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Jack Schlenk's Blog

By Jack Schlenk | Appraiser in Chicago, IL
  • Chicago Zip Code 60641 values 2006 & 2013

    Posted Under: Home Buying in Chicago, Home Selling in Chicago, Foreclosure in Chicago  |  September 13, 2013 10:06 AM  |  1,473 views  |  No comments
    Values in 2006 versus values in 2013

    2006 Detached Single family
    314 sales, Average sold price $387,917

    2013 Detached Single family
    342 sales Average sold price $254,951

    Average decrease in value $132,966 or 34.28%

    2006 Attached Single family
    273 sales, Average sold price $223,283

    2013 Attached Single family
    157 sales, Average sold price $104,600

    Average decrease in value $118,683 or 53.15%

    2006 Two - Four unit buildings
    178 sales, Average sold price $464,950

    2013  Two - Four unit buildings
    158 sales, Average sold price $213,545

    Average decrease in value $251,405 or 54.07%

    Question; were the 2006 sale dollars supported by market values at that time?

    To review an Appraisal Report in the present and or in the past please contact;

    Jack Schlenk,  email jack327@sbcglobal.net



  • Subject Hypothetical Market Values

    Posted Under: Market Conditions in Chicago, Home Buying in Chicago, Foreclosure in Chicago  |  September 6, 2012 11:31 AM  |  1,850 views  |  No comments
    Market Values based on the subject market data, The reader is to fill in the data where noted.

    The subject prior sale was (date) @ (dollars). It is assumed the subject's sales price was supported by the market data in the time period (date).

    Subject Hypothetical Market Values

    Attached, Single Family, 2-4 units in MLS (number or area)
     # sales, subject date of market data, $ Low - $ High, avg $, median $, dom  
     # sales, date todays market data, $ Low - $ High, avg $, median $, dom

    Ratio's  Average %    Median %

    Based on this market data the subject's present estimated values would be
     subject prior sale price X Avg % =$Value, Subject prior sales price X Median % = $Value

    Same formula for the subject's type of property.

    Same formula for the subject's type of property and the number of bedrooms and baths.

    The ratio's average and median percents times the subject prior sales price may help support
    the subject present value opinion, and or support or not support the subject prior market value opinion.

    A good appraisal report will have a hypothetical scenario and data to support the value opinion in the appraisal report.

    It the appraisal report lack data to support the value opinion and statements it may not be a creditable report.  

    Jack Schlenk
    Illinios License(s), Certified RE Appraiser & Managing RE Broker
    773 685 8300 jack327@sbcglobal.net
  • FORECLOSURE APPRAISAL REVIEW

    Posted Under: Market Conditions in Chicago, Financing in Chicago, Foreclosure in Chicago  |  August 10, 2012 9:20 AM  |  1,934 views  |  No comments
    Foreclosure Appraisal Review - The Check List

    Why;
    Did the Lenders Appraisers make the number?
    Did the Lenders Appraisers inflate the propertes value?

    Did the Appraisal report meet the USPAP GUIDELINES?

    SCOPE OF WORK RULE
    1. Identify the problem to be solved;
    2. determine and perform the scope of work necessary to develop credible
    assignment results; and
    3. disclose the scope of work in the report

    Problem Identification;
    An Appraiser must gather and analyze information about those assignment elements that
    are necessary to properly identify the appraisal problem to be solved.

    Scope of Work Acceptability;
    The scope of work must include the research and analyses that are necessary to develop
    assignments results.

    An appraiser must be prepared to support the decisions to exclude any investigtion,
    method,or technique that apprear relevant to the client, another intended user, or
    appraisers's peers.
    An appraiser must not allow the assignment conditions to limit the scope of work.
    An appraiser must not allow the intended use of an assignment, or client's objectives to
    cause the assignment results to be biased.

    Thev Appraisal report must contain sufficient information to allow intended users to
    understand the scope of the work performed.

    If your Appraisal report did not meet the above USPAP Guidelines your Appraisal
    report may not be credible. Therefore the Appraisal report value opinion may not be
    support by your market values.

    Contact me if you need or want a review of your appraisal report.

    Jack Schlenk, Consultant
    IL License's RE Certified Appariser & RE Managing Broker
    773 685 8300, jack327@sbcglobal.net
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  • Re- Finance Appraisal Red Flag#3

    Posted Under: Market Conditions, Home Selling, Foreclosure  |  July 24, 2012 1:06 PM  |  1,434 views  |  1 comment

    Re- Finance Appraisal Red Flag # 3

    In everyone of my Appraisal reports the addenda data is at least 3 pages, no boiler plate, just the market facts. Below are some of the paragraphs in my reports;

    This format is used for all residential appraisal reports.

