Harrison’s Illustrated GuideHow to Make an FHA Single Family Appraisal - 2015 Editionby Henry S. Harrison, MAI, RM, ASA, DREI
New Collegiate Publishing Company
320 Pages, Soft Cover; Price $59.95
In March 2015, HUD/FHA announced the publication of two new books: the “FHA Single Family Housing Appraisal Report and Data Delivery Guide” and the “FHA Single Family Housing Policy Handbook 4000.1.” These two publications represent a major revision of the old FHA Appraisal Requirements. The Single Family Housing Appraisal Report and Data Delivery Guide was specifically produced for appraisers and the 4000.1 handbook was published for both lenders and appraisers. Altogether, the publications provide over 500 pages of complicated material with no index.
Appraisers who are trying to use these two new publications soon discover there are hundreds of requirements labeled “the appraiser must” that are not covered in the “FHA Single Family Housing Appraisal Report and Data Delivery Guide.” As he did in his popular URAR Guide, noted appraisal author and educator Henry S. Harrison has organized this material in a new line-by-line URAR guide — focusing on these new FHA requirements. For example the “appraiser must” inspect the attic, only the 4000.1 Handbook states: “If unable to view the area safely in their entirety, the appraiser must contact the Mortgagee and reschedule a time when a complete visual observation can be performed, or complete the appraisal subject to inspection by a qualified third party (FHA 4000.1Handbook Page 445).” Mechanical system requirements are another “FHA requirement” that is not covered in the Single Family Housing Appraisal Report and Data Delivery Guide. “The appraiser must not include the value of leased mechanical systems and components in the Market Value of the subject property. This includes furnaces, water heaters, fuel or propane storage tanks, solar or wind systems (including power purchase agreements,) and all mechanical systems and components that are not owned by the property owner. The appraiser must identify such systems in the appraisal report. (FHA 4000.1 Handbook Page 440).
Harrison’s new Illustrated Guide makes accessing crucial information far easier for appraisers. It goes page-by-page through the URAR and MC forms, covering FHA and other requirements. The Model Comments sections of the book have been updated in this edition. By purchasing a copy of this guide, you obtain permission to use them as you wish. With this book you can easily find the pertinent FHA requirements for each line of the URAR and helpful information on how to complete the Market Conditions Addendum Form (MC) which is required for every FHA appraisal.
With this book you can easily obtain the FHA requirements for each line on the URAR form and helpful information on how to complete the Market Data Addendum Form which is required for every FHA appraisal.
To purchase Harrison's Illustrated Guide How to Make an FHA Single Family Appraisal 4000.1 - 2015 Edition, you can buy it, along with hardcopies of both the FHA 4000.1 Handbook and FHA Single Family Housing Appraisal Report and Data Delivery Guide directly from Henry S. Harrison's publisher New Collegiate Publishing. http://www.newcollegiatepublishing.com.
When do the new HUD-FHA regulations become effective?
Answer: They were supposed to be effective 6/15/2015. The effective date has been postponed until September 14, 2015.
If mortgagees are ready to implement on June 15, will they be allowed to submit cases that use the SF Handbook on or after this date?
Answer: No. Mortgagees must submit cases that use existing FHA policy until the new SF Handbook becomes effective on or after September 14, 2015.
Will FHA publish a “Highlights of Changes” document that summarizes the policy changes contained in Origination through Endorsement?
Will you publish a new “Harrison’s Illustrated Guide – How to Make an FHA Single Family Appraisal”?
Answer: Yes! I am working on now and plan to have it available in early August. You can make a publication order from Forms and Worms 1-800-243-4545 or www.formsandworms.com. Pre-Order and Save 10%! Pre-order price of $44.95 for orders placed before 9/14/2015. Regular price $49.95
Valuing Contaminated Properties-An Appraisal Institute Anthology Vol. IIEdited by Richard J. Roddewig, MAI, CRE
American Institute of Real Estate Appraisers
Chicago, Il, 60607
500+ Pages, Soft Cover; Price $75 (AI price $60
My first reaction to this book was “wow it is big and heavy!" In this day of Google and the Lum Library, who needs to spend money on an Anthology when you can get a custom made bibliography from the Lum Library (312-335-4467). That being said, in my view, an appraiser should not even think about making an appraisal of a contaminated property until they are familiar with the Appraisal Foundation Advisory Opinion AO 9 which is covered in Chapter 1.
