
Nebraska
Patti:

HUD has a real issue with this as in many cases even if title transfer by deed has occurred in the past AND the county indicates the property to be real AND the title has been purged, some of these things are still personal property :huh: . The comments at last weeks meeting we went to indicate that they at least are going to have some reall issues with this in some markets: they repod' the property but can't sell it without another title (or soemthing) :eek:

I don't get it as in THIS state it either IS or it AIN'T personal property!!

You may want to check closely into your state law on this matter.

or run...

how many of these ARE there in your market?

Let someone who specializes handle it!
 

Patti Jury

Senior Member
Joined
Mar 23, 2002
Professional Status
Licensed Appraiser
State
Colorado
Fishman,

The appraiser.. "according to L/O".. did NOT answer the foundation issues.. no "no" no nothing.. lol bad grammer thing...How many appraisers just ignore the question.. I can see a typo thing.. but the URAR is great for reduntancy.. he ignored it Twice. I just don't understand how this all got funded if she is just now purging it?

WOW I would love to follow the paper trail on this one!
 

Jo Ann Meyer Stratton

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arizona
There are a lot of appraisals (I would make a wild guess as to the majority of appraisals) on manufactured homes. mobile homes and other factory built homes that were not correctly completed by the appraiser because the appraiser was not familiar or knowledgeable about factory built housing. And just didn't want to take the time to do it correctly. At this point it is moot what the last appraiser did or did not do. Your report would be done subject to the the purging of title and the establishment of whatever procedures are required in that specific area for the home to be taxed as real property. You report would also be subject to the installation being approved by what ever governing agencies would be involved. You have inter mixed terms, using mobile home and modular. If the home was constructed to the HUD building code, it is a manufactured home. If it was constructed in a factory to a site built code like UBC, CABO, BOCA, etc, it is a modular home. If a manufactured home for FHA, the foundation and perimeter enclosure will need to be inspected by a licensed engineer. If a modular home to a site built code, you describe what you can see of the foundation and perimeter enclosure, the underwriter has to make a decision of whether they want further investigation by a licensed engineer or a government agency before the loan closes. If the loan is for Fannie Mae, then it is the underwriter's decision regarding the foundation whether it is a HUD code manufactured home or site built code modular home. If it is for Fannie Mae and is a manufactured home, then at least two of the comparables have to also be manufactured homes of the same number of sections. So although the previous situation looks strange and probably was fraud or at least just very incompetent; your report should be a correct reporting of the property as it existed on the effective date, subject to what ever conditions you think would be appropriate.
 

Farm Gal

Elite Member
Joined
Jan 14, 2002
Professional Status
Licensed Appraiser
State
Nebraska
Jo Ann:

I have learned more about this subject here on this forum and mostly thanks to you, than in any three classes I have attended for which I paid!

(Sorry Rich, it has been several years since I took your Appraising MFd Housing Class... I bet you have changed it some in the intervening span of time it took one of if not the first one you taught!).

and perimeter enclosure
OK as of Denver last week, this is NOT an engineering requirement... but appraisers call! One is to inspect and insure that it reaches the ground and is made of a substantial material and make no assumptions as to the depth to which it is buried and such despite the HUD indication being that one is to certify a 6" or or was it 8" depth... :angry:

further clarification to follow direct from HUD on this matter :eyecrazy:

don't hold your breath. :p
 

Patti Jury

Senior Member
Joined
Mar 23, 2002
Professional Status
Licensed Appraiser
State
Colorado
Hey Jo Anne,

As per L/O.. there is nothing in the appraisal that would reflect anything other than a stick built home. There is no reference that this is a mobile or modular. This issue was ignored.. plan and simple. The Vin # was readily available through Public Records as was any tax info.. and or property info..

I do have a good grasp.. at least I think I do as to the difference of MH or Modular.. but We have put this off until she consults her lawyer about what it was she purchased in the first place.

So how do we go from the question of personal property as per Public Records to the question of a potential (represented) stick built home as per appraisal.. "As I was told by L/O? ;)

This issue of mobile verses modular came up when.. prior to purging.. it was considered by the County as a Mobile..

Now a day after purging it turned into a modular as per County! LOL But again.. that is the least of the issue...
:eyecrazy: :eyecrazy: :eyecrazy: :eyecrazy: :eyecrazy: :eyecrazy: :eyecrazy: :eyecrazy: :eyecrazy: :eyecrazy: :eyecrazy: :eyecrazy: :eyecrazy: :eyecrazy: :eyecrazy:
 

Jo Ann Meyer Stratton

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arizona
And it is immaterial what the county or city or state or loan officer or homeowner or last appraiser calls the home. If it was built to HUD building code, then all those above have to deal with that fact. But for you as the appraiser working on an appraisal for a residential lender it will be a manufactured home--anything else is one of the other's problem and they will have decide how they will handle it.

Interesting side note has occurred in one of the small incorporated cities (1,000 population) in my area. Home owner talked to town council, mayor, city manager, etc, about installing a modular home on some family land. Lots of discussion by everybody, officials didn't want any "trailers" or "mobile homes" or "manufactured homes" in that area. Went over their city zoning regulation very carefully (they thought) so none of those dreaded homes would appear. Everything got approved and okay based on information that the home would be a modular. They did install a modular that is constructed to UBC just like their new "rules" required. The problem is that it is one of Cavco's modulars that are constructed to UBC using the same materials, design, appearance, including a steel undercarriage that Cavco uses for their manufactured homes. Cavco in Phoenix has been building that type of modulars for about 15 years to get around that zoning problem and it has been accepted in other communities state wide. Now all the neighbors, city officials, etc are all up in arms because a "trailer" has been installed. Anybody gets close to the lot, workers automatically go "are you here to see the modular insignia?" That blue modular label has been the most popular item in town for the past week. I didn't do the appraisal--but it is going to be an interesting property for many years in this county.
 

Jo Ann Meyer Stratton

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arizona
Lee Ann:
That is why I kept fussing about Chapter 1-09 in Las Vegas. The National HOC Reference Guide changed that responsibility from the appraiser in the 4150.2 to a responsibility of the underwriter to obtain an inspection by a licensed engineer. Both the supporting foundation for the unit and the perimeter enclosure has to be inspected by the licensed engineer. The appraiser just describes what is observable and puts a condition on the VC sheet for an inspection by a licensed engineer. That is why I was so glad to see the National HOC Reference Guide when it first came out in 2000, it took a huge responsibility off the appraiser's shoulders. Appraisers do not have the expertise to determine frost lines, type of footings, depth of footings, study engineer's blueprints, decide if what they are looking at is in compliance with those engineer's blueprints, etc, etc. Now we just need to write a sentence on the VC sheet and we are done. If the existing foundation and perimeter enclosure doesn't meet compliance, then the underwriter has to decide whether to have it retrofitted or decline the loan. Since the appraiser has made it subject to an approved foundation/enclosure--we are done.
 

Farm Gal

Elite Member
Joined
Jan 14, 2002
Professional Status
Licensed Appraiser
State
Nebraska
Well apparently they didn't get it - or the DEN HOC at least doesn't CARE...

They stressed repeatedly that the perimeter is an apparaiser call whilst the foundation is an engineer's.

go figure.

the right hand doesn't know/care what the left hand... :blink:
 
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