West Virginia Code of State Rules › Agency 88 - Housing Development Fund › Title 88 - LEGISLATIVE RULE WEST VIRGINIA HOUSING DEVELOPMENT FUND › Series 88-01 - Refiling Of Administrative Rules Pertaining To Administration Of Single-Family Mortgage Loans › Section 88-1-4 - Determining eligibility of dwelling

Current through Register Vol. XLI, No. 28, July 12, 2024
4.1. General. -- Program Loans may be made
				only to finance the purchase, construction or improvement of Eligible
				Single-Family Dwellings. Each Participating Lender is responsible for assuring
				that the property which is the subject of a Program Loan is an Eligible
				Single-Family Dwelling. This determination will be based largely on an
				appraisal report made by a qualified appraiser. This report must be sufficient
				to support a conclusion by the Participating Lender that the condition of the
				property conforms with the requirements of these regulations. Normal and
				appropriate measures should be undertaken to verify the information contained
				in the appraisal, either independently or concurrently with other reviews. A
				Participating Lender may rely, however, on the information contained in the
				appraisal and plat of survey unless the Participating Lender has, or should
				have, reason to believe that such information is incorrect.
4.2. Appraisal report. -- Program Loan
				appraisals will be submitted on the appropriate form prescribed by the Housing
				Development Fund in the case of conventional Program Loans and on the FHA/VA
				equivalents in the case of FHA/VA Program Loans. FHA/VA appraisal reports will
				be prepared in accordance with applicable regulations and conventional Program
				Loan appraisals will be prepared as follows:
(a) All blanks completed. -- Each section
				must be filled out, those not applicable being indicated as such.
(b) Needed repairs. -- The report must
				indicate what repairs are needed and the appraised value must reflect the
				completion of these repairs. A compliance inspection report will be required
				when repairs are needed.
(c)
				Consideration of comparables. -- In performing the market data analysis,
				comparable properties may be adjusted no more than fifteen percent (15%) in
				value. However, higher adjustments will be acceptable if better comparables are
				not available. In the case of a new construction or rehabilitation, comparable
				house data are required.
(d) Effect
				of interest rate. -- The appraiser must consider in the valuation of the
				Eligible Single-Family Dwelling the effect of the below-market interest rate.
				Because below-market interest rates tend to increase the value of a house a
				financing adjustment factor may be required. It is suggested that only
				comparable sales be used which reflect a cash sale or adjusted to indicate a
				cash sale, then all comparables must be adjusted to reflect the below-market
				interest rate loan proposed for the subject property.
(e) Location and nature of dwelling. -- The
				appraiser must also determine and state whether the dwelling is in a location
				and of a nature and design for use which is consistent with the Program
				requirement that the dwelling will be occupied as the principal residence of
				the Eligible Borrower, that no property will be included in the purchase price
				other than land, improvements and fixtures (i.e., no items of personal
				property) and that it cannot reasonably be expected to be used in a trade or
				business, as an investment property or as a recreational house.
(f) Required assumptions. -- The appraisal
				report must report the highest price which the property will bring assuming the
				consummation of a sale, and the passing of full title from seller to buyer by
				deed, under conditions whereby:
(1) Buyer and
				seller are under no unusual pressure to buy or sell and are engaged in normal
				arms-length negotiations as to sales price;
(2) both parties are well informed or well
				advised and act prudently, each for what he considers his own best interest;
(3) reasonable exposure is given to
				the property in the open market; and
(4) payment is made in cash or on terms
				reasonably equivalent to cash, assuming typical financing terms are available
				in the community for similar property.
(g) Required attachments. -- The appraisal
				report for conventional loans must have the following attachments:
(1) Three (3) photographs, one (1) of which
				must show the roof of the structure, as follows:
A) Front and one side of the
				structure;
B) Rear and other side
				of structure; and
C) Street scene
				in front of structure showing dwelling and general view of
				neighborhood.
(2)
				Location map referring to a landmark and showing the location of subject
				property to the nearest paved road.
(3) Interior floor plan and exterior
				dimensions of all structures on the property.
(4) Plans and specifications in the case of a
				proposed construction Eligible Single-Family Dwelling. The appraiser has the
				responsibility to review the plans and specifications for completeness and
				accuracy. Any deviations from the plans must be acknowledged by the
				appraiser.