    Data from the subject market area MLS number, for Single Family, Attached, and Multi Family Properties.
    Present year number of Active, Pending, Expired, and the MLS sales data for the present year and the prior year;

    Example;
    00 Active,    vaule range, $00 - $00, Avg. $00, Median $00. Avg Dom 00
    00 Pending, value range, $00 - $00. Avg. $00, Median $00. Avg Dom 00
    00 Expired,  value range, $00 - $00, Avg. $00, Median $00, Avg Dom 00

    00 sales present year, $00 - $00, Avg $00, Median $00, Avg Dom 00
    00 sales prior year,  $00 - $00, Avg $00, Median $00, Avg Dom 00
    Increase or decrease,00 in sales
    Median increase or decrease in value $00 and 00%
    Percentage increase or decrease .00% and/or .00% per month
    Present and Prior, Ratio Avg is .00%. Median is .00%

    If the appraisal report is a Single Family property, a Condo unit and or a 2-4 unit Property the same "Example" would be used. Added to the Example format could be the number of bedrooms
    market data, the number of baths market data,and/or any statistic that would support the appraiser's report value and opinions.

    If your appraisal report lacks an addenda with statistics numbers, and other data to support the report appraiser's value opinion and conclusions you may not have a credible value opinion, Question; were did the numbers used in the appraisal report come from?

    Have your RE Agent and/or Appraiser fill in the ? blanks; MLS ?,Year?, The single family ratio sales price to final price range was in the ? % to ?% Range. The ? bedroom ratio was %. The average list price for sold properties was $?. The average sales price was $?. The sale price ratio to the old list price was %, $?. The average market time was ? days. 

    I recently did an appraisal report for Attorneys who needed a 1992 Market value for a single family property. If there are reliable sources I can do an appraisal. I also did an appraisal report for a property that was torn down by mistake.

    Need a well support value opinion for a residential property, Contact me 

    Jack Schlenk
    Illinios licenses; Certified RE Appraiser, RE Managing Broker
    jack327@sbcglobal.net 
    773 685 8300
  • USPAP 2012 - 2013 Standards of Professional Appraisal Practice

    Posted Under: Home Buying in Chicago, Home Selling in Chicago, Foreclosure in Chicago  |  January 18, 2012 10:51 AM  |  3,218 views  |  No comments
    USPAP - Uniform Standards of Professional Appraisal Practice
    Did your Real Estate Appraisal meet the Standards?

    The Financial Institution Reform, Recovery & Enforcement Act of 1989 requires USPAP
    compliance for appraisers in federally related transactions.

    Real Estate Appraisers are required to attend a 7 hour USPAP update course every two years.

    The 2012 -2013 USPAP Edition has: 6 Revisions, Appraisers should know what they are.
    Table of Contents:
    Definitions
    Preamble
    Ethics Rule
    Record Keeping Rule
    Competency Rule
    Scope of Work Rule
    Jurisdictional Exception Rule

    Standards and Standards Rules
    Standard 1 - Real Property Appraisal Development, 6 rules
    Standard 2 - Real Property Appraisal Reporting, 4 rules
    Standard 3 - Appraisal Review, Development and Reporting, 6 rules
    Standard 4 - Appraisal Consulting, Development, 2 rules
    Standard 5 - Appraisal Consulting. Reporting, 4 rules
    Standard 6 - Mass Appraisal, Development and Reporting, 9 rules

    Standards 7 & 8, Personal Property Appraisal Development & Reporting
    Standards 9 & 10, Business Appraisal Development & Reporting

    Plus - Guidance from the Appraisal Standards Board
      USPAP- Advisory Opinions
      USPAP- Frequently Asked Questions

    APPRAISAL REVIEW; The act or process of developing and communicating an opinion about
    the quality of another appraiser's work that was performed as part of an appraisal, an appraisal  review, and or an appraisal consulting assignment.

    COMMENT; The subject of an appraisal review assignment may be all or part of a report, work file, or a combination of these.

    STANDARD 3
    "In developing an appraisal review assignment, an appraiser acting as a reviewer must identify
    the problem to be solved, determine the scope of work necessary to solve the problem and correctly complete research and analyzes necessary to produce a credible appraisal review. In reporting the results of an appraisal review assignment, an appraiser acting as a reviewer must communicate each analysis, opinion, and conclusion in a manner that is not misleading."

    Standards 3-3
    "In developing an appraisal review, a reviewer must apply the review methods and techniques that are necessary for credible assignments results"

    1. The reviewer develops opinions and conclusion about the quality of the work.
    2. The reviewer develops an opinion of value for the subject property,
    3. The reviewer then communicates the opinions and conclusions developed in the first two steps in the report.

    There are section(s) in an appraisal report that will reveal if the appraisal report is credible and or not credible. An appraisal report that is not credible and/or misleading would require a full appraiser review. Did the subject's appraisal report explain the subject's market area and the values in that market area?.

    All of the appraisal report data should be supported and explained with the information sources
    and market data sources in the addenda pages of the report. All opinions and conclusions in the appraisal report(s) must be explained and supported by the listed reference sources in the appraisal report(s). Was this data in your appraisal report?
     
    Reports with boiler plate,and generic remarks may not support the the opinions and values in the appraisal report. If your appraisal report has generic remarks and lacks hard data to support the appraisal report opinions and conclusions the report may not be credible.

