Appraisal Question--Bugs you there?

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Submitted by Ricechex on October 17, 2007 - 3:39pm

Hello All,
I posted a couple of weeks ago, whether I should buy out or sell a house I own with another person. I appreciate all your feedback, and I am still unable to make a decision.

If I do attempt a buy out from the other owner, I will need an appraisal. We had the house appraised in Dec 06, and the co-owner chose the appraiser. I told the appraiser about the various problems with the house (water disclosure) which I assumed would decrease selling price, and thus, the appraisal value. She told me she had nothing to do with that, tell it to a realtor.

When we received the appraisal, there were some gross errors in attention to detail, AND I thought the appraisal was about $20K too high, even WITHOUT considering the disclosure.

So, my questions are:
1) Should the appraiser be considering disclosures in their assessment of the property?

2) Bugs, if I need an appraiser in the next few months can you do it?

Submitted by Bugs on October 17, 2007 - 6:19pm.

So, my questions are:
1) Should the appraiser be considering disclosures in their assessment of the property?

2) Bugs, if I need an appraiser in the next few months can you do it?

The answers here are:

1) Yes, an appraiser is supposed to consider whatever information they come across regardless of its source; and to the extent that it would affect the value those items are worth noting in the report and considering in the valuation itself. Sometimes we're given information that's basically irrelevant - that type of information doesn't always make it into a report. Other times we're given information that may have some bearing on marketability but not the value itself; that type of information might make it in the report even if we don't do anything else with it. It all depends on the situation.

2) Sorry, but I don't think it would be appropriate for me to accept a paying assignment off of this board. There are a couple reasons for this, one of them being I'd like to avoid mixing my business interests with my participation on this board.

But there are other reasons, too. Banking regulations prohibit a lender from using an appraisal wherein the appraiser was selected or engaged by any party other than the regulated institution or its agent.

I do appreciate the thought, though. If you do get an appraisal and you want to get an opinion on how good the work is or you want a second opinion that's something I'd do for another Pigg gratis.

Submitted by Ricechex on October 17, 2007 - 8:04pm.

Thanks Bugs. I appreciate your boundaries in this matter. Just to let you know....this would not be an appraisal for a bank. It would only to be to establish a price, so I can make a buy out offer to the co-owner.

Any chance you could make a referral to a decent appraiser? The lady we had did not do a very good job, and I was suspect of her by her attitude and indifference. I hate to cold call on this one.....

Submitted by sdduuuude on October 17, 2007 - 9:44pm.

Here is a sure-fire fair way to resolve dissolving partnership issues:

Step 1: Flip a Coin and determine a "winner" of the coin flip. (any game of chance will do).

Step 2:
The person who loses the coin flip must choose a price for the house.

Step 1:
The person who wins the coin flip decides if they wish to buy or sell at the price set by the person who lost the coin flip.

Submitted by Bugs on October 17, 2007 - 10:35pm.

If and when you're ready to get an appraisal just lemme know and I'll send you a couple names to choose from. I know a lot of appraisers and among those appraisers I know some really great appraisers.

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