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Updated over 9 years ago,
Will An Appraiser Deduct If a Property Had A Fully-Certified Meth Abatement?
I have a property to wholesale that has its certificate of meth abatement after someone smoked there. It cannot be found on any list as being a meth house and is totally expunged from the list. The sheetrock has not been replaced in the basement, but has been on the main floor. The craftsmanship needs a little more sanding, as it was done by a tenant, desperate to get back in the house after the abatement in a market that's on fire - Denver.
A buyer I have worked with before has a lender that does both an As-Is and ARV appraisal. I seek to learn if they would do a downward adjustment if learning of a Meth abatement. It is supposed to be a non-issue in Colorado under Colorado Senate Bill 06-002, since year 2007.
Even so, I don't know what an appraiser will do, and one will certainly wonder why the bath tile are missing in the lower bathroom and the lower sheetrock. I have been told that an appraiser is to appraise the condition of the property, and not a situation, unless its near a busy street, etc. The tenant of course would like the property not to change hands and will likely volunteer that it was a meth remediation but I don't know if an appraiser will be obligated to say anything or adjust for it. Its supposed to be a non-issue, but humans are humans. Would he have to disclose to the lender that it was?
There is no documentation or list of addresses with meth contamination that it appears on, as it was removed after the remediation, which is supposed to give the house a fresh start, at a cost I believe of $18K. Can I risk this buyer with a bank appraiser that this fellow works with for his buy and holds - its not a hard money lender but one this investor holds dozens, perhaps over a hundred properties with in bundled commercial loans.
Would prefer to have someone with just a checkbook walking through, but so it is. I am afraid this thread is going to go off into appraisal theory. As said, I seek to have the condition appraised, and not a situation, as there is no situation anymore, according to the state senate, but don't know what a bank appraiser will do anyway. I hope this thread doesn't start a firefight.