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Did you have to pay the second appraisal?Do sellers ever order their own appraisal?
No I didn't since it was the request if the bank. Sellers can order an appraisal but it's not part of the process generally. Usually if they get one, it's for their own purposes such as refinancing or just wanting to know the value of their own home.
Are you sure this extra lot is included? So, you'll have two deeds? Two property tax bills?
She did not buy the property with the extra lot. She thinks that the vacant property was used as a comp by the owners to determine value. Given vacant lots are typically less than a lot and house, it would skew the comp values down.
We are in the process of buying a home and in the process of applying for a mortgage. We just found out today---the appraisal came in 100K OVER the sales price! We bid the house up slightly, because we didn't want to lose it, and the sellers accepted our terms, all in writing, etc. I don't know how this happened but good for us!
My concern is, could the sellers rescind the offer and ask for more? I do believe this is a bit of a "distress" sale. From what I can figure out, the owners are now in a nursing home, and the adult children are selling the home to spend down the parents assets to qualify for Medicaid---qv, subject of many other threads on here.
Lots of questions--
Can sellers pull offer and make another offer for a higher price?
How does appraisal value relate to market value?
Would we be able to waive PMI if there's 20% + equity in the home, even though that's not all from our down payment? In other words, is it necessary to have 20% of OUR money in equity, or just 20%+ equity in the home?
Would our taxes be based on the appraised value, or our purchase price?
Thanks for answers
An accurate appraisal SHOULD be market value, but that doesn't mean it will sell for that amount.
If you can get out of paying PMI initially (not 100% sure if you can), it would depend on the type of loan. FHA for example you can't. You might be able to refinance pretty soon though? Ask your lender.
How the taxes are determined varies by state. I'm not aware of anywhere where that type of appraisal would be used to determine assessed value/property taxes. In most cases the basis are sales prices, but I know in my area for example the assessed value for tax purposes essentially only changes every few years so it doesn't automatically change based on a new sales price. You should know what the current taxes/assessed value are, and your agent should know if that will change after your purchase.
OP, I had something like this happen to me. Here is my advice-- make it CLEAR to your agent in no uncertain terms that they are NOT to share the information about the appraisal. They should know this, but put it in writing.
In my case, my agent got to chit chatting with the seller's agent as they were in the same office and let it "slip." Once the proverbial cat was out of the bag the seller tried everything in their power to pull out of the contract. They were ultimately unsuccessful but it made life very difficult and at one point, the seller was threatening to sue us and all kinds of crazy things.
So though your agent should know to keep quiet, protect yourself by telling them in writing that you expect this information will be kept confidential as is appropriate.
An appraisal is intended to be an estimate of the market value.
Quote:
Originally Posted by MaryleeII
Would our taxes be based on the appraised value, or our purchase price?
Tax assessment practices vary by state and even by local municipality (largely based upon the competence of the local Assessor). As an example, in Michigan, tax assessments are based upon the estimated market value at the time of purchase, although the purchase price may be a consideration in the estimate of that value.
Quote:
Originally Posted by aridon
Appraised value and market value are not the same thing.
The purpose of an appraisal is to estimate the market value. True, appraisals--as will all opinions--may vary, but they are still supposed to reflect actual market value.
Quote:
Originally Posted by MaryleeII
Just looking at the comps for the area, included is a piece of undeveloped land.
A piece of undeveloped land is not a comp for a lot with a house on it.
OP, I had something like this happen to me. Here is my advice-- make it CLEAR to your agent in no uncertain terms that they are NOT to share the information about the appraisal. They should know this, but put it in writing.
In my case, my agent got to chit chatting with the seller's agent as they were in the same office and let it "slip." Once the proverbial cat was out of the bag the seller tried everything in their power to pull out of the contract. They were ultimately unsuccessful but it made life very difficult and at one point, the seller was threatening to sue us and all kinds of crazy things.
So though your agent should know to keep quiet, protect yourself by telling them in writing that you expect this information will be kept confidential as is appropriate.
Why would your agent even know what the value came in at?
We are in the process of buying a home and in the process of applying for a mortgage. We just found out today---the appraisal came in 100K OVER the sales price! We bid the house up slightly, because we didn't want to lose it, and the sellers accepted our terms, all in writing, etc. I don't know how this happened but good for us!
My concern is, could the sellers rescind the offer and ask for more? I do believe this is a bit of a "distress" sale. From what I can figure out, the owners are now in a nursing home, and the adult children are selling the home to spend down the parents assets to qualify for Medicaid---qv, subject of many other threads on here.
Lots of questions--
Can sellers pull offer and make another offer for a higher price?
How does appraisal value relate to market value?
Would we be able to waive PMI if there's 20% + equity in the home, even though that's not all from our down payment? In other words, is it necessary to have 20% of OUR money in equity, or just 20%+ equity in the home?
Would our taxes be based on the appraised value, or our purchase price?
Thanks for answers
It is highly unlikely that the sellers know what it appraised for only that it appraised. We couldn't find out that information from our agent when we asked after it appraised. And no, the sellers signed the contract, they can't pull out now without risk of lawsuit and paying their agent as well as yours. Tax appraisals are another matter and not based on bank appraisals but their own appraisal. It may or may not be higher than the purchase price.
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but good for us!