Chapter 1, USPAP and the Appraisal of Properties Impacted by Contamination or Environmental Risk, starts with a five page introduction by the editor. It points out, for example, “The distinction between source sites, non-source sites, adjacent sites, adjacent sites and proximate sites is one of the topics covered by AO-9." By the time I finished reading Chapter 1 I was mentally exhausted.
Chapter 2, The Recognized and Generally Accepted Methods for Appraising Property Affected by Contamination and Environmental Risk, starts with another five page introduction by the editor.
After reading and digesting these two chapters, I realized it is not necessary to read the rest of this book as it is an Anthology with 67 articles, divided into 10 chapters, covering many topics. For example, article 10.2, How Australian Appraisers Assess Contaminated Land, will have limited use to most appraisers.
Whereas, chapter 7 consists of 17 pages across 5 articles all of which cover the subject of Mold — A topic which all appraisers should be knowledgeable.
Summary: This Anthology is a definitive compilation of accepted appraisal knowledge written by many authors, selected and interpreted by the editor, who is a valuation expert. If you make or are planning to make appraisals of contaminated property, the cost of this book is a small price to pay for a valuable reference to help you improve your work.
It took the FHA 16 years to replace the long ago outdated FHA Handbook 4155.2 and 4150 (Chapter #4). At that time I wrote a book “How to Make An FHA Single Family Appraisal.” All of that is now history as HUD-FHA has issued two new books that make the old ones and most of the Mortgage Letters obsolete. This is not surprising since a lot has changed in 16 years. Unfortunately, these two new books do not clearly indicate what is new and what is unchanged. This is the first of several articles that will point out some of these changes.
HUD-FHA New Handbook 4000.1 (FHAHB4000.1) and FHA Single Family Housing Appraisal Report and Data Delivery Guide (SFHAP&DDG)
These two handbooks were released on March 18, 2015 to be effective June 15, 2015. Late in April in response to many complaints the effective dates were advanced to September 14, 2015.
NOTE: NONE OF THE MATERIAL IN THIS ARTICLE SHOULD BE USED BEFORE THE NEW HUD-FHA HANDBOOK GOES INTO EFFECT.
Many of the changes are covered in the new FHA Single Family Housing Appraisal Report and Data Delivery Guide (SFHAP&DDG). However, FHA HB 4000.1 covers most of the other types of property that are insured by the FHA.
Environmental (page 391):
The Mortgagee must require corrective work to mitigate any condition that arises during construction that may affect the health and safety of the occupants, the Property’s ability to serve as collateral, or the structural soundness of the improvements.
Comment: The Lender cannot do this unless that appraiser supplies this information in the Site section of the URAR among other options.
Lead-Based Paint (page 71):
Comment: There is new emphasis on what steps lenders must take when a building is built before 1978. However, the appraiser should keep in mind that some houses built after 1978 still might contain lead paint as paint that was stored (often for many years) containing led was used after 1978. Therefore the appraiser should consider using a standard comment in their appraisals that the appraiser did not inspect the property for lead paint contamination
Pre-Foreclosure Sales (Short Sales) – Definition (Page 121):
Pre-Foreclosure Sales, also known as Short Sales, refer to the sales of real estate that generate proceeds that are less than the amount owed on the Property and the lien holders agree to release their liens and forgive the deficiency balance on the real estate.
Stationary Storage Tanks (Page 431):
The Appraiser must notify the Mortgagee of the deficiency of MPR or MPS if the subject property line is located within 300 feet of an aboveground or subsurface stationary storage tank with a capacity of 1,000 gallons or more of flammable or explosive material. This includes domestic and commercial uses as well as automotive service station tanks.
Proximity to High Pressure Gas Lines (Page 430):
The Appraiser must identify if the dwelling or related property improvement is near high-pressure gas or liquid petroleum pipelines or other volatile and explosive products, both aboveground and subsurface. The Appraiser must determine and report the marketability of the Property based on this analysis. The Appraiser must notify the Mortgagee of the deficiency of MPR or MPS if the Property is not located more than 10 feet from the nearest boundary of the pipeline Easement.
FHA Bailout Imminent?
by Henry S. Harrison
The FHA was founded as a government agency as part of the National Housing Act in 1934. For the first time since its creation, it may require a financial bailout from the U.S. Treasury (a.k.a. the U.S. tax payers) so I thought it would be worthwhile sharing my understanding of the FHA and shedding some light on the looming bailout.
