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Old 07-22-2012, 03:57 PM
 
61 posts, read 125,507 times
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Quote:
Originally Posted by yousah View Post
You bring up an interesting point, and one that is argued among appraisers themselves. The report is supposed to be understandable by its intended users, but who those intended users are is sort of foggy. Appraisers know that their report will likely be provided to the borrower pursuant to lending regulations. Does the appraiser then have an obligation to those people? It's arguable, even though the Fannie appraisal cert pages state that the lender is the intended user. However, some state licensing boards interpret the borrower to also be an intended user because the appraiser is fairly certain that they'll eventually get a copy of the appraisal.

This situation has been made worse with the UAD specifications which are basically a set of pre-determined standard abbreviations for completing the form. Even appraisers have a hard time remembering the abbreviations. So how is any intended user supposed to understand the report if so much of it is encoded?

Most of us now include additional pages in our appraisal that have the abbreviations interpreted so that we can't be accused of reporting an appraisal that is not understandable to the intended users. It's just another situation where Fannie does their own thing, oftentimes in violation of USPAP, and leaves appraisers and regulators to mop up the mess.
Quote:
Originally Posted by NativeJr View Post
This is my ASSUMPTION too. But why did he just not say this in his analysis; oh, I know, you say he did I am just too stupid to understand it.

While I understand an appraiser's client is solely the mortgagor, I think an appraiser should also understand that his work is going to be viewed by both the buyer and the seller. The language of his report should be such that an average person outside his field of expertise would have little difficulty understanding his conclusions.

You sent the appraiser a request for an explantion. His failure to answer was not a slight to you, he is restricted from discussing the appraisal with you. You are not the client or the intended user. I (yes, I'm an appraiser) cannot discuss this with anyone. I have no idea in what state yousah practices, but here in Florida, and as per USPAP (federal regulations) we are barred from discussing this with anyone other than the client, without specific written autorization. There is no gray area. We CANNOT discuss the report with anyone else.
It can be very frustrating for us too. Many times, I would love to be able to explain why I arrived at a certain number.

I realize you are actually looking for a reason he didn't come in at $158k, where two of the comps had an adjusted value. You're not going to get an answer, because the appraiser can't give his entire reasoning (see above) and the rest of us can only guess.



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Old 07-22-2012, 05:05 PM
 
265 posts, read 342,961 times
Reputation: 184
Several posts ago, I quoted the exact wording of his summary. In your opinion. as an appraiser, do you feel it is adequate? Would you have written it the same way? Am I missing some meaning that only the intended client would understand?

Also, whether it is legal or not, this info is commonly shared with the buyer and seller in Georgia.

PS: I do appreciate everyone's input. It has been a big help in my understanding of the process and the realization that I may never get truly get an answer.

Last edited by NativeJr; 07-22-2012 at 05:17 PM..
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Old 07-22-2012, 05:15 PM
 
3,029 posts, read 6,959,832 times
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I am also an appraiser - since 1983. I've served as a review appraiser for various lending institutions as well as federal agencies. I've also been qualified by and served as an expert witness in various courts of law regarding the valuation of real estate. While the appraiser is required to explain the reconciliation, a specific explanation for his exact price point isn't necessary especially when the conclusion of value is reasonable and within the adjusted range. A final value within the range indicated by the adjusted values and in line with the most comparable sales is reasonable and this should be obvious even to an inexperienced non real-estate professional. Let me say this again: IT IS NOT NECESSARY NOR IS IT A REQUIREMENT OF USPAP TO EXPLAIN THE FINAL VALUE ESTIMATE IF THE ANALYSIS IS REASONABLE AND IT FALLS WITHIN THE RANGE INDICATED BY THE ADJUSTED VALUES.

The value could have been 156K or 158K. An appraisal is an OPINION, not rocket science which must be explained in the last detail to someone who is NOT THE CLIENT. In a self-contained report, a more detailed explanation would be called for. Form reports are typically done to the USPAP standards of a summary report and not every detail of the analysis is given nor is it required. It's my opinion that form reports are more representative of a Restricted Use format as outlined in USPAP. That said - he could have done a better job of explaining it. But after reviewing tons of reports - the verbage you quoted appears to be adequate for the intended user and very typical.

