FHA question

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Shuggins

995 Posts

Posted - 07/21/2008 : 12:46:26 PM

So the wonderful lady I use for appraisals is on her way back from a job up north and she encountered a possible problem. So I thought I would send it out to all of you, Including the appraisers out there (since it is an appraisal issue).

In June there was a pretty bad storm that went through the Duluth area and the home had some water damage in the basement. The homeowners (sellers) have added gutters & a sump pump to keep the issue from happening again, they of course also replaced the carpet. In the P.A. there is an addendum that states they had this issue. Is this going to be a problem on the appraisal? Does she need to do anything different on the appraisal? If so what will she need to do?

Thanks

EquitySmart

1240 Posts

Posted - 07/21/2008 : 1:46:14 PM

I am not an appraiser ... but I would say the appraiser is supposed to provide an accurate report of the estimated value of the property, based on its CURRENT condition.

The knowledge that there were bad storms in the area last month may cause the appraiser to inspect certain areas of the house more than they normally would, but the bottom line is the CURRENT condition of THAT house (not what happened to some unknown number of houses in the area last month). If the newly added gutters and sump pump all meet the necessary building/zoning codes and provide an adequate solution to prevent future damage (with reasonable likelihood) then I would think the appraiser should probably note these items in the comments. If they do not meet the building/zoning codes and/or they do not provide an adequate solution to prevent future damage, then the appraiser should definitely mention them in the comments, possibly with a recommendation for inspection by licensed plumber/roofer/etc. The USPAP guidelines and/or common sense should (hopefully) provide adequate guidance to the appraiser on how they should handle this situation.

Hopland

2069 Posts

Posted - 07/21/2008 : 2:02:43 PM

I agree with EquitySmart. But USPAP does not address these types of specific issues. You can find the requirements by going to:

http://www.hud.gov/offices/adm/hudclips/handbooks/hsgh/

and finding HUD handbooks 4150.2 and 4000.2 and by going to the reading room and downloading the attachment to ML2005-48 (the attachment is the revised Appendix D to 4150.2).

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