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OK I got a great deal on a refinance (4.49% for a 30 year with no points) and really low closing costs. The only show stopper could be the appraisal.
NY State requires that the appraisal come in within 105% of the total amount of the loan (nearly every other state in 125%!!!). So, I need my home to come in at 255K or higher. It was appraised at 300K in Jan 2008 when we bought it.
It's a 4br 2 bath Cape in Sound Beach built in 1992. Structurally it needs no work (basically nothing has changed in the house in the 3 years we've owned it). The only thing I added was a pellet stove, and put in a closet in one of the bedrooms.
I'm wondering...is there anything I can do to get the most out of the appraisal? I fear i'm probably looking at 250K based on comparable sales...so it'll be close.
Anyone around here go through this recently and have ideas on what I might do in the next week and a half?
I know when I sold my house last year my realtor pulled comps to give to the appraiser (who my DH said was a bit of a jerk)...I have no idea what it appraised for but my buyers didn't have any issues. They did put down 30% though.
If you did work on the house having proof of it probably helps.
There is not much that you can do to influence the outcome of an appraisal. Just make sure that your house is neat and clean and if there are any obvious repairs that need to be done, do them.
One of the things making appraisals more difficult today is that the lenders are not allowed to hire them directly. They are hired through 3rd party companies, so often they are not familiar with the nuances of a neighborhood. So, if it comes back below what you need, get a copy of it and examine closely the comps that were used. If there is something wrong (such as using a different school district) go back and point it out to your lender.
I think those times are long gone, when you could "bribe" an appraiser or have the lender pick and choose appraisals who provided "favorable" numbers. Now with the housing market the way it is, I seriously doubt any lender or appraiser engages in these shenanigans.
Or so I would figure until I saw this....(read below)..
With that said, I am in a somewhat similar boat as OP. I've been wanting to refinance my condo in Queens for the past 2 years. I bought it in 2006 and put down only 5% at closing (big mistake but too late now). The condos in my area are selling for anywhere between $160-180K but last year I paid $ 500 for an appraisal with the goal of refinancing and was told my condo was only worth $ 145K.
So basically, my bank said I need to come up with almost 40-50K at closing to refi because of the underwater mortgage. Technically I can do this but I dont want to completely deplete my savings. As it stands, I am pissing away $ 800/month because the unit is being rented and the rent doesnt cover 100% of the mortgage/HOA dues. Nevermind the fact that short selling or foreclosure is NOT an option for me because DH and I plan to buy a bigger house in a few years, and our jobs/finances are very stable (I can't claim any financial hardship for shortsale approval).
Meanwhile, my research on MLSLI.com and Zillow shows the EXACT SAME UNIT (1 bedroom condo with same floorplan/layout) above me in the SAME building sold for $ 185K in early June 2011. So if my unit appraised for 145K only a year ago, how on earth did the same apartment on the floor above mine sell for almost 40K MORE???
I am in utter disbelief and my only conclusion is that something REALLY fishy is going on with the appraisal business. So I, too, would be interested in hearing any other advice being offered to the OP because having witnessed another 1 bedroom condo in my building being sold for 40K more than what it should have really been appraised for - is very hard to swallow right now (and no before anyone responds with "maybe it was worth the 185K due to condition", I saw the pictures, my unit is actually in better condition with new appliances over the one above mine!).
Last edited by LegalDiva; 08-11-2011 at 02:30 PM..
OK I got a great deal on a refinance (4.49% for a 30 year with no points) and really low closing costs. The only show stopper could be the appraisal.
NY State requires that the appraisal come in within 105% of the total amount of the loan (nearly every other state in 125%!!!). So, I need my home to come in at 255K or higher. It was appraised at 300K in Jan 2008 when we bought it.
It's a 4br 2 bath Cape in Sound Beach built in 1992. Structurally it needs no work (basically nothing has changed in the house in the 3 years we've owned it). The only thing I added was a pellet stove, and put in a closet in one of the bedrooms.
I'm wondering...is there anything I can do to get the most out of the appraisal? I fear i'm probably looking at 250K based on comparable sales...so it'll be close.
Anyone around here go through this recently and have ideas on what I might do in the next week and a half?
What you're alluding to is a crime.
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