The following excerpts are reprinted with the permission of Ann O'Rourke, MAI (Appraisal Today) and the author Douglas G. Smith. - Download Total Solution 1004MC Software Review - Doug Smith
Appraisal Today [April 2009] - Editor's note: Before writing this article, Doug Smith researched the available MC form software. He decided that David Braun's software was the best. This review also includes comments on the two appraisal "camps" on market conditions analysis and other topics. The MC form does not require historical listing data analysis, but Smith reviewed this as it is an option.
"The purpose of this addendum is to provide the lender/client with a clear and accurate understanding of the market trends and conditions prevalent in the subject neighborhood. This is a required addendum for all appraisal reports with an effective date on or after April 1, 2009."Fannie Mae 1004MC/Freddie Mac 71 March 2009
Although announced to the appraisal/lender world in November 2008, appraisers are only now scrambling to take steps to fully understand the new 1004 Market Conditions Addendum and devise a strategy to complete the form. Most agree completion of the Addendum will add to the work of preparing reports. Some lenders, in anticipation of the deadline, have asked that appraisers submit the completed form prior to the April 1, 2009 date.
While some lenders have stepped forward assuring appraisers they will be compensated for preparing the new Addendum; others have taken the stance that the Addendum only formalizes data that should already been gathered and analyzed and no increased fee should be expected.
That the information on the Market Condition Addendum is segregated into three distinct time periods refutes the contention that appraisers already gather the data required by the form in a similar fashion.
Whether an appraiser gathers and analyzes data on an annual basis or month-by-month, the current separation into one six month period and two three month periods requires re-working of any past methods of reporting trends.
It is clearly evident that preparation of the new MC Addendum will take more time. For appraisers, the challenge is two-fold.
First the appraiser must meet the competency standards of the scope of work necessary to complete the form and secondly the appraiser must consider the preparation time and productivity issues of meeting these requirements. To address both of these challenges,
David Braun MAI,SRA from Automated Valuation Technologies, Inc has developed Total Solutions©, a software program to assist appraisers with the process of preparing the 1004MC form. Total Solution© is both an elegant and practical time-savings means to competently fulfill the entire range of requirements of the new 1004MC Form.
Priced at $149.00, it is available at http://www.scoopgear.com and is available in two versions, one running on Excel 2007 and another geared for Excel 2003. David's AVT Users Group is located on The Appraiser's Water Cooler social networking site.
Click here to continue reading . . . .
Appraisal Community Divided
From debates on public forums and discussion held at recent seminars, it has become apparent that the appraisal profession is sorting down into two camps.
Both have considered and evaluated the information distributed by Fannie Mae and from this information have come to differing conclusions.
The main group has concluded that ordinary and customary information gathering is required with a focus on existing capability of local data sources mostly derived from Multiple Listing Services. This group holds that Fannie Mae's intent does not require the appraiser prepare extensive spread sheets, graphs or charts. Fannie Mae has strengthened the case for these appraisers. Recently, when the form itself was revised, instructions included less emphasis on past listings if these listings were not readily available in the data provided to appraisers.
The second group of appraisers, the "quants",typically comfortable with differing levels of quantitative analyses, emphasizes the obligation to prepare supported conclusions. These appraisers advocate the use of spreadsheets, charts and graphs to support their conclusions, not only for the specifics of the form itself, but to assist in handling the larger question of neighborhood trends required of the parent form whether it is the 1005, 2005 1025 or another. For those appraisers who make the claim that data is not available, the "quants" are quick to remind that these appraisers must face the consequences if their reports are later reviewed and the data is found to be readily available.
David Braun with his Total Solution © Software has carefully weighed the opinion of both groups and offers a solution that focuses on the outcome of the analysis rather than the process. His premise is simple, "If there is means to simplify and competently complete the scope of work to prepare the Market Condition Addendum, why not utilize this capability?"
Click here to read the FULL Doug Smith Total Solution © Software Review - Download Total Solution 1004MC Software Review - Doug Smith
SPECIAL THANKS! to Ann O'Rourke of Appraisal Today for suggesting that portions of her April 2009 Appraisal Today newsletter be reprinted here.
About The Author: Doug Smith has an appraisal practice in Butte, Montana, and is a certified general appraiser doing both residential and commercial appraising. He can be contacted at [email protected] .
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