P.A.R.R. Review VS Appraisers USPAP Review

We would like to shed a little light on the difference between a P.A.R.R. Review and a USPAP (Uniform Standards of Appraisal Practices) Compliant Reviews performed by a Licensed Appraiser.

It should be noted that P.A.R.R. Review Specialists are not Licensed Appraisers. We can not offer an alternative opinion of value. We can however point you in the right direction should your need be to have a USPAP Compliant Review completed by a Licensed Appraiser. According to many Appraisers we are not allowed to form an opinion on if we agree with a value or not because they feel that only Licensed appraisers are allowed to "Review" Appraisals according to the laws as they interpret them. However, because we are not Licensed Appraisers, we are not governed by the same rules and regulations as "Licensed Appraisers" are. Therefore in our opinion working for the Borrower, we are unregulated. However, in order to not cause problems within the appraisal community, we will not indicate in words an opinion of the appraisers estimate of value however we will still provide any additional data that we feel may be relevant to your appraisal and it's value. What conclusions you form of the data we provide vs. the data the appraiser has provided is up to you.  As Bank reviewers we ordered and received Reviews daily from appraisers and it is very rare that one appraiser would blow the "Value" Whistle. But we also noticed that if good alternate comparable data was presented to an appraiser it is really no challenge to get the appraiser to alter their opinion of value. The problem is that the alternate data you provide them must be accurate and verifiable before they will consider it and for good reason, everything in their report must be able to be confirmed accurate by anyone.

With all that being said, there are some very large differences between a P.A.R.R. Review Report and a USPAP Compliant Review.

From Our experience, the Appraisers review is going to consist of a checklist of between 36-44 questions and some of the forms they use leave no room for commentary on the different items reviewed. The P.A.R.R. Review Checklist asks 105 questions which basically walks you from the beginning of the appraisal to the end. We indicate either a Red, Yellow or Green flag. These designations we find easier to understand than Acceptable, Unacceptable or N/A as provided on appraisers review forms. If there is a Red Flag we will provide proof of why the item was red flagged and if the item is Yellow Flagged we will in some cases provide proof of it being incorrect but yellow flagged items are of concern but would probably not impact the value or credibility of the appraisers report. Green Flag are indicated if no issue is found but in every case a comment would be provided in the comment area of that line indicating what was found.

At the end of some Appraisers Review forms is a place to indicate an alternate opinion of value. Most appraisers don't complete this area because it would require them to complete a separate grid of alternate comps for which the value is based.

At the end of a P.A.R.R. Review Checklist you will find a place for the reviewer to draw all the 105 previously made comments together and to comment on any alternate data located. In this comment section the reviewer will indicate if the appraisers opinion of value appears to be accurate or if there are issues that would question the integrity of the report.

Following the P.A.R.R. Checklist, we will provide copies of everything we found in our verification process. If the P.A.R.R. Report is ordered you will also receive a copy of all comps found in the area through our subscribed data sources. If you are in a Rural Area the comps will be scarce but we will provide what we can find. This is an important step so we can learn if the comps provided in the appraisal were the most similar, closest in proximity and the most recent sales available. If there are better comps found that would indicate a higher or lower value than those provided we will indicate this in the comments on the Checklist as well. We will also provide a flood cert for verification purposes and if the subject appears to be in a flood we will do what is possible to confirm this.

So, there is a big difference between an Appraisers USPAP Compliant Review vs The P.A.R.R. Checklist and Report but the biggest difference is yet to come.

Most Appraisers charge $150.00 - $300.00 for their work and can take up to 3 days to get it back. P.A.R.R. Charges $20.00 for a Basic Review (Basically the checklist and confirmation of the data in the appraisal) or $50.00 for the P.A.R.R. Report and guarantee a 24 Hour Turn Time.

Let us make sure your appraisal is Up to P.A.R.R.

On-Line Valuations

This is a very interesting video by a new friend of ours Greg Cooper, who is an Indiana Realtor. He makes some very interesting and very important points regarding on-line home valuations. Anyone wanting to know the value of a property should watch it.

The scary part of this that he doesn't touch on is that Banks often times use on-line valuations to gauge the accuracy of the appraisal reports the Appraisers send them.

He points out that the valuations available on-line are computer generated and have no understanding of local markets. At P.A.R.R. we have seen these valuations be as much or more that $100,000.00 less than a recent sales price of a home.

Please watch the video.

http://www.wthr.com/category/239154/real-estate-update

Thank You for Reading.
P.A.R.R.

