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Appraisers punting to inspectors

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Now that the appraisers have been charged with more responsibility, have any of the rest of you been getting calls to check out specific defects they've already reported, in the exact same way we would?

Does anyone involved in a real estate transaction actually have a clue about what we do?

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I'll explain it better. I've been getting calls from non client buyers who likely waived an inspection. The appraisers are directing these people to hire an inspector to give them the yay or nay to simple inspection 101 type defects they discovered.

They write pretty much what we would, but rather than defer to a contractor for repair, they recommend hiring an inspector. The only reason I can think of is they're trying to dump their responsibility on someone else?

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Not trying to sound like a pedant but I don't think what appraisers and home inspectors write about is pretty much the same. Our reports have a fundamentally different objective.

They defer to us in this case because what they need is right up our alley. They defer because what's needed is not something they normally do, unless they're HUD registered appraisers, then it is. HUD registered appraisers are like appraiser and inspector rolled into one.

When they do defer to us, we sometimes end up doing the same thing they did by deferring to 'qualified personnel'.

We're both looking out for our liabilities by staying within the boundaries of what we do.

Marc

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Not trying to sound like a pedant but I don't think what appraisers and home inspectors write about is pretty much the same. Our reports have a fundamentally different objective.

They defer to us in this case because what they need is right up our alley. They defer because what's needed is not something they normally do, unless they're HUD registered appraisers, then it is. HUD registered appraisers are like appraiser and inspector rolled into one.

When they do defer to us, we sometimes end up doing the same thing they did by deferring to 'qualified personnel'.

We're both looking out for our liabilities by staying within the boundaries of what we do.

Marc

Marc, I appreciate your opinion.

Now, let's review. The appraiser described a chickenshit defect exactly the way an inspector would, with the exception of deferring to a contractor.

This isn't the first time it's happened since the banks decided to raise the bar for them. This isn't a case like when they had legitimate reasons for a second opinion from one of us.

This is going to become the norm for those looking to pass their liability to another. This is the beginning. Give it six months before claiming I'm the boy who cried wolf. I saw it coming when they instituted change and the appraisers raised hell about it.

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Not trying to sound like a pedant but I don't think what appraisers and home inspectors write about is pretty much the same. Our reports have a fundamentally different objective.

They defer to us in this case because what they need is right up our alley. They defer because what's needed is not something they normally do, unless they're HUD registered appraisers, then it is. HUD registered appraisers are like appraiser and inspector rolled into one.

When they do defer to us, we sometimes end up doing the same thing they did by deferring to 'qualified personnel'.

We're both looking out for our liabilities by staying within the boundaries of what we do.

Marc

Marc, I appreciate your opinion.

Now, let's review. The appraiser described a chickenshit defect exactly the way an inspector would, with the exception of deferring to a contractor.

This isn't the first time it's happened since the banks decided to raise the bar for them. This isn't a case like when they had legitimate reasons for a second opinion from one of us.

This is going to become the norm for those looking to pass their liability to another. This is the beginning. Give it six months before claiming I'm the boy who cried wolf. I saw it coming when they instituted change and the appraisers raised hell about it.

Understood. I'll look for it on the horizon.

Marc

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I had an appraiser there while I was doing the inspection. She asked if I could tell her where the water heater was. I told her it was in the garage. She looked at me with a blank stare so I took her into the garage and pointed toward the furnace and water heater. She asked, "which one is the water heater?"

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Read up on the new rules and requirements banks are laying on appraisers. They're being required to report on stuff that they really don't know or understand. Our stuff.

It's a good thing for our profession. It's forcing banks to reevaluate their relationship to us, which is to say, they have to acknowledge we exist.

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I'll explain it better. I've been getting calls from non client buyers who likely waived an inspection. The appraisers are directing these people to hire an inspector to give them the yay or nay to simple inspection 101 type defects they discovered.

They write pretty much what we would, but rather than defer to a contractor for repair, they recommend hiring an inspector. The only reason I can think of is they're trying to dump their responsibility on someone else?

I think they are just trying to transfer liability to the inspector.

I must be missing something... If they are not an inspection client how do they transfer any responsibility or liability to an inspector.

As and example - inspector Smith gets a call from a home buyer -

Buyer - "The appraiser from my bank said I should call an inspector because XXX looks funky"

Inspector - "I've never seen your house before, but for $350 I will be more than happy to schedule a full inspection"

Buyer - "But, I just want to know about X"

Inspector "Sorry, but again I have never seen your house"

How has any liability/responsibility transferred???

