V.a. (buyer's agent, commision, commission, closing)

[southern by choice]

I'd like some professionals opinions on the V.A. appraisal process. I read conflicting articles. In your experience, do they come in low or is that a myth ?

[julilg]

I do not find VA loans to be as problematic as they were years ago when they got a bad rep. As with any reputation, once you get it, it's hard to shake. I suspect that's why you're getting conflicting information. Also if the loan officer is not experienced processing VA loans, it might seem more difficult than closing with a conventional loan.

I've not found VA appraisals to be off target. However, if there haven't been many recent sales of comps or there were a lot of dump and run sales or during a housing boom it might be difficult to get the appraised value that you want, regardless of the type of loan. Appraisals are based on past sales and it takes time to catch up to current market conditions. If it does comes in less than hoped, the buyer may choose to make a higher down payment to close the deal.

In my experience, an obstacle more common than low appraisals is condition of the house. Which can vary by location beacuse the basic requirement is to meet standards acceptable in that locality.

I suggest you talk to a local loan originator, if they've processed quite a few they can probably tell you about common problems to be aware of in your specific area as well as if less then offer price appraisals are common.
One more thing to keep in mind, is that due to the bad rep., or if they know the house has problems, some sellers might be hesitant to accept an offer from a buyer using a VA loan. In current market condtions that is not as likely, but in a multiple offer situation, it could be a detriment to the perceived strength of your offer.

[Ann Alison]

I sold a house to a V.A. borrower. The appraisal came in exactly where I had wanted to price it. However, the downside was they have more stringent requirements in their inspection process. I ended up saying "forget it" to the buyer but he took responsibility for the "problem."

[onevthoki]

I think all appraisals, regardless of whether they are VA or conventional, are coming in low or right on the money. High appraisals are part of what got us in to this mess in the first place!

[faabala]

They are 85-90% of our market so the VA appasial is the real value in this market. If it comes in low (and it does often) then that is the market price and the seller better get over it and sell because it stays on the books for 6 months.

We just closed a deal on a house we knew was overpriced. The VA came in $7,000 less than asking price. It originally came in $12,000 low before asking for recent comps. The selling agent was forced to give up all of thier commission (as in getting 0%) to make the deal happen because the sellers were unrealistic and stubborn. They put in a super nice remodeled kitchen and they wanted all that money back. As the buyers agents we did give up $500. The sellers were ready to keep the house (they were buying a bigger house through the selling agent) and we really wanted the house for our buyers. In the end we gave up a little commission, the sellers still paid ALL closing costs, we got our buyers the house they fell in love with, and we will get a loyal refferral giving client. The selling agent got walked over, lost thousands, all by overpricing the house. She will get the commision on their new house but not a good business plan.

[julilg]

Originally Posted by faabala

They are 85-90% of our market so the VA appasial is the real value in this market. If it comes in low (and it does often) then that is the market price and the seller better get over it and sell because it stays on the books for 6 months.

We just closed a deal on a house we knew was overpriced. The VA came in $7,000 less than asking price. It originally came in $12,000 low before asking for recent comps. The selling agent was forced to give up all of thier commission (as in getting 0%) to make the deal happen because the sellers were unrealistic and stubborn. They put in a super nice remodeled kitchen and they wanted all that money back. As the buyers agents we did give up $500. The sellers were ready to keep the house (they were buying a bigger house through the selling agent) and we really wanted the house for our buyers. In the end we gave up a little commission, the sellers still paid ALL closing costs, we got our buyers the house they fell in love with, and we will get a loyal refferral giving client. The selling agent got walked over, lost thousands, all by overpricing the house. She will get the commision on their new house but not a good business plan.

The selling company is the buyer's agent. The company that markets the property is called the listing agent.

[faabala]

Originally Posted by julilg

The selling company is the buyer's agent. The company that markets the property is called the listing agent.

OK.... I meant to type seller's agent. Thanks for correcting me.