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Well OP was apparently willing to pay $267,500 for it initially...
True- like I mentioned previously-- when you come from a state where your taxes are over 10 grand a year and the house is 267.000 compared to 400,000, it seemed like a bargain.
Bottom line - was the bank willing to pay 250,000 (mortgage after my down payment) and the bank said "nope."
I suppose the whole point of my thread was appraisals and the big difference between sell price and appraised value and if anyone else had experienced something similar and if it was worth it to find another lender and go through it again when a difference like that is so large.
Doesn't matter now because the situation has resolved. Our agent told us that even if we got a 2nd appraisal and it came back around the same that the seller "wasn't going to give her house away". Told us all we needed to know so we cancelled the contract.
I'm buying a house of 500k in South California. Appraisal came back 485. I was willing to go to the middle and the seller also. 7500 each. This is reasonable. 37 for 250 house is not reasonable.
I'm buying a house of 500k in South California. Appraisal came back 485. I was willing to go to the middle and the seller also. 7500 each. This is reasonable. 37 for 250 house is not reasonable.
That does seem reasonable. If ours had been only a difference of say 10 grand..I would have no problem splitting that.
A house is worth what a willing buyer will pay. If a cash buyer pays the full asking price, that's what it is worth. It doesn't matter what you paid for it, what you owe on it or what you think it's worth. It doesn't matter what the assessor says or the appraiser says or what the comps come in at. The appraiser merely provides an educated guess for the lender to make a decision on how much to loan.
Only in fantasy land.
In the real world title, banks, insurance companies go by the appraisal.
Sure it could be wrong, thats what second opinions are for.
Placing the blame on the agent or seller won't fix the issue at hand.
A rich buyer could certainly pay more than its worth.
A distressed seller could take less than its worth.
In the end you're at the mercy of price per square foot + land offset by similar comps.
Unless there was $37K worth of gold buried in the garage you're SOL when borrowing money.
It's been a few years now, but when we bought our current house it was appraised less than our agreed price because the basement "scored" lower than "living" space, it was something like 75% of the value per sqft. Which is silly because I spend the vast amount of non-sleeping time in that space. The difference was a few thousand dollars, I just paid it myself. I figured the seller and I had agreed on a price, I wasn't going to ask them to drop it and I wasn't going to waste time over 3k on a house I wanted.
I do remember the lender being surprised they didn't just "make" the number work being so close to what we had agreed on.
Had OP looked at a lot of houses before offering? It seems that if this house was so overpriced that OP could have found something just as good for a lot less. How fast are prices going up in that area?
I'm in escrow now. If the house doesn't appraise, so what? I've spent months looking to find a house that works for me and I've seen what I can get for the price and I've had several good prospects snatched right out from underneath me, so someone is buying at that price level. If the appraisal comes in low, I am still going to pay the price we agreed on, because I know this house at this price is the best I am going to be able to do.
I would think that OP's house, at that price point, because the price is a large percentage over fair market value, that any sort of shopping around at all would have revealed that the house was priced considerably higher than comparable houses.
It's been a few years now, but when we bought our current house it was appraised less than our agreed price because the basement "scored" lower than "living" space, it was something like 75% of the value per sqft. Which is silly because I spend the vast amount of non-sleeping time in that space.
Split levels suffer this fate in appraisals. Had a split level under-appraise because they only count the upper floor at 100% value... even if the lower level is all above grade, it's counted as basement, and lesser value. Hard lesson, but way to get a bargain too, on a larger house. Look at split levels.
BUT, even if the OP gets a new lender and new appraisal that still doesn't mean the appraisal would come back higher; therefore, costing the OP more time and money paying for such. Plus....it would be another pull to the OP's credit! NO way are the "improvements" mentioned worth $80K and the roof and A/C are now 8 years old, so not exactly new. This seller is in denial and has a crappy realtor at that!
OP, find a new house!
Yup. Time to move onto another house. The seller doesn't care if she sells unless she gets exactly what she wants. Let it be her problem. Find another house. Don't start off life in your new home tens of thousands in the hole.....so not worth it.
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