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Good afternoon.
Effective in November 2021, the updated guidance now prevents many of those comments (if not all of them) from being included in the reports. You will want to make sure your appraisers are up to date on those guidelines. It may be a good idea to send your appraisers a link to them or tell them where to find them. If they simply Google “Fannie Mae Selling guide section B4-11-04” they will find what they need. Specifically regarding your question, the 3rd bullet in this section refers to “use of unsupported assumptions, interjections of personal opinion, or perceptions about factors in the valuation process and the use of subjective terminology…” and then it goes on to give some examples. In some cases, the comment may come down to the reader’s interpretation as to whether or not it falls into this category, but often times it is very evident that the comment should be removed. Have a great weekend! Eric CollinsworthGood afternoon!
When requesting to use an appraisal from another bank, you should not involve the appraiser. The bank that has the appraisal simply sends the report to the bank requesting it and the appraiser does not need to be involved. If you are requesting the report, then ask the other bank to send you a copy of their actual report (your FI’s name does not need to be in the report), they need to attach a copy of their engagement letter proving they ordered the report properly (and that the appraiser has no interest in the transaction, parties or the property) and the report should be reviewed by your FI to confirm it meets your bank’s policies. By asking the appraiser to “readdress” the report over to you (or if you had asked yourself), that bank has potentially violated regulatory guidelines AND by the appraiser agreeing to do so, they have potentially violated USPAP! There is no need to ever involve the appraiser for this process. IF you want to get the appraiser involved (and this would be my suggestion), ENGAGE the appraiser as a whole new assignment and let him/her know you know they just completed it for another institution recently. Let them know when you engage them you expect the effective date to be on or after the date you engage them and you expect they might charge a small fee as they would need to re-inspect the property. Then, if you have ANY problems with the report, you can go back to the appraiser for corrections (you can’t do that when you use a report written for another institution)!For compliance with the Interagency Appraisal and Evaluation Guidelines, the report should include an “As Is” value on the effective date of the report if this is an in-house transaction (secondary market appraisals are exempt from this). If this is a proposed construction and the report includes a completed Cost Approach, the Site Value indicated should suffice as the “As Is” value if construction has not started and the site is still vacant as of the effective date. There is no need to ask the appraiser to adjust the report to note this to be an “As Is” value if the site is vacant. However, if there are any other improvements (an existing barn, for example) or if construction has already begun, then the Site Value may not be sufficicent and the report needs to address what the “As Is” value is on the effective date along with a summary of support for that value.