The tow major goals of the FHA is to (1) improve housing standards and conditions and (2) provide an adequate home financing system through insurance of mortgage loans. Another goal stated in the National Housing Act of 1934 was for the FHA to help stabilize the mortgage market. The Commissioner of the FHA is Carol Galante.
Historically, the FHA has done much more than insure single family houses. In 1935, Colonial Village in Arlington, Virginia was the first large-scale, rental housing project erected in the United States that was Federal Housing Administration-insured.[During World War II, the FHA financed a number of workers housing projects including the Kensington Gardens Apartment Complex in Buffalo, New York]. It also insured nursing homes. Currently, the FHA has about 4.8 million insured single family mortgages and 13,000 insured multifamily projects in its portfolio.
While a government agency seeking more funding isn’t exactly unheard of, the FHA is required by Congress to keep enough cash on-hand to cover expenses at all times. The initial estimates as to how much the FHA might require in taxpayer assistance are said to be around $943 million, according to the Boston Herald. The nearly-$1 billion dollar bailout would be for loans insured by the FHA that were posted as losses. Sen. Susan Collins (R-ME) stated, “It's of great concern to us.”
The FHA has until Sept. 30 to make a decisions as to whether or not they’ll actually require the money in order to continue operation. The Treasury, which does not require Congressional approval, would be providing the bailout which means it would be paid for by the taxpayers.
There has been suggestions that the FHA take over the running of Fannie Mae and Freddie Mac. Can you imagine what it will be like if that happened?
Welcome to the Real Estate Valuation Magazine Online Fall 2013 Issue.
We did not run a Summer 2013 issue of the magazine because this summer has been a difficult time for me. In May, I was diagnosed with Shingles which penetrated my sciatic nerve, causing severe pain down my right leg and into my foot. For June, July and most of August I was wheelchair-bound because the disease affected my balance and walking was very painful.
I have taken the summer off to get well, and while I still have pain in my big toe, but I am relieved to report that I am feeling better and stronger every day. The road to recovery is long, but my condition has improved enough that I feel confident returning to work at this time.
There have been many interesting developments in the appraisal field during the summer. After five years, we are still feeling the lasting effects of the foreclosure crisis. We are getting reports that the flow of appraisal work is slowing down after a bit of an up swing this past spring and summer.
There has been a lot of discussion recently about Life After Fannie Mae and Freddie Mac, so the editorial of this issue takes a closer look at the Rise and Fall of these two agencies. While some people are calling for the FHA to take over Freddie and Fannie, I am more concerned that FHA may also needing a financial bailout.
Speaking of the FHA, any appraiser who is doing FHA appraisals needs a laundry list of publications (nearly 350 pages in total). While these documents are available across the FHA website. I personally find the FHA website to be abysmal to navigate. Given how cumbersome it is to download these documents individually, I have compiled all of these resources into a packaged set available for purchase today!
With that introduction, we hope you will enjoy the Fall 2013 Issue of the magazine. Our son, H Alex continues to be actively be involved with producing the magazine as our editor. As always, if you have appraisal questions, please feel free to email me at firstname.lastname@example.org. For technical issues or other general questions regarding REV, or our website, please email our editor, H Alex Harrison at email@example.com.
P.S. For information about free listings and advertising in our publications email: firstname.lastname@example.org
Photo credit: Fresh Home.
Compiled by Henry S. Harrison, MAI, ASA, IFAS, DREI
Vol. 1 & Vol. 2 Combo Set • $67.50 + S&H
Publication Date: 2013
Any appraiser doing FHA appraisals needs to have a copy of "FHA Handbook HUD-4150.2" and Chapter 4 from FHA Handbook 4155.2 (only chapter 4 apples to appraisers), the 28 mortgage letters that update the Handbooks and the over 150 of the Frequently Asked Questions supplied by the FHA to help understand their publications.
I want to take this opportunity to share with you my experience in compiling these two FHA Handbooks. While this information is available free of charge from the FHA site, downloading it all is a nightmarish undertaking.
My first plan was to combine this updated 2013 material into one book as I had done in the past. Unfortunately, the FHA has expanded this material so much that it will no longer fit into one volume using my printer – the same printer I have used for many years to print my books because of their good quality, fair prices and reliable delivery time.