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Over the year's, I have had appraiser's call out items during their appraisal, that they wanted either verified or explained away by me, on letterhead. In all cases, it was a total waste of time, and simply the appraiser, not knowing what they are looking at. For example; I had an appraiser call out a Zinsco panel on a 2000 built home. They required that I put on letterhead, that it wasn't. That letter was a bit snarky to say the least.

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I see appraisers run through an average house in about 15 minutes - They don't get high pay for what they do.

One guy would show up right when the realtor opened the door for me. One day I heard him telling her all about PolyB plumbing. His observation was that when he called out PolyB, the buyers ran into insurance difficulties. So he just puts down 'plastic' in his report and everybody is happy. [:)]

They are no threat to us here, but we will see what the future has in store.

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Read up on the new rules and requirements banks are laying on appraisers. They're being required to report on stuff that they really don't know or understand. Our stuff.

It's a good thing for our profession. It's forcing banks to reevaluate their relationship to us, which is to say, they have to acknowledge we exist.

Where can I find such reading material?

Marc

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I'll explain it better. I've been getting calls from non client buyers who likely waived an inspection. The appraisers are directing these people to hire an inspector to give them the yay or nay to simple inspection 101 type defects they discovered.

They write pretty much what we would, but rather than defer to a contractor for repair, they recommend hiring an inspector. The only reason I can think of is they're trying to dump their responsibility on someone else?

I think they are just trying to transfer liability to the inspector.

I must be missing something... If they are not an inspection client how do they transfer any responsibility or liability to an inspector.

As and example - inspector Smith gets a call from a home buyer -

Buyer - "The appraiser from my bank said I should call an inspector because XXX looks funky"

Inspector - "I've never seen your house before, but for $350 I will be more than happy to schedule a full inspection"

Don't need to do a complete inspection just to inspect one item.

Buyer - "But, I just want to know about X"

Inspector "Sorry, but again I have never seen your house"

How has any liability/responsibility transferred???

It wasn't. Until home buyer signs contract, inspector has no liability/responsibility.

Marc

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Where can I find such reading material?

Marc

I've seen it in the NYT and in that realtor rag I get emailed...the ezine that is for inspectors and appraisers. I often trash it, but I read bits of it on occasion.

I've seen it in a few trade related publications....can't remember which ones.

I've also talked to appraisers about it...nothing in depth...just questions, and they've indicated they're being asked to do stuff they don't know squat about. They don't like it. At all. The banks are looking to lay off liability on them, not us.

It's a matter of time until they call us, but it's banks and they don't want us or they'll have a hard time writing notes. So, not sure what it'll look like, but eventually we'll be doing something along this line. Expect insurance companies to do the same sort of thing. Everyone's looking to lay off risk onto someone else's insurance policy.

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I must be missing something... If they are not an inspection client how do they transfer any responsibility or liability to an inspector.

As and example - inspector Smith gets a call from a home buyer -

Buyer - "The appraiser from my bank said I should call an inspector because XXX looks funky"

Inspector - "I've never seen your house before, but for $350 I will be more than happy to schedule a full inspection"

Buyer - "But, I just want to know about X"

Inspector "Sorry, but again I have never seen your house"

How has any liability/responsibility transferred???

Most of the time, as Robert mentioned, the banks demand the buyer find an inspector to provide documentation on letterhead before they'll cut a check. That lays part of their decision on what you wrote.

Two examples. A client was somehow allowed by the seller to make his own repair to a foundation in an area where water was leaking into a basement. His bank demanded a letter from me stating the repair was complete and would eliminate the water problem in the future.

Not my job to guarantee a DIY repair so a bank can write a loan. It had been in the report at the time and he was advised he hire a contractor to make repairs.

Had he taken the advice he paid for, the contractor could have warranteed the work. Problem solved.

I told them the only way the bank was getting anything from me would be after they signed a contract and wrote me a check for my service. Last I heard, they found another inspector to write the letter for $50.00.

The second one was a call from someone who waived an inspection. The appraiser found mold on the roof deck in the attic. I don't know who cleaned it up. The bank insisted on a letter from an inspector stating it had been properly remediated.

