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People get scared they won't find a home when inventory is thin. Some Realtors may be more concerned about their earnings, just as some loan officers are concerned about making their numbers. Add any two together and you have the makings for one of the highest era's of low appraisals.
heh. I get scarce inventory creating a sense of urgency in a buyer, but to offer $100-150K+ over the nearest set of comps screams a little too 2006 to me. I don't think the housing environment has quite returned to that level of frothiness but you're on the loan side of things so you might have seen otherwise.
Your financing has not been approved, so that is your out. You cannot remove a contingency (unless you did something really dumb (sorry)) which has not been met. That is why they are in your contract--to protect you from this very outcome.
heh. I get scarce inventory creating a sense of urgency in a buyer, but to offer $100-150K+ over the nearest set of comps screams a little too 2006 to me. I don't think the housing environment has quite returned to that level of frothiness but you're on the loan side of things so you might have seen otherwise.
You missed the other part of my equation - the Realtor that doesn't care or notice that his buyer is paying more than market, because they are too worried about their own pocket. Not exactly the way we want to think of Realtors, but when the top 20% do 80% of the business, it's easy to see the majority are not making a great living. And I am not supporting poor advice or questionable ethics, but I do understand desperation and what it does to people when they really need a sale. And many will turn a blind eye, just so they can sleep at night.
We did run a CMA before offering, the agent said about $700 but later said $720 K tops because of the some other upgrades, we originally offered 715, but bided over that when we heard 2 other people were also bidding (but we didn't know how much for) thinking it would be caught at appraisal anyway if the house is way over valued, and also willing to go up to 15 k over appraisal if it came to that
We had the new appraisal done today, he's writing it all up tonight and will submit tomorrow, so I will let you all know what happens
I'd also add that I'm not comfortable waiving a financing contingency ever, at least not until the loan funds have actually landed in the closing agent's account which is usually day of closing.
So if the loan has been approved but hasn't funded on the contingency removal deadline, you won't release the contingency? Here the seller is likely to cancel If you don't release on time. The buyer is counting on the mortgage broker to get the loan approved before the deadline.
The second appraisal came back as 735K (the same as the other, and our agreed price)…it has all been approved now by the underwriter but I was concerned when I did read it, because this time this new appraiser used only within 1/2 a mile (one still active)..the rest up 2 1/5 to nearly 5 miles away..one was even still active selling for over a million dollars 4 miles away!! A range house with stables etc nothing like our home. Also 3 out of 7 comps he used were one story ranch homes, but for some reason says they are 2 story? Another one he said had no solar (the house we are buying has solar for the pool) so added $5K adjustment, when actually that house DOES have 40K net worth of solar (paid off) for the whole house and pool, and is linked to the grid for no electric bills..I know this because we were the back up offers on that house, he took off 25k (adjustment) from our house we are buying because of that other house was gated within a golf course..(4 miles away though, with an elementary school of 8/10 than ours 4/10??), on that house alone his other adjustments it to came to $735K but if I take off the $25k to make it right (about the solar) then it should had been 710K.. (I know to do 20K cos he put that as the price adjustment with the million dollar home having house solar), and he added 5k for none.
Anyway, there's my rant..of course I have to trust the second appraiser and the underwriter catching anything odd, my husband is over the moon..he just wants to move in. But of course we just hope this wasn't done just make it all happen. The second appraiser, was so much better, he commented why he used these homes etc..where the other guy had no comments, and when asked went into a ball and rolled off.
Should be moving in within the next week, Thanks everyone for your comments and advice
just rereading my last post that I can't re-edit now I meant to say.. " because this time this new appraiser used only 'TWO' within 1/2 a mile (one still active)..the rest up 2 1/5 to nearly 5 miles away..
just rereading my last post that I can't re-edit now I meant to say.. " because this time this new appraiser used only 'TWO' within 1/2 a mile (one still active)..the rest up 2 1/5 to nearly 5 miles away..
How can an active comp be used in an appraisal? Doesn't a valid appraisal require actual closing prices?
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