UAD 3.6
The most common concern expressed by our appraiser clients are where/how to include the additional language they have traditionally added in the supplemental addendum of the appraisal report. It is important that appraisers continue to add this language in their reports; we suggest that they add the language in the "Commentary" sections of the report whenever relevant and possible. Please note that we are still learning how to best incorporate our loss prevention suggestions into the new forms.
Examples:
Section 2 - Assignment
As a final comment under Assignment Information and Scope of Work Commentary, add the following language:
"The appraiser has been retained to arrive at an opinion of value for the subject property and is not a Home Inspector. The ‘inspection’ performed by the appraiser is more of an observation and is not intended to reveal defects in the mechanical systems, plumbing, electrical systems, structural integrity, roofing, or other components of the home and the appraiser does not claim to be an expert in those areas. There could be defects hidden behind floors or wall coverings or inside cabinets or closets or behind furniture or under rugs. It is not the responsibility of the appraiser to perform the kind of inspection designed to find those kinds of problems nor would he have the expertise to detect or diagnose many of those issues even if something was discovered.
The appraiser does not guarantee that the home is free of environmental problems. The appraiser can only observe areas that are visually accessible. Mold could be present in areas of the home the appraiser could not see.
The appraiser is not inspecting the property to determine the current presence of wood destroying or other insects nor is he looking for evidence of any past infestation.
The appraiser is not an expert in the identification of adverse environmental factors such as radon gas, lead based paint, mold, fungi, asbestos, formaldehyde, ground water contamination, underground storage tanks, etc. If the client has any concerns about or questions about such conditions an expert in this field should be called to do an inspection."
Section 4 - Site
When disclosing any observed defect or damage, etc. to the property it would be advisable to repeat all or some of the language suggested above in the Site Commentary where the issue/condition is disclosed.
"The appraiser observed a substance on the walls in the main bathroom that appears to be mold, refer to the enclosed photographs. The appraiser is not qualified to determine the cause of the mold, the type of mold or whether the mold might pose any risk to the property or its inhabitants. Additional inspection by a qualified professional is recommended."
Section 29 - Intended Use
Consider adding the following language under Additional Intended Use:
"The intended use of this appraisal report is for (insert assignment reason form section 1 here). No other intended use is authorized and reliance on the report by any individual or entity for any other intended use is done at their own risk."
Section 29 - Intended User
Consider adding the following language under Additional Intended Users:
"The only intended user of this appraisal is the lender/client, (insert lender/client name here). There is no other intended user. No purchaser, seller, or borrower are intended users of this report. No party, other than the intended user, should rely upon this appraisal for any purpose, whatsoever. The fact that some party, other than the client, paid for the appraisal, either directly, or indirectly, does not make them an intended user."
Always feel free to edit any suggested language to meet your specific needs.