This time, I ended up in a phone conversation with the bank rep. Just couldn't get it through her head that what she was looking for was outside of the scope of what we do. She was looking in the wrong direction. I wasn't about to become beholden to a lending institution writing a loan.

There have also been other examples. My refusal rocketed me to the top of the doesn't play well with those who will say or do anything for a buck, list.

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Read up on the new rules and requirements banks are laying on appraisers. They're being required to report on stuff that they really don't know or understand. Our stuff.

It's a good thing for our profession. It's forcing banks to reevaluate their relationship to us, which is to say, they have to acknowledge we exist.

Where can I find such reading material?

Marc

Marc the new HUD handbook has a huge impact on appraisals. I am working at a semi-national level with appraisers regarding some specific issues; inspecting appliances for instance.

The appraisal business is not fond of these changes in my area.

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Most of the time, as Robert mentioned, the banks demand the buyer find an inspector to provide documentation on letterhead before they'll cut a check. That lays part of their decision on what you wrote.

Two examples. A client was somehow allowed by the seller to make his own repair to a foundation in an area where water was leaking into a basement. His bank demanded a letter from me stating the repair was complete and would eliminate the water problem in the future.

Not my job to guarantee a DIY repair so a bank can write a loan. It had been in the report at the time and he was advised he hire a contractor to make repairs.

Had he taken the advice he paid for, the contractor could have warranteed the work. Problem solved.

I told them the only way the bank was getting anything from me would be after they signed a contract and wrote me a check for my service. Last I heard, they found another inspector to write the letter for $50.00.

The second one was a call from someone who waived an inspection. The appraiser found mold on the roof deck in the attic. I don't know who cleaned it up. The bank insisted on a letter from an inspector stating it had been properly remediated.

This time, I ended up in a phone conversation with the bank rep. Just couldn't get it through her head that what she was looking for was outside of the scope of what we do. She was looking in the wrong direction. I wasn't about to become beholden to a lending institution writing a loan.

There have also been other examples. My refusal rocketed me to the top of the doesn't play well with those who will say or do anything for a buck, list.

I know it can make you look bad to the RE agents (but who cares), but they are asking for something outside the scope of the services an inspector provides.

In both cases you cite an inspector can't be expected to proffer an opinion as to the correctness of the repair/mitigation. Because someone was willing to do it for $50 just proves they are an idiot.

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Yes. It can be good business. $50 bend overs isn't good business, but understanding how to structure and deliver valid opinions can be.

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For some reason there is a memory rattling around in my brain that there are recent changes to the HUD rules that include wording that requires/recommends a home inspection. Maybe this is part of what they are now doing as part of the appraisals.

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For some reason there is a memory rattling around in my brain that there are recent changes to the HUD rules that include wording that requires/recommends a home inspection. Maybe this is part of what they are now doing as part of the appraisals.

Home inspections have never been mandated by HUD/FHA in any state of the country.

If anyone has seen a HUD/FHA document contrary to that, I'd love to see it.

Marc

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For some reason there is a memory rattling around in my brain that there are recent changes to the HUD rules that include wording that requires/recommends a home inspection. Maybe this is part of what they are now doing as part of the appraisals.

Home inspections have never been mandated by HUD/FHA in any state of the country.

If anyone has seen a HUD/FHA document contrary to that, I'd love to see it.

Marc

Now you made me actually try and find what I once read. It is a recommendation to get a home inspection. It is not mandated, just a recommendation to get a home inspection (moths are flying out of my ears now).

http://portal.hud.gov/hudportal/documen ... _13757.pdf

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I get called in fairly often to comment on structural concerns and sometimes wet basement concerns. Usually the mortgage company calls for a Structural Engineer (me) or a licensed contractor. In PA a licensed contractor does not need any training or experience, but the mortgage companies don't know any better.

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I have not been asked by an appraiser about problems with a house. I have been asked by buyers how much I thought the house was worth. Sorta the other way around for me. But I let voicemail take most of my calls. If any of those were appraisers, I doubt they would leave a message.

I once inspected a house and the roof needed to be replaced overall but also needed immediate repairs at minimum. It looked fine from the ground so unless one went up on it, you'd never know. I reported on it as usual. A few days later they had a roofing contractor inspecting the roof. At the same time there was appraiser there. The roofer came down off the roof and walked in saying the roof was shot. The appraiser heard him and the loan under writer disapproved the loan.

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