    Question; if the appraisal report is not credible (worthy of belief) can that appraisal report be used in a Federal Transactions 

    FYI. I Completed the USPAP 7 hour update course 01/01/2012 -12/31/2013 in November 2011

    Jack Schlenk, Consulant and Review Appraiser
    Illinois License(s) Real Estate Certified Appraiser & Managing Real Estate Broker
    773 685 8300
  • Forensic Appraisal Review

    Posted Under: Market Conditions in Chicago, Financing in Chicago, Foreclosure in Chicago  |  July 10, 2011 11:11 AM  |  1,383 views  |  No comments

    Per Webster's Dictionary;
    Forensic, adj. 1. Pertaining to or use in courts of law, or in public debate. 2. Adapted or
    suited to argumentation, rhetorical.

    Appraisal, n. 1 The act of estimating or judging the nature or value of something, or
    someone. 2. A valuation, as for sale or taxation. 3. An estimate or considered opinion.

    Review, n. 1.Critical article,or report. 5. Inspection or examination. 9. A viewing of the
    past events, circumstances, or facts.

    USPAP Standard 3: Appraisal Review, Development and Reporting.
    In developing an appraiser review assignment, an appraiser acting as a reviewer must
    identify the problem to be solved, determine the scope of work necessary to solve the
    problem, and correctly complete research and analysis necessary to produce a credible
    appraisal review. In reporting the results of an appraisal review assignment, an appraiser
    acting as a reviewer must communicate each analysis, opinion and conclusion in a
    manner that is not misleading.

    When reviewing the Appraisal Report, the question is, did the Report Appraiser (s) comply
    with USPAP?.The Ethics Rule, Competency Rule, Scope of Work Rule. Jurisdictional
    Exception Rule. USPAP Standard 1, Real Property Appraisal Development, and
    Standard 2, Real Property Appraisal Reporting.

    In the Fannie Mae, Freddie Mac appraisal forms there is the " Appraiser's Certification"
    Did the appraisal report data support the 25 paragraphs (Certification and Agreements)?
    Also in these appraisal forms is the "Scope of Work Requirement". Did the appraisal
    report data support these requirements? 

    If after reading an appraisal report you the reader have "why"questions and if the writer of 
    the report can not supply the proper answers and/or documentation to support their data and
    opinions in the report, this report may be a candidate for a review.

    Short Sales, preforeclosure, and foreclosured properties could benefit the most from a
    Forensic Appraisal Report.

    An appraisal report that did not comply with any of the following, USPAP, THE APPRAISER'S CERTIFICATION,and the SCOPE OF WORK requirements is is possible the report appraiser
    lacked the experience, or the knowledge, or the data resources to write an credible appraisal 
    report. 

    If the report appraiser and/or the review appraiser lack the competency for the appraisal
    assignment it is possible the data use to form a value opinion was not credible.Therefore the
    appraisal report value opinion may not be credible.
     
    Any data that is in an appraisal report must be support by a reliable source and documented
    with a paper trail in the appraisal report and/or in the appraiser's work file. 

    For a basic review to warrant a full forensic Appraisal Review contact me.

    Jack Schlenk  773 658 8300, jack327@sbcglobal.net
    Consultant, Illinios licenses, Certified RE Appraiser, & RE Manageing Broker. 







      
  • HAMP and HAFA

    Posted Under: Market Conditions in Chicago, Home Selling in Chicago, Foreclosure in Chicago  |  June 17, 2011 9:01 AM  |  1,132 views  |  2 comments
    Making Home Affordable Handbook, 180 pages, Version 3.2, 06/01/2011

    If you are listing pre-foreclosure, and short sale properties this Handbook is a must read.

    Chapter 1
    Making Home Affordable Program, Pages 18 - 45.

    Chapter 2
    Home Affordable Modification Program (HAMP) Pages 46 - 104
    Protections Against Unnecessary Foreclosure Pages 58 -60

    Chapter 3
    Home Affordable Unemployment Program (UP) Pages 106 -112

    Chapter 4
    Home Affordable Foreclosure Alternatives Program (HAFA) Pages 113 - 126
    Short Sale Process Pages 117 -119

    Chapter 5
    Second Lien Modification Program (2MP) Pages 127 - 149
    Permanent Modification Pages 139 -142

    Chapter 6
    Government Loans Pages 149 - 153

    Chapter 7
    Treasury/ FHA Second Lien Program Pages 154 - 159

    Chapter 8
    Interactions with HFA Hardest Hit Fund Programs Page 160 - 164

    Exhibits pages 166 - 178

    Read 2.3.4 Disputed Property Value
    The service must offer the borrower the opportunity to request an appraisal.

    I WANT THAT APPRAISAL JOB.

    When listing any property the RE agent must price it right to have the traffic which /should
    result in a sale. 

    Jack Schlenk
    Consultant, Illinois License(s) RE Certified Appraiser, and RE Managing Broker
    773 685 8300, jack327@sbcglobal.net
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