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Old 09-11-2008, 12:18 PM
 
51 posts, read 122,805 times
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Just wondering if the house we have purchased, which is a new construction home in a housing track, (located in So. CA) will end up appraising for less than the amount we signed the contract for. Has anyone else experienced this recently? Since the market continues to drop, I wonder if the house will be worth less and if so what is the likely scenario??? Would the builder be likely to drop the price of the home to its appraised value??? The house is supposed to be complete at the end of September and escrow is due to close sometime in early Oct. Any advice????

Last edited by mantismom; 09-11-2008 at 01:13 PM..
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Old 09-11-2008, 03:35 PM
 
Location: Plano, Texas
1,676 posts, read 6,334,056 times
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If you have not closed on the loan then make sure you get a new appraisal. If the value has dropped, ask the builder to lower the price. Hopefully, there is a mortgage professional on this board from your area that might be able to give better advice.
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Old 09-12-2008, 10:38 AM
 
25,342 posts, read 37,480,980 times
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if the builder won't lower the price and you need a mortgage, you might get out of the deal since the mortgage company won't pay more than it apprases for...and I wouldn't close on a house that isn't worth what i have to pay for it.....specially with so many homes on the market...you are in a great position here and I doubt the builder won't lower the price. I have experienced builders doing it and friends of mine got $ 10K off the house just before closing or they told the builder they would walk away and leave their deposit, which wasn't that much...they closed and are happy, but still the prices dropped, but at least they paid $ 10 K less!
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Old 09-12-2008, 02:08 PM
 
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I would not surprise me at all that it appraises less now than it did when construction began. This is a huge problem in CA. I would certainly spend the extra $250-$350 for a new appraisal. The lender is not going to loan money for a value less than the appraised value.
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Old 09-14-2008, 08:02 PM
 
51 posts, read 122,805 times
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Question Update......

We got a call today from the sales rep. She informed us that the builder has recently gone into chapter 11 Bankruptcy. She assured us that this would not affect us. I'm wondering if it really will affect us or not. The house is practically finished.

Does the house get appraised at the finish of construction??? or is that something we will have to request and pay for out of pocket??
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Old 09-14-2008, 08:15 PM
 
Location: Fort Myers, FL
1,286 posts, read 2,594,965 times
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yes you will still get an appraisal. if your in a declining market, i would demand for a 10% off the appraisal price. also possibly consider consulting an attorney. find out how the bankruptcy could effect you and your development.

how completed is the neighborhood?
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Old 09-14-2008, 08:49 PM
 
51 posts, read 122,805 times
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Our house is part of phase 12, they are building 4 homes which includes ours. They have recently (about 2 weeks ago) poured the foundations and plumbing for 4 more homes. Our house including the three others are at the end of construction. The sales rep told us that we are due to move in sometime early Oct. I hope all goes smoothly......and I am hoping the house appraises for less. Thanks for all the advice. If for some odd reason it does appraise for less and the builder doesn't budge we will take our business elsewhere.
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Old 09-15-2008, 07:23 AM
 
Location: Fort Myers, FL
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you make want to get your own independent appraisal and don't forget to hire an inspection.
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Old 06-10-2009, 01:21 AM
 
25 posts, read 52,404 times
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all of this attitude amazes me... you go to a builder, ask for a product, he gives a price and produces the product. Then even if he went above and beyond with the quality of his work, because the freak'n market changes by the end of the project people expect to put the screws into him like as if he screwed up... what a world.
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Old 06-10-2009, 07:24 AM
 
4,543 posts, read 11,547,065 times
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Quote:
Originally Posted by mantismom View Post
We got a call today from the sales rep. She informed us that the builder has recently gone into chapter 11 Bankruptcy. She assured us that this would not affect us. I'm wondering if it really will affect us or not. The house is practically finished.

Does the house get appraised at the finish of construction??? or is that something we will have to request and pay for out of pocket??
Be SURE to get an owner's title policy!
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