Service Feedback

Mr. & Mrs. Flack
Princeton, WV.
We really enjoyed doing business with you. We felt that you made it easier to understand how the appraisal works. The step by step direction on what the different terms are helped me to see what my house value came in at. It was a pleasure doing business with you and will again in the future.

What's in a Value?

To some in the Real Estate Business the Appraisers estimate of value is just a number.
But to the Borrower that number can mean a lot. It can mean the difference between
being able to buy a home or not.  It can mean that they may not be able to borrow as
much as they could or that they are borrowing to much on a refinance.

Recently an acquaintance of P.A.R.R.'s Founder came to him and said that she has been
trying to sell her home now for well over a year.  Her area is not a declining market but
she can't seem to get any buyers even though she has the home listed for less that the
appraisal value the last time she refinanced her home.  The only offers she has gotten
are actually less than her loan amount. 

His advice to her was to wait it out and that perhaps in a more active Spring and Summer
market she will get more offers that are closer to the asking price.  In reality, what will
probably have to happen is that eventually, she may have to come to the closing table
with cash just to sell the property or have to let it go back to the bank.  What caused
this problem?  P.A.R.R. didn't review the appraisal so we can't say for sure that the
appraisers estimate of value was inaccurate at the time the appraisal was performed but
it would sure seem as if the appraisal was over valued.  It is also not known when the
appraisal was performed which could make a big difference in what it is worth today.

Regardless, it pointed out to P.A.R.R.'s Founder, the importance of the accuracy of the
appraisal and the appraisers estimate of value. 

So, What's in a Value? For borrowers it can mean the health of their financial future.
For Banks it can mean the difference of getting their money back or loosing it in a
foreclosure.  If the appraisal is contested in court, it could mean the appraisers livelihood.
For the Loan Officers or Realtors who make the deal, it means absolutely nothing other
than how much commission they can receive once the sale or refinance closes.

Be an Informed Consumer.         Make sure your Appraisal is Up To P.A.R.R.

Questions & Answers

Welcome to the Check My Appraisal and P.A.R.R. Blog. Please feel free to ask
any questions regarding your appraisal and your rights to review it. 

 

Question: My Banker gave me a form to waive my right to a 3 day review of my 

appraisal.  What is this and should I sign it?  

 

Answer: Regarding your right to receive or waive your appraisal 3 days prior to 

closing, we have seen several questions regarding this issue on the internet and 

want to inform you that there are several possible answers that could be correct 

for your situation.

 

There are several factors that should be taken into consideration when making 

this decision and several questions you should ask before signing your right to 

review away.

 

1. When does my Interest Rate Lock expire and can it be extended, if yes at what 

cost?  Typically they can be extended but some lenders do charge a fee for it and 

others don't.

 

2. When does the Purchase Contract expire?  If you placed a clause in the 

contract that the home must appraise for at least the contract price then it really 

doesn't matter. If it comes in lower than the contract price the contract is void 

and more negotiations have to take place anyway. 

 

Once a new contract price has been negotiated all of the banks documents have 

to be reworked regardless.  Unless the seller is under some unusual time pressure the 

contract expiration date can usually be extended. We have seen it happen that the
sellers have other offers on the table and by not extending the date can keep your
earnest money (Deposit) and go with another offer.  So discuss this with your Realtor 

and inform them that you want to review the appraisal before you close the loan.

 

Please keep in mind that under normal circumstances a loan doesn't close within 

three days of the appraisal being received anyway. Many lenders won't even schedule 

a closing until the appraisal is received so in most normal cases there is no reason to 

waive the 3 day right to review. 

 

At P.A.R.R. we feel that there are very few valid reasons to waive the government 

mandated 3 day right to review. Regardless if you have us review your appraisal 

or you do it yourself, the government is trying to make sure that you are completely 

aware of the transaction you are about to make. If you waive that right and 

something turns up later then you have no recourse. 

 

Remember, by giving you three days to review your appraisal, the Government 

has placed the quality of that appraisal in your hands. You are now responsible 

for it and if you waive your right to review it you also waive your right to 

contest it if there are problems with it.

Thank you for your Visit.

P.A.R.R. Is hoping to become the advocate for the borrower when it comes to their Mortgage Appraisal. Please feel free to contact us if you have any questions regarding an appraisal you have received. You can contact us here or through our website. We have several videos that we also hope will be informational as well.

Thanks
P.A.R.R. Founder