“Flavors” of Appraisal Reports
Appraisers, recent watercooler discussions by appraisers focus on the new ‘desktop’ appraisals many will be requested to do.
Now that the GSE’s have “formally” approved non-appraiser-inspected reports for first mortgage lending (or will very soon – not sure of the exact effective date), you may want to actually SEE the differences between the THREE versions of the 1004 reports, what I euphemistically call “flavors.”
I spent a number of hours at the end of January reviewing our current ‘full’ 1004 form, and the new 1004 (Desktop) plus the 1004 (Hybrid) forms, which ARE in your software package NOW, to see how they compare and differ.
I encourage you to print out each form version for your file. And also print the table below showing the differences between them.
Once you understand the “flavor” differences and reporting protocols, you will then be in a better position to choose to do assignments with one of these two new “flavors”, or not.
Report Comparisons – based on Forms Scope of Work, Assumptions and Limiting Conditions, and Certifications
|Current 1004 URAR / 70||1004 (Desktop) / 70D||1004 (Hybrid) / 70H|
|Subject Inspection by||The Appraiser or Trainee Appraiser; complete visual inspect of exterior & interior||Apparently anyone of appraiser’s choosing using any method which provides necessary details, photos and floor plan; ‘Workforce’ not ID’d on form page 3 but ideally should be named in the report||Lender engages Inspection person who uses a Property Data Collection Report, to include a Floor Plan and photos; ‘Workforce’ ID’d on form page 3|
|Subject Home Diagram||Sketch ‘provided by appraiser’ including exterior wall dimensions (interior wall partitions not required unless adverse design problems found at time of inspection)||Floor Plan including exterior wall dimensions and interior wall partitions included in their locations; source for this can be owner, borrower, sales agent or other person using phone app, or any other data source||Floor Plan – completed as part of the Property Data Report given to appraiser (same details as Desktop)|
|Subject property data sources||Public and/or Private data records; appraiser inspection||Public and/or Private data records||Interior and Exterior Property Data Collection Report|
|Appraiser’s reliance on data sources||Assumes Public and/or Private data sources are ‘reliable’ without stating guarantees about data accuracy||Assumes there are no “Material Omissions”; no guarantees about data accuracy; reliance on third-party data sources||“Material Omissions” not mentioned; no guarantees about data accuracy; reliance on the Property Data Collection Report|
|Comp & Neighborhood Inspections – from at least the street||By Appraiser or Trainee; in Scope of Work||Neither required||Neither required|
|Report Intended Use||First mortgage loans, Second Mtg, HELOC, FHA, VA, USDA||First mortgage loans No notices yet from other ‘agencies’ about adopting this report||Unsure – 1st Mtg loans? No notices yet from other ‘agencies’ about adopting this report|
|Intended User; who may ‘rely’ on report||Lender/Client; Certification #23||Lender/Client; Certification #23||Lender/Client; Certification #23|