BetterAppraisers

jimgraner wrote:In rural OK, I guess you have few properties that are really similar. In suburbia, I see the same house in several locations and several subdivisions. Some sections of a report call for similar comments.

Annemieke Roell wrote:

jimgraner wrote:OK, that is detailed!

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Every report that leaves out office is written specifically for that assignment.

Indeed. But even on suburban properties we write the whole thing.

You are right, my bad! Its a refi comment!

We are pressued to fill in each blank of the URAR. He has something to complete fill in the blank for the situation. I personally use not applicable, keeps the underwriters from asking questions. I have been asked to fill in blanks for things that have already been answered or do not apply. It's a crazy world.

Thanks for the notice, I missed that part.

Annemieke Roell wrote:

jimgraner wrote:Benji, (AKA Greenback)

If you are assigned an order with a SOW that includes a short period to return the report, and a contract is not sent. You have requested and get a reply of "Not available yet." You have performed an attempt to review the contracts, per USPAP. AMC's are good for that on purchase deals, that's life. I will not degrade anybody doing AMC work, others get mean to their peers that perform this kind of work. Sometimes that is all there is.

You required to attempt to gather the information, you cannot get what is not available. Give your explanation and move on. Similar statements are used for similar circumstances, whether you keep them in your library or make them up each time.

Benji wrote:

Annemieke Roell wrote:Boilerplate? Why use boilerplate at all?


BTW, Benji .... that is a very bad idea. If I were you I'd can that statement.

Hi there What's up?

It's just one of the statements I tend to use when it fits. If there are no purchase contracts at the time of sale or none were observed from the past, then I will comment on it, as of an effective date of the Appraisal.

I don't use it constantly and I always try to make my statments better than they once were. I will not can that statment when it's considered appropriate, at times. I may add to it or take away from it, when need be, to conform with the scope of work.

You have yourself a nice day
Happy Easter...

Sincerely,

You may want to read that again, Jim. He is using that statement on a refi.

The Appraiser(s) did not analyze a buy- sell contract/agreement. There are no such agreements/contracts associated with the pending
refinance transaction of the subject property. The client did not provide a purchase agreement for the Appraiser(s) to analyze.

jimgraner wrote: Ever duplicated market conditions?

You mean something generic like this?

Primary financing within the market area is FHA, VA and conventional with little seller participation. Financing is readily available in the market area with interest rates in the 5.75% -6.25% range with 0-4 discount points. Property values have reflected stability within the area with the market time being less than six months for homes which are reasonably priced and properly marketed.

Most of this is crap. The intended user was a mortgage broker. The intended purpose was verification of collateral for lending purposes. Does ANYONE think the MB or the LO doesn't know what the interest rate is? Or the availability of FHA, VA or Conventional financing? Do you REALLY think the mortgage professionals are unaware of seller participation? In this paragraph/comment there are two bits of genuine information. 1) the market is stable (that really IS a market condition) and 2) marketing time is less than 6 months. On the appraisal this came from the check box for increasing values was also checked, making the market stability issue contradicting. Does the underwriter believe values are increasing? or is it stable? Remember in Principles how there is an upwards trend (increasing market), then a plateau (stable)? So which is it?

Do you really think this kind of crap is going to pass an underwriting audit? I have four appraisals by the same appraiser with the identical comments in three different neighborhoods. All four reports are going to the state. This appraiser has been in business since 1991. There is a serious possibility that this will be his/her last year as an appraiser. All four reports were written in 2005. What you write today can and will come back and bite you if you aren't doing it right.

If you are going to describe a market condition tell the underwriter what the conditions are.....they are paying for and deserve the truth. Tell them what the market is. Explain what kinds of housing is available, how long it takes to market, what kinds of people are moving into the area, what businesses are growing, what are decreasing.

Remember, market is the external to the property.......the conditions and what is happening outside the boundaries. The property description is Marketability, and that is within the boundaries of the subject property.

So NO!!!!! I do not ever use canned comments for Market Conditions.

Fair enough! If the comments do not actually describe what is happening, there is a problem!

Goodpasture wrote:

jimgraner wrote: Ever duplicated market conditions?

You mean something generic like this?

Primary financing within the market area is FHA, VA and conventional with little seller participation. Financing is readily available in the market area with interest rates in the 5.75% -6.25% range with 0-4 discount points. Property values have reflected stability within the area with the market time being less than six months for homes which are reasonably priced and properly marketed.