If you would like to get a free copy of the FHA Handbook HUD-4150.2 by downloading it from the FHA site here is what you do:
1. Go the the FHA site at www.fha.gov
2. Click on the left hand column under Audience Groups click on "Appraisers"
3. Click on the left hand column under Find Answers click on "Mortgagee Letters and Handbooks
4. Click on the right hand column under Reference Materials "Handbook HUD-4150.2
Here is where I ran into trouble. On this page there is a choice of downloading the handbook as a word fillable form or a PDF version. I could not get the "word fillable form" version to work so I resorted to downloading each of the individual nine PDF files. The result is a manual of about 350 pages.
Unfortunately, this is not all you need. You also need to download from the lenders handbook "Chapter 4 "Property Valuation and Appraisals" from HUD Handbook 4155.2. The subjects of interest to appraisers in this Chapter 4 are as follows:
- the purpose of property valuation
- lender responsibility for appraisers
- appraisal management company (AMC) and third party organization fees
- verification of compliance with property requirements
- lender responsibility for determination of property eligibility and accuracy of appraisal value
- variation in property appraisal and underwriting process
- property eligiblity for FHA insurance
- property eligibility under section 223 (e)
- compliance inspection requirements
- appraisal assignment to ensure appraiser competency
- preventing improper influences on appraisers
- prohibition of mortgage brokers and commission based lender staff from the appraisal process
- appraiser independence safeguards
- appraiser selection in the FHA connection, and
- DE underwriter responsibility for quality of appraisal report.
If you would like to get a free copy of the FHA Handbook HUD-4155.2 by downloading it from the FHA site here is what you do:
- Go the the FHA site at www.fha.gov
- Click on the left hand column under Audience Groups click on "Appraisers"
- Click on the left hand column under Find Answers click on "Mortgagee Letters and Handbooks"
- Click on the right hand column under Reference Materials "Handbook HUD-4150.2"
The FHA Handbooks are now over four year old and there are 28 mortgage letters that have been issued. All of them are needed to update these FHA Handbooks. Instead of issuing a new edition of their publications, the FHA has issued 150 FAQs that update the texts:
- HUD ML 2012-23: Loan Origination Procedure Q&A: 4 pages
- FAQ: Natural Disaster Protocols: 1 page
- FAQs UAD and Other Appr Forms ML 11-30: Special FHA UAD requirements
- L 11-07 Elimination of Master Appr Rpt.: When case numbers can no longer be assigned
- FAQs Declared Disaster Area ML 12-23
- ML 12-23 Declared Disaster Areas: Included with mortgage letters
- FAQs Disaster Loans Before 11/16: FAQ; Natural Disaster Protocols, 1 page chart
- FAQs UAD and Other Appr Forms ML 11-30: Special FHA UAD requirements
- ML 11-07 Elimination of Master Appr Rpt,: When case numbers can no longer be assigned
- FAQs Lead Based Paint:Clarifies who can inspect for lead when the property was built before 1978
- FAQs Reasonable Fees/Time: Spells out the FHA's position on how reasonable fees are determined.
- FAQs Meth Remediation: Clarifies what to do when there is methamphetamine contamination
- FAQs Appraiser Valuation: 37 pages covering 16 subjects
- FAQs Appraiser Roster Link not active as of 8/8/2013
- FAQs , Update ML 09-51: Claries by whom and when an update report may be prepared.
- FAQs Appraisal Portability ML 09-29: Clarifies whom and when a second appraisal report is required
- FAQs Appraiser Independence ML 09-28: 6 pages clarifying by whom and when fees can be collected.
The bottom line is this: Any appraiser who is doing FHA appraisals needs to have a copy of "FHA Handbook HUD-4150.2" and Chapter 4 from FHA Handbook 4155.2 (only chapter 4 apples to appraisers), the 28 mortgage letters that update the Handbooks and the over 150 of Frequently Asked Questions supplied by the FHA to help understand their publications. I have compiled these documents and sell them as a combined set with included CD-ROMs of all of the resources for your convenience.
The Complete HUD-FHA Combo Set is available from Forms and Worms 1-800 243-4545 or www.formsandworms.com for 25%-off when you buy the combination.
12/19/12 - The Federal Housing Administration’s Acting Commissioner, Carol J. Galante, announced Dec. 18 that she would implement substantial reforms to shore up the government mortgage program, which reported Nov. 14 that it was $16.3 billion in the red, Mortgage Daily reported.
The changes Galante will implement include limiting borrowers with credit scores less than 620 to a 43 percent total debt-to-income ratio. Borrowers with high debt-to-income ratios will be subject to manual underwriting and potentially to higher down payment requirements. The change is expected to cut claim rates by 20 percent.
