January 4, 2011 1:21 PM
(From Michael Imes)
From an appraiser we all know...
I was asked to inspect and provide a Certificate of Final Completion (Form 442) on a high rise complex in Bellevue. On the surface, no problem.
* The bank ordered the 442 via their wholly owned AMC. (warning)
* The AMC, based on instructions from the bank, was willing to pay a whopping $100. (warning)
* Prior to this, I've have had no connection with the buildings at all; No appraisals, no construction inspections - zip nada. (warning)
* So me providing a certificate that says the buildings are complete according to the original appraisal is a bit odd, but possible with a lot of additional information. (warning)
* Oh and there are two 42 story towers involved with this 442 and they
thought $100 was sufficient for "my time." (warning)
After numerous conversations with numerous people at the AMC and bank, we
settled on a much higher fee and a total inspection of all units. Still they grumbled.
The units in the buildings were a mixture of: metal studs only, some sheet rocked and some 100% finished. Numerous balconies did not have railings (remember 42 floors). I stated such on my inspection report.
Then it started:
* Phone calls and emails, from the AMC and the loan officer, demanding that I certify the building complete.
* We won't pay you until you complete the 442.
* "You didn't do your job correctly"
* "You will give us what we hired you for or will never hire you again" blah blah blah!
In one of my conversations, trying to explain reality to them, I said:
"Let me explain it this way - If I sign off and the building goes into foreclosure, I'd be taking full responsibility for my "Certificate of Completion." If this goes sideways I'm responsible for my statements and the difference between the completed value and the unfinished as-is value. I'm not going to lie about this."
And they told me: "That's not going to happen, this developer has more money than God and will never go into foreclosure, so don't worry, just sign off on the 442."
No! And that was the last 442 I've ever completed for this AMC and their lender.
Now, as Paul Harvey says, for the rest of the story:
I wonder which appraiser signed off on these buildings being "complete?"
His life is about to go sideways and become an economic wipeout.
In my opinion, they were looking for a sucker to take the fall and the responsibility for a multi-million dollar loss. Don't be that sucker, stand up for what's right. Sometimes saying "NO" is the easiest and best money you never made!
Do your job right and don't let a bad AMC or bank tell you how to do it. You likely know more about the business than they do.
Richard Hagar SRA
Maybe no one signed off on it. It wouldn't be the first time a lender falsified records or ignored regulations. There's money to be made, remember? -Michael Tabor