Most of this is crap. The intended user was a mortgage broker. The intended purpose was verification of collateral for lending purposes. Does ANYONE think the MB or the LO doesn't know what the interest rate is? Or the availability of FHA, VA or Conventional financing? Do you REALLY think the mortgage professionals are unaware of seller participation? In this paragraph/comment there are two bits of genuine information. 1) the market is stable (that really IS a market condition) and 2) marketing time is less than 6 months. On the appraisal this came from the check box for increasing values was also checked, making the market stability issue contradicting. Does the underwriter believe values are increasing? or is it stable? Remember in Principles how there is an upwards trend (increasing market), then a plateau (stable)? So which is it?

Do you really think this kind of crap is going to pass an underwriting audit? I have four appraisals by the same appraiser with the identical comments in three different neighborhoods. All four reports are going to the state. This appraiser has been in business since 1991. There is a serious possibility that this will be his/her last year as an appraiser. All four reports were written in 2005. What you write today can and will come back and bite you if you aren't doing it right.

If you are going to describe a market condition tell the underwriter what the conditions are.....they are paying for and deserve the truth. Tell them what the market is. Explain what kinds of housing is available, how long it takes to market, what kinds of people are moving into the area, what businesses are growing, what are decreasing.

Remember, market is the external to the property.......the conditions and what is happening outside the boundaries. The property description is Marketability, and that is within the boundaries of the subject property.

So NO!!!!! I do not ever use canned comments for Market Conditions.

Excellent points and comments. Good Pasture (Jim, I think you already know this), at the risk of losing your respect, I'm working toward a license upgrade and your comments are most appreciated. Thank you.

You might check with different board members in your state.

I have been to different meetings in Missouri. Over here, once a year the board accesses itself to the appraisers. We have discussed canned comments at length. I have read that other states have different opinions.

My wifes review asked about canned statements for Certification. No big deal, she explained that different circumstance requires different statements. Similar circumstance requires similar statements.

For Missouri,

No comments that do match facts.

Go easy on them, let's not overdue it!

Yes we have similar conditions that require similar statements.

Descriptions should fit subject property and not a town at the other end of your service area.

DebC wrote:Excellent points and comments. Good Pasture (Jim, I think you already know this), at the risk of losing your respect, I'm working toward a license upgrade and your comments are most appreciated. Thank you.

And that is what we are all about on this forum! Welcome and thank you.

GoodPasture was not kidding about his State Board and these kind of statements. About page 12 Sales comparison, other places this issue is tackled in this document.

"Price range is a good example of where “canned” or “boilerplate” comments (such as “the appraiser notes that the subject value exceeds the predominant price for the area, but it is not considered an over-improvement”) are not appropriate." .

See link below

http://64.233.167.104/search?q=cache:op ... %2520(0602).dot+APPRAISERS,+CANNED+STATEMENTS,+OKLAHOMA&hl=en&ct=clnk&cd=1&gl=us

It is essential to be accurate and explain both why you adjusted something or did NOT adjust something.

I submitted a report some time back where I did NOT adjust for age. As I find it difficult to find a market response for age (condition is far more relevant) it was simply a matter of skipping over that cell and finishing the report. When I discussed it with the UW's reviewer he seemed to insist that there was ALWAYS an adjustment there. It is one that he expects to see, and if I had made up a number he would have been happier. I followed up the appraisal with the following data:

A survey of houses that sold in the last 6 months, in the Tulsa MSA, that are between 2030 sf and 2230 sf (the subject is 2130 sf), and built on lots in excess of 1 acre found the following sale of prices per square foot. The typical house was a 3 bedroom, two bath house with a two car garage. The average selling price per square foot, of houses sold in the past 6 months, for houses that were built In the years between:

1960 and 1965 was $101 psf.
1965 and 1970 was $86 psf.
1970 and 1975 was $75 psf.
1975 and 1980 was $70 psf.
1980 and 1985 was $80 psf.
1985 and 1990 was $89 psf.
1990 and 1995 was $112 psf.
1995 and 2000 was $86 psf.
2000 and 2005 was $79 psf.
2005 and 2008 was $91 psf.

This shows the median price over the last 48 years to be $87 psf. Interestingly enough, the second highest prices on houses in the survey were built between 1960 and 1965 with the most valuable houses being built between 1990 and 1995. Houses built between 2000 and 2005 are selling within $1 psf of the houses that were built between 1980 and 1985. Both the mode and mean is $86 psf putting both the subject and the comparable houses selling below the averages.

The point is, it is as important to explain why you DON'T make an adjustment as it does why you do. Particularly if there is a substantial discrepancy between one feature on the subject and a similar but different feature on the comparable.

That is good information guys. I followed the link you provided, Jim. Very interesting. I contacted the WV state board some time back to see if they had something similar to this or some type of guide to indicate EXACTLY what they expect in a report when one is trying to upgrade their license and they do not. It's interesting to me that not all states have the licensed level. Wonder why that is? Thanks for posting!