The FHA also will eliminate its standard, fixed-rate home-equity conversion mortgages — a reverse mortgage program that allowed seniors to draw a large lump sum at closing, ranging from 62 to 77 percent of the property’s appraised value. Many seniors now are unable to keep up with payments and facing foreclosure.
Additional changes include reducing FHA market share by cutting loan-to-value ratios to 95 percent on loans greater than $625,000 and more closely scrutinizing borrowers with prior foreclosures.
“I've been working closely with (U.S. Department of Housing and Urban Development) Secretary (Shaun) Donovan and Acting Commissioner Galante over the past few weeks on ways we can put FHA on sound financial footing,” Sen. Bob Corker, R-Tenn., said in a news release, Mortgage Daily reported. Corker is member of the Senate Banking, Housing and Urban Affairs Committee. “While this is only a first step, I am encouraged that Acting Commissioner Galante has committed to structural reforms that we both believe put FHA in a much stronger position,” he said.
Read the full story here.
I completed an appraisal for Lender A. Then, Lender B called and said Lender A is OK with them using my report. Now I've been notified that Lender B's underwriter wants clarification on a couple of items, such as right of way and community water.
They don’t want client name changed. Can I do this and stay compliant with USPAP? Thank you in advance for your advice.
Carlene S Mathison
P.S. I did check with Lender A and was told it is okay to do this "because it’s an FHA assignment & FHA has mandated portability."
You are correct the FHA does permit the original lender to transfer the appraisal to a second lender under certain circumstances. Here is a summary of this ruling:
"Appraisal Transfer and Change of Client Name in Appraisal Report"
In cases where a borrower has switched lenders, the first lender must, at the borrower's request, transfer the case to the second lender. FHA does not require that the client name on the appraisal be changed when it is transferred to another lender.
In accordance with the Uniform Standards of Professional Appraisal Practice (USPAP), the lender is not permitted to request that the appraiser change the name of the client within the appraisal report unless it is a new appraisal assignment. To effect a client name change, the second lender and the original appraiser may engage in a new appraisal assignment wherein the scope of work is limited to the client name change. A new client name should include the name of the client (lender) and HUD.
There are a bunch of other requirements the lenders must comply with.
It is still my opinion that you are not required to do anything and in fact most anything you do will be treated as a new appraisal and you must comply with the USPAP requirements for making a new appraisal for which you should be paid.
I think you have a choice. Do nothing or tell lender B if they want you to do anything it will require you to make a new appraisal and you expect to be paid for it.
"The FHA Appraisal"
February 23, 2012
This FREE one-day class discusses FHA appraisal requirements including Appraisal Protocol, & updates to FHA appraisal policy, and equips attendees with the knowledge to determine property eligibility. (The earlier class, on Feb. 16th, is full.)
This course provides a refresher for seasoned FHA appraisers, as well as provides valuable information to appraisers new to the FHA roster. Prior Registration by Feb. 20th is required, but the course is free of charge.
Click here: FHA Class
July 27th, 2011
FHFA Sues UBS to Recover Losses to Fannie Mae and Freddie Mac
Washington, DC – The Federal Housing Finance Agency (FHFA), as conservator for Fannie Mae and Freddie Mac (the Enterprises), has filed a lawsuit in the federal district court for the Southern District of New York against UBS Americas, Inc., and related defendants alleging violations of federal securities laws in the sale of residential private-label mortgage-backed securities (MBS) to the Enterprises. FHFA seeks to recover losses and damages sustained by the Enterprises as a result of their investments in UBS Securities.
The lawsuit alleges that UBS Americas made numerous material misstatements and omissions about the mortgage loans underlying the private-label MBS, including the creditworthiness of the borrowers and the quality of the origination and underwriting practices used to evaluate and approve such loans. The defendants also failed to conduct adequate due diligence. This lawsuit seeks to recoup the losses suffered by the Enterprises related to their $4.5 billion investment in securities sold by UBS.
As conservator of Fannie Mae and Freddie Mac, FHFA is charged with preserving and conserving the assets of the Enterprises. Through this lawsuit and additional lawsuits expected to follow, FHFA seeks to recover losses suffered by the Enterprises in connection with the Enterprises’ investments in private-label securities.
“FHFA is taking this action consistent with our responsibilities as conservator of each Enterprise,” said FHFA Acting Director Edward J. DeMarco. “From the issuance of 64 subpoenas last year to the filing of this lawsuit and further actions to come, we continue to seek redress for the losses suffered by the Enterprises.”
