Analyzing the Sales Contract

 Within all lending appraisals performed for purchases the appraiser is required to "analyze" the sales contract.  This means that the appraiser needs a signed, by both seller and buyer, and dated copy of the contract. 

If this copy is not supplied the appraiser must check the DID NOT box and explain why it was not analyzed.  The report ends up being finished and sent into the client. 

The biggest issue with this is that down the road, the client suddenly comes running with a copy and needs the report to reflect that the contract was analyzed. This creates a problem.  The report originally states that as of THE EFFECTIVE DATE OF THE APPRAISAL the contract was not analyzed on page one.  It cannot be changed as changing it would be considered to be a violation of USPAP.  USPAP states that an appraisal must not be misleading. 

This truly becomes an issue when a copy of the contract is signed and dated after the effective date of the appraisal and the client still needs it to be analyzed as part of the original report.  Basically asking the appraiser to state that a contract was in existence before it was executed. 

In order to avoid this type of situation all selling brokers and mortgage brokers should do their best to get the appraiser a copy of the contract either at the time of ordering the appraisal or at the time of property observation.  This will save all parties involved time and remove a stumbling block from the process.