I searched for the last year using "appraisal" as my criteria and did not find my question, so here it is.

We quoted the usual appraisal fee on the GFE. Subsequent to providing the GFE, the appraiser notified us and stated that due to the location of the property and the property being a manufactured home, comps will be rare and would take extra time to research. As a result, the appraisal will cost $150 more than what we quoted on the GFE. Is the fact that we were not aware of the appraisal complications when we issued the GFE a changed circumstance?

I vote no, not a changed circumstance. If the majority of your business is on manufactured homes in this location you should have been aware of the price of an appraiser on your provider list (I am assuming they are on your list or why would you care). If this situation is not the norm, I would have called my friendly appraiser to get a quote. I am sure this position will be challenged but this is how it would have been handled at our bank.

an appraiser on your provider list (I am assuming they are on your list or why would you care).

Appraisers do not appear on the providers list and they are chosen by the lender therefore they are always subject to the tolerance.

I would suspect due to the information obtained on the property after the fact that you could qualify this as a changed circumstance.


xiii) After the GFE is issued, it is determined that an additional service such as an additional pest, structural or other inspection, upgraded appraisal, certification, survey or other requirement is required by the loan originator in connection with the transaction.
A: This could constitute a changed circumstance. A loan originator may issue a revised GFE reflecting only the increased charges resulting from the ―changed circumstance‖.

I stand corrected, Dan but our bank compliance officer has instructed us to err on the side of caution and we are required to verify charges on anything that might fall out of the relm of "usual" like excessive acreage or distance out of town.

That is a good best practice but it may not catch every situation.

We have had situations where the applicant told us the house was a 1-4 and once the appraiser got there it was a manufactured home. We have even had them tell us they lived in one county and due to the boundary lines they were actually in another county. They were basing their county on the location of the post office they got their mail from.

I'm a stickler for changed circumstance but there are situations where the appraiser, or another provided even, will find something strange that you would have no way of knowing at the time you completed the GFE. In those limited situations I think you could qualify them as changed circumstances. Like anything else in compliance, documentation for the changed circumstance is crucial.

Limited situations as well as comprehensive documentation, good advice!

Thanks everyone!

The bank didn't know that the appraiser couldn't get to the property in time because its too secluded and they need to rush the appraisal and pay an additional fee in order to get the appraisal sooner and close by the contract date. Change of circumstance?