The defendants named in the lawsuit are UBS Americas, Inc., UBS Real Estate Securities Inc., UBS Securities, LLC, Mortgage Asset Securitization Transactions, Inc., and former UBS executives David Martin, Per Dyrvick, Hugh Corcoran, and Peter Slagowitz.
Us 80 year old kids need to share our experience.
I recently received an FHA appraisal assignment on a single family house, from an appraisal management company and when I arrived on the scene I realized that I appraised, also on an FHA refinance, the house directly across the street in 2001. The value of the houses almost doubled in the 10 years in between.
My work to complete the appraisal, with 3 Comp sales (with current non-MLS pictures), 3 listings, interior pictures, market condition forms, etc, also almost doubled. When I pulled up the 2001 file, I found that I had received a fee of $400 for the old 2001 job. My fee for the 2011 appraisal was (drum roll): $400. WOW!
I found that the appraisal fee charged to the home owner was $750. (she offered the information) and asked why my fee which she assumed was the full $750 was so high? I could not find a reasonable answer except: "I'm sorry, I can't discuss it with you..ask your bank."
Reasonable fee solution: Since AMCs are here to stay, even though some states are now (or soon will be) requiring a license, the Feds and/or federal institutions should require the AMCs to pay the Appraiser 75% of whatever fee they charge the homeowner for the appraisal, and be required to show both parties and their fees, on the HUD1. The banks should NOT be allowed to own AMCs. This will stop the AMCs from shopping for the lowest fee and least experienced appraiser to do the job.
Maryland Certified General since 1962
Dear Mr. Harrison:
This is my first question for you. I'm a Certified Residential appraiser in MA and N.H. Can I just go to the govt. website to become FHA approved? Is it that simple? Could you advise me please? I enjoy your Revmag emails I receive.
Thank you in advance for your help.
John D. Devereaux
The FHA website: http://www.hud.gov/offices/hsg/sfh/appr/eligibility.cfm tells you in detail what you need to do to get on the FHA Roster of Approved Appraisers.
If that doesn't work, go to Google and enter the phrase "FHA Appraiser Roster". There is an application but is cannot be completed online. Your completed application must be submitted online, which means that you have to download the application and save it as a PDF, sign it and then scan it and send it back via email to the FHA.
Here are the highlights of the current FHA requirements:
1. You must be a residential certified appraiser or general certified appraiser.
2. You must NOT be listed on GSA's Excluded Parties List System (EPLS),
HUD's Limited Denial of Participation (LDP) list, or HUD's Credit Alert System (CAIVRS).
3. You must scan your state issued certification and send it with your complete online application.
4. Make sure that the ASC National Registry contains the correct information about your certification.
The $64-thousand dollar question is what happens next! Hopefully some of our readers will share their experience -- especially how long it took them to get on the FHA roster once they had applied.
Can an appraisal done as a USDA appraisal be switched to an FHA appraisal, or would the property have to be re-inspected?
Whenever the client changes, a new appraisal is required by the USPAP. This means that there must be a new scope of work dialogue with the new client. There are no USPAP requirements about inspections; therefore, if the effective date and inspection date are the same, I think you will just need to rewrite the appraisal being sure you have covered everything required in the new scope of work.
On an FHA purchase appraisal, after the inspection, in the normal course of conversation with the home owner I was asked if there were any problems with their home. I stated that there were three problems that needed to be addressed, without going into the details of the problems. I told the homeowner that these issues needed to be addressed before the home could transfer title. By the time I got back to the office, the mortgage broker was on the phone telling me these issues did not exist. He called the appraisal management company and tried to cancel the appraisal. The appraisal management company then called me and told me that the appraisal was being reassigned because I disclosed information to an unintended user, and that I was in violation of USPAP rules. Did I really violate USPAP rules by answering a simple question honestly?
The USPAP requires that every appraisal report contain a statement as to who the intended User(s) are. If you stated that the intended user was the Lender/Client, then the only people you can discuss the appraisal with is the Lender/Client. If you stated that an intended user was the property owner or someone else, you could discuss the report with them. Generally, it is a good policy not to discuss your appraisal with property owners, as all it can do is get you into trouble. When asked a direct question about the appraisal or your inspection, I recommend that you politely say you are not permitted to discuss the appraisal with anyone other than the intended user and that the owner is free to contact them for information.