I hope the loan goes through. I actually think it is a good idea. The Banks deserve to understand what they are getting as security. It is almost the same as a retail store running your credit card through for authorization or asking ID on your check. I have heard some loans not going through because homes were basically not livable in the sales condition. The bank does not want to take a home back that ia not livable? We see many out there today. I believe the banks should be equally concerned with the condition and the terms of the comps they are using. They don’t know if they are comparing a home with a $30,000 termite problem or not. They don’t know if there was a 3% credit back. They don’t even know if the home they are loaning on or comping with has foundation issues. I believe for the health of our industry more sales details need to be made available to appraisers and Real Estate agents.
Maybe homes need to be graded A-F. A could get a 95% loan and B could get an 85% loan etc. Bank’s security needs to be protected, just like when you loan something to a friend you expect it back in the same condition. Once again I hope your deal goes through but changes are needed.
Lee
http://www.leesellsmore.com

Joseph Russo
Certified Residential Appraiser Lic#AR035461
http://www.myappraisalteam.com

If you have been doing FHA loans and appraisers are NOT doing this – they are not doing their jobs.

No, we are not home inspectors but we are concerned with any item which may impact the value of the home.

Even for non-FHA work, if it is a purchase, I like to get any information from the home inspector I can as well. If not, then I am limited to what I “observe” at the home. Our observations for FHA loans are required to test the water (hot water, water pressure, etc), electrical outlets, windows, etc – not to warrant them, but to know they are working and will not pose a safety issue.

We are supposed to be the eyes of the lender – any appraiser who is “breezing” through the property and not taking this into account is a blind representative of the lender!

Richard Ferris – AmcAppraisalsinc.com
Clermont, FL (St Cert Res REA #RD4088)

FHA appraisals have been rare over the last 5 years, because of the ease and relative lower bureaucratic requirements of the sub-prime and Alt-A loans at the time.

I expect FHA loans will become more common given higher loan limits in high-cost areas, and because of the scarcity of sub-prime and Alt-A loans.

From your comments, you seem to be an Agent with only a few years experience & had not encountered a professional valuation expert before. What you encountered this time was a professional appraiser who was trying to conduct a professional analysis, not someone that was being “whipped” by a Lender. An appraisers inspection is much less in-depth than that of an experienced Home Inspector.

I always ask for a copy of the Home Inspection AND the Transfer Disclosure Statement in a sale transaction. What if there are serious problems with the property. Don’t you want the valuation expert to know about these problems and then be able to measure if there is any affect upon the value of the property? Don’t you think that the Buyer will be VERY interested if any of the problems affect value?

For most Inspections I review, there are no major problems, just items that are called out and need to be repaired. However, sometimes there are major items that are found by the inspector that an appraiser’s “typical” inspection wouldn’t have found. That’s when the appraiser should be informed so that they can measure whether this issue, whatever it is, has an impact on value. I like to be there at the same time as the Home Inspector so we can “compare notes” about the property.

When would you rather deal with this type of situation? Before Close of Escrow? – or in Court after the Buyer discovers the problem and sues everyone because the value of their property is impacted?

You obviously don’t deal with FHA. Climbing in the attic & looking in the crawl space have been FHA requirements for appraisers for decades. Chcking the plumbing fixtures & the HVAC has also been a FHA requirement for Appraisers.

This is a good thing! It’s something my peers SHOULD have been doing all along – instead of just ‘rubber-stamping” the appraisal. My profession has abdicated its responsibility over the past 6-years and this is one reason we are in the “mortgage crisis”.

Your question RE: an appraisers job discription is a valid one. I’m going to add this to my website in the next week or so to answer this question. (Website is: http://www.jccrea.com. much of it is under re-construction, so pardon my “dust”.)

I hope this has been helpful. We are now going back to the way “it shoulda been done all along”.

John C. Carlson
CA Certified General Real Estate Appraiser
Diamond Bar, CA