Even if you as the borrower paid for the report, you do not "own it", you are not the client, and the appraiser owes you no explanation whatsoever.
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Old 07-22-2012, 05:20 PM
 
61 posts, read 125,507 times
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Quote:
Originally Posted by NativeJr View Post
Several posts ago, I quoted the exact wording of his summary. In you opinion. as an appraiser, is that adequate.

Also, whether it is legal or not, this info is commonly shared with the buyer and seller.

Is his summary adequate? Yes, it's adequate, could he have said more, yes.

The buyer is entitled to obtain a copy of the appraisal from the lender. I however, cannot, send a copy to the buyer. They have to get it from the lender. And even thought they have a copy (and many times paid for it) I still can't discuss it with them. That's your tax dollars at work! If you can explain it to me please do.
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Old 07-22-2012, 05:24 PM
 
265 posts, read 342,961 times
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Thanks ETex2, I "get" all that your are saying. However, I do not think you understand the purpose of my question. Again, I am not critizing the appraisal or the appraiser. I am just trying to satisfy my need to know.

Mayber, I should had just posed this as a hypothetical question.
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Old 07-22-2012, 06:09 PM
 
61 posts, read 125,507 times
Reputation: 82
Quote:
Originally Posted by NativeJr View Post
Thanks ETex2, I "get" all that your are saying. However, I do not think you understand the purpose of my question. Again, I am not critizing the appraisal or the appraiser. I am just trying to satisfy my need to know.

Mayber, I should had just posed this as a hypothetical question.

I do appreciate you not immediately criticizing the appraiser or appraisal. The first response to an appraisal, many times, is to criticize the appraiser (as seen in some previous posts). I appreciate you wanting to understand vs unjustified attacking of someone's reputation.

Now, hypothetically speaking, based solely on the information you provided, could the appraiser arrive at a value of $158k? Yeah, it's not outside the range of possibility. However, he also could have arrived at a value of $150k to $153K, not using the outside comp, and depending on how much weight was given to the higher two. I say this range as it is bracketed by the sales prices, and not just the adjusted prices. It's still an opinion and part of what comes into the number is how the appraiser weighs each item.

This is just my opinion, having no knowledge of your local market or the nuiances involved. I am giving you this information as a real estate broker, and my knowledge based on my local customs. This is not a review or an appraisal of any kind.

I realize this is important to you (it's your $2,000). I wish you could get an answer that would satisfy you. Again, thanks for the question. It would be nice if more people asked questions instead of making statements that have no basis in fact.
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Old 07-22-2012, 10:07 PM
 
265 posts, read 342,961 times
Reputation: 184
Quote:
Originally Posted by lls1662 View Post
I wish you could get an answer that would satisfy you. Again, thanks for the question. It would be nice if more people asked questions instead of making statements that have no basis in fact.
I am glad I pressed the point because after four pages of discussion, I have a much greater understanding of how he arrived at the appraised value. I really do appreciate everyone's input. You have educated me.
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Old 07-24-2012, 02:06 AM
 
936 posts, read 1,763,783 times
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Quote:
and as per USPAP (federal regulations) we are barred from discussing this with anyone other than the client,
Where exactly did I say that the appraiser should be discussing this with the borrower? I didn't.

I did mention the controversial aspect of the appraiser knowing that the appraisal will likely go to the borrower despite the borrower not being an intended user- in a technical sense. This is reinforced with certification #23 that's included in any Fannie appraisal where the appraiser is affirming that the borrower "may rely" upon the appraisal. The courts have allowed many lawsuits based upon Cert #23. This is where the pseudo "intended user" concept comes into play. This is frustrating for appraisers because we really shouldn't be liable to borrowers, but the courts have said otherwise. Nonetheless, the are not an intended user in a technical sense, nor do we own them any explanation. It is interesting to note that any appraiser who is included the UAD definitions in his or her appraisal is probably doing it for the benefit of the borrower rather than the lender/client who is a professional who should not require these definitions.
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