Property Condition Reports (PCRs) help lenders comply with the Interagency Appraisal and Evaluation Guidelines regarding the inspection of a property.
The guidelines state:
“A valuation method should address the property’s actual physical condition and characteristics as well as the economic and market conditions that affect the estimate of the collateral’s market value. It would not be acceptable for an institution to base an evaluation on unsupported assumptions, such as a property is in “average” condition, the zoning will change, or the property is not affected by adverse market conditions. Therefore, an institution should establish criteria for determining the level and extent of research or inspection necessary to ascertain the property’s actual physical condition, and the economic and market factors that should be considered in developing an evaluation. An institution should consider performing an inspection to ascertain the actual physical condition of the property and market factors that affect its market value. When an inspection is not performed, an institution should be able to demonstrate how these property and market factors were determined.” — Section XII Evaluation Development (page 13)
When a property condition report is ordered through Simplified, lenders can rest assured they will receive a professionally done report that will contain the following information:
- Report on the appearance of the property
- Address verification
- Property damage information (if available)
- Neighborhood attributes (both positive and negative)
- Local market conditions
- For sale sign on property
- Evidence of occupancy
- Photos of the home
- Photo of address verification
- Inspector's name
- Date of inspection
Using the Simplified platform, lenders can now cost effectively supplement their existing AVMs and Tax Assessed Values with a property physical and neighborhood condition report to not only comply with the Interagency Guidelines, but also to ensure they are making informed decisions on their real estate loans.