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We're in contract for a home and the appraisal came back for waaaay less than the price we agreed to pay for the house. The seller, a relocation company, is aware of the situation. From what I know, our agent sent the appraiser a list of comps in the area and although our sales price is slightly higher per square footage than the average, it's nowhere near the $117K difference. I imagine by Tuesday, we should know a.) if the appraiser is going to change the originally assessed value and b.) if the seller agrees to sell the home for that amount. Our closing date is 29 May.
I've talked to our mortgage company and he's confident that we will close by 29 May. My questions are:
1. Is it realistic that we can still close by that date or is this wishful thinking?
2. Can the seller request for another appraisal and consequently extend the closing date or does the seller have to meet the closing date on the contract?
3. True or false: banks will not let you borrow more money than the appraised value of the home. If true, then are there alternatives for us, as the homebuyer, to still get the home, assuming the seller disagrees with the appraised value? If false, will the negotiation be between the seller and our bank? Or, whatever the appraised value ends up being is the only amount the bank will loan us?
4. Any additional possible outcomes? We think 1 of 2 things will happen:
a. The appraiser comes back with a higher number somewhere between the difference and the contract price and the seller agrees to the offer and we get a smokin' deal on the house.
b. The appraiser comes back with a higher number somewhere between the difference and the contract price and the seller rejects the offer and we lose the house.
The home is in a pretty nice neighborhood and is a sem-custom home. My agent thinks that the appraiser didn't do his due diligence. On the flipside, the seller's agent told the seller that their asking price was too much (the conract price is $12K less than the asking price) and she thought the home's value was somewhere in the middle of the assesed and contract price, from what I've been told. I knew we were probably overpaying for the house but I didn't imagine it to be that large of a spread.
Both my agent and my mortgage company seems to think everything will work out. Are they just pulling my leg or should I be hopeful? I am a cynic so I'm almost resigned to just let this house go.
Like the others said the bank will not loan more than the home is worth, homes are depreciating fast is some area's depending where your from the appraisal could be dead on. Relocation companies don't want to hold on to properties especially in this market. So if they are asking for another appraisal I would make sure they pay for it. But that doesn't mean your lender will go along with the new appraisal either.
Don't become emotionally attached to this home, there are allot of homes for sale and if this one doesn't go thru there is more to pick from.
First, what does your contract say about appraised value? Does it say the contract terminates, the buyer would have to make up the difference (in cash) or the seller may elect to change the purchase price to the appraised value?
Second, what would you like to happen? If you want to buy the house at the new appraised value, would the bank like a copy of the appraisal and an addendum to change the price to the new value?
If you have the appraisal report as a PDF on your computer
Thanks for the offer but I didn't get the report. I'm rethinking this decision though!
Quote:
Originally Posted by 007 license to sell
Don't become emotionally attached to this home
Too late! In a way though, we're both telling ourselves we're actually "lucky" to have gotten an appraiser who's "done the right thing". I mean, if the sellers accept the appraised value, we'll be getting a sweet deal! And if they don't, my gut was telling me we were overpaying this whole time. I just couldn't get myself to say no. Someone else has done it for us!
Quote:
Originally Posted by 2bindenver
First, what does your contract say about appraised value? Second, what would you like to happen?
There's an appraisal contigency and we can get out of the contract if it doesn't appraise for at least the sales price; we also get the earnest money back. What I would LIKE to happen is whatever the appraised value is, the sellers accept and we get the home! We know the home is worth more than the original appraised value so on our end, we're going to accept whatever the "re-appraised value" will be. Yes, we will have an addendum.
HOLYCRAP!!!!!!! So the appraisal was reevaluated and they kept it at $117K difference!!!! GOOD GOD! Now we're just waiting to see if the sellers want to sell. OMG, I'm like seriously, speechless!!!!
HOLYCRAP!!!!!!! So the appraisal was reevaluated and they kept it at $117K difference!!!! GOOD GOD! Now we're just waiting to see if the sellers want to sell. OMG, I'm like seriously, speechless!!!!
If it's relo company-owned, I suspect they will ammend the sale price.
If it's relo company-owned, I suspect they will ammend the sale price.
How long has this pup been sitting on the market?
What do you mean by amend? I mean, I know what amend means but do you mean that they'll go down to the appraised value or they give us a number and we, the buyers, either come up with the difference or not buy?
It was sitting in the market for at least 100 days if i recall correctly.
I'm upset and grateful all at the same time ... weird weird feeling!
HOLYCRAP!!!!!!! So the appraisal was reevaluated and they kept it at $117K difference!!!! GOOD GOD! Now we're just waiting to see if the sellers want to sell. OMG, I'm like seriously, speechless!!!!
Foma, I will stick with what I said before. You should offer what the house appraised at and no more. If they do not accept, then walk away. Oh, and definitely fire your real estate agent
Too late! In a way though, we're both telling ourselves we're actually "lucky" to have gotten an appraiser who's "done the right thing". I mean, if the sellers accept the appraised value, we'll be getting a sweet deal! And if they don't, my gut was telling me we were overpaying this whole time. I just couldn't get myself to say no. Someone else has done it for us!
This sort of thing has happened to me twice so far (though not for as much as $117K! more like $30-40K). And this is just about the way I've been thinking about it-- kept me from paying too much for a house. Am still shopping, but I can afford to be patient-- prices are still dropping, so the longer it takes the cheaper it looks like it will be!
Update: We got the home!! ...for significantly less might I add. WoOt wOot!! The reappraisal went up slightly but we still saved over $80K+. The original appraisal was "wrong" because the sales price he/she used was incorrect. The sellers accepted the amount and we're happy with it, too. Can't wait to move in!
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