Buying a house....Appraisal came back lower!!!! Ugghh. (San Carlos Park: for sale, foreclosure)

[Chicken Wing]

My fiancee and I trying to buy a house in San Carlos Park. We're doing an FHA mortgage on a Fannie Mae foreclosed property. Everything was going well and we agreed on a price (under 100K) with the seller and everything was great until the stupid appraisal came back yesterday about 20K lower than the purchase price!

Our mortgage person said that we had a few options:

1. Try to get the seller to lower the price.
2. Pay the difference in cash (we can't do this).
3. Cancel the loan and not buy the house.
4. Find a good reason why the value should be increased and try to make a strong case to the appraiser. It sounds like that the appraiser usually doesn't budge much on this, though.

So, my question is......how often does the seller drop the price to meet the appraisal? We're talking about 20K here.

[mrcoolmrcool28]

Well, home prices are very low in the area and it's a buyers market, there are TONS of house out there, I would ask the seller to drop the 20k and tell him without the drop the sale can not go through. They may be willing to deal more than you know! Keep looking, you may fall into a GREAT deal somewhere else, the deals are everywhere

[kristin4]

It all depends if there were other offers on the house. If you are the only person that has put in an offer, you might have a chance. Also, how long the foreclosure has been sitting there? The banks do not like paying extra taxes. Have your realtor send in a copy of your appraisal. You never know.

The home we bought, had an offer that was accepted, but the same thing happened. The buyers mortgage company assessed the value lower and wouldn't budge. The selling (foreclosure) bank, wouldn't come down to the assessed value either. The buyers had to back out.

Lucky for us, but sucky for them.

Hoping it all works out for you!

[jvelte]

With the info you provided, the appraised value was at least 20% lower than the price agreed. You can certainly try pleading your case to the bank to lower the price, but 20% is a lot to budge on. How does the appraisal compare to the county assessed value?
As the Cools said, if it doesn't go through, don't sweat it. There are plenty of deals out there. It may take some time to find the "perfect" one. Don't let your realtor (if you're working with one) dictate what you should buy. You will know when you find it. Good luck!

[jvelte]

One other thing, if the appraisal was done correctly and reflects the true value of the property, then walk away if the bank doesn't budge. You certainly don't want to pay more for a house than what it is worth. In this market, you can easily get something valued at $130,000 for $85,000 or 90,000.

[cpslaughter]

Thank the bank for not financing this deal..... There are many homes in this market that are being offered well below the appraisal. Don't get stuck and remember there's a tone of 'em out there.

[hiknapster]

San Carlos property values only recently dropped like a rock. They've been dropping all along, but in the past few months they have REALLY come down. Like the others said, you can ask for less. The bank is not going to get their feelings hurt, but properties for sale in that area are a dime a dozen. Also, make sure, whatever house you are buying, that you have checked out the neighbors. It is especially important in that area. I know, I use to live there.

[nhkev]

ask for a copy of the appraisal and look at what they used for comparables. If they are in the same area and same type of property then the bank is doing you a favor by telling you although you are willing you'd be overpaying vs current market conditions. If the comps are good then send to the selling bank and say this is current market conditions lower price to appraised value, if not walk away.

[BigMunch]

do a 20 grand lower offer, final offer. If they saw no then walk and post the address here of the property.

[Chicken Wing]

Originally Posted by BigMunch

do a 20 grand lower offer, final offer. If they saw no then walk and post the address here of the property.

Why?