Return to the Buying and Selling Homes Forum | Post a Follow-Up

 o
Received a low appraisal from bank, now what?

Posted by rockstarwife (My Page) on
Tue, Mar 30, 10 at 22:14

We put in an offer to buy an investment house (short sale). It was accepted by seller and we did a contract and put $1000 good faith money. Then it was appraised for $20,000 less than the asking/contract price! Our agent is unable to find any comps in the area (truly). I tried as well and NONE! So NOW what? We absolutely positively want that house and need to get it ASAP as we have renters ready to move into it! The bank is telling us we need to put more down on it and we feel like we are being jacked around. Why is the price so high if the appraisal is so low? WHO do we ask? What's our recourse? We are tempted to just pay cash (which we can do). We are so aggravated over this whole deal. WHAT do we do? Thank you for your help!


Follow-Up Postings:

 o
RE: Received a low appraisal from bank, now what?

You can go back to the seller with the appraisal in hand and renegotiate a 20k drop in price, or ask them to meet you half way by 10k. Since it's a short sale this may take a while. Or you can come up with the additional down payment. I had one of my previous homes that appraised for under the contract price, lucky it was only by 1K, we came up with the extra funds because it was worth it to us. Had it been by 20K I think we would have walked if the seller couldn't bring down his price.


 o
RE: Received a low appraisal from bank, now what?

Getting an offer accepted by the seller is often the easy part of a short sale. Getting bank approval can be a whole other story. Short sales take time, often lots of it.


 o
RE: Received a low appraisal from bank, now what?

Your bank is protecting your and their interest with that appraisal. Why would you want to up your offer to pay more for a house where the value isnt there? Make another offer to the bank for appraised value. It is what it is.


 o
RE: Received a low appraisal from bank, now what?

$20K is a lot of money. Even if I was able to pay cash, I would try to renegotiate the price. It will take you some time to recoup that money from rent, not counting what you might need to pour into it to fix it up.


 o
RE: Received a low appraisal from bank, now what?

From everything I read, banks have gone from one extreme of greed (lending to anyone with even a faint heartbeat) to the opposite extreme of fear (being super strict). Similarly, in a flat to declining real estate market, appraisers have gotten conservative with their valuations. As others have mentioned, you have been approved for a mortgage, but (if the Seller refuses to lower the price) you will need to come up with another $20,000 to add to the down payment. Good luck!


 o
RE: Received a low appraisal from bank, now what?

"Why is the price so high if the appraisal is so low?"

Because you failed to bargain for an appropriate price.

Sellers can ask whatever amo9unt they want, no one is required to pay the asking price.

If you really want to dig a hole but believe you can get out, have the seller hold a second for the $20,000.


 o
RE: Received a low appraisal from bank, now what?

"Why is the price so high if the appraisal is so low?"

Either you bid way too high or the appraisal stinks. Find out what comps the appraisal used and see if your realtor agrees that they are comparable properties. When we refinanced, the lender through out the first appraisal because some of the comps were way out of line.


 o
RE: Received a low appraisal from bank, now what?

OP, any response from either the bank or the seller?


 o
RE: Received a low appraisal from bank, now what?

We are in the opposition position (sellers). Have a contract to sell at one price with the appraisal coming in $10k less. The buyers said they could only go forward if we reduced everything down - we were giving them a new roof & $6500 closing costs. During the home inspection THEIR home inspector stated that the roof was good for another 5 years (it should be - it's 20 yrs old on a 25 yr roof). So we countered back on the appraisal that we would accept the lower price but pulled back the roof and dropped the closing costs to $3250. It's been a week and we just heard that they STILL want the roof and $4500 closing costs. (i.e. I feel they don't want to give up anything - this roof will cost us a good $6k - it has to be stripped and a new one put on). So now what? I really want the sale, hate to play "hard ball", but then again, feel like I'm being taken for a ride - having to have a roof job done on a house that doesn't need it. Attorney suggested maybe dollars towards a new roof? We've already completed most of the repairs on their punch list from the home inspection - and they know it - so they know we are trying to get everything in order. It's a good house.


 o
RE: Received a low appraisal from bank, now what?

If it were me, I wouldn't do it. Let them walk if they want to nickle/dime you. I guess its up to how fast you need to sell. It is Spring and showings should increase.

Jane


 o
RE: Received a low appraisal from bank, now what?

Thanks Jane - problem is - it's Mom's house, she died in September so we do need to sell it. We don't want to keep paying carrying costs on an empty house. We were very fortunate to get an offer (actually 3) 6 wks in and this one was full price (then minus the roof and closing costs).
What DH & I decided last night was - no roof, but we will give them an additional $2000 towards any repairs they feel are necessary - this will include the remaining roof repairs they requested - attic ventilation fan [no longer works - they wanted replaced], flashing [possible leak], vent pipe [they just added that in - no leak on them]. Or they can save it towards a new roof in 5 years.
This will bring them back up to their original $6500 closing costs - that's it. If they don't like it. They can walk. So I guess we'll see what happens. I feel like we're being quite flexible. But in this day and age - who knows.


 o
RE: Received a low appraisal from bank, now what?

Annie - it sounds to me like ya'll were reasonable and if you got that many offers then it is likely you can get other offers too. I hope your counter works out and this is it for you.


 o
RE: Received a low appraisal from bank, now what?

I am buying a house in Las Vegas, Nv. We offered $120,000 about a month ago, at the time the comp's where about $130,000, but we are concerned with this declining market that it should be lower, what can we do?
Check the comp's


 o
RE: Received a low appraisal from bank, now what?

"what can we do? "

Put more down to keep the mortgage % at the same level.


 o
RE: Received a low appraisal from bank, now what?

Maybe now's not the time to buy a house in NV if you aren't going to stay in it long enough for prices to rebound some?


 o Post a Follow-Up

Please Note: Only registered members are able to post messages to this forum.

    If you are a member, please log in.

    If you aren't yet a member, join now!


Return to the Buying and Selling Homes Forum

Information about Posting

  • You must be logged in to post a message. Once you are logged in, a posting window will appear at the bottom of the messages. If you are not a member, please register for an account.
  • Posting is a two-step process. Once you have composed your message, you will be taken to the preview page. You will then have a chance to review your post, make changes and upload photos.
  • After posting your message, you may need to refresh the forum page in order to see it.
  • Before posting copyrighted material, please read about Copyright and Fair Use.
  • We have a strict no-advertising policy!
  • If you would like to practice posting or uploading photos, please visit our Test forum.
  • If you need assistance, please Contact Us and we will be happy to help.


Learn more about in-text links on this page here