On an fha appraisal, the appraisal will now stay with the property. If they don't have the money, either agents have to reduce their commission or you have to go with it. You can also cancel the deal and look for another offer.

Thu May 22 2008, 09:02

Hi Everyone:
Thanks for all your help and comments. We have reached an agreement with the buyer and we are going forward with the sale. We will be loosing some money but at least we will not loose the new house we want. I hope that we will get some money back the next time I sell.
Thanks, Jeannie

Thu May 15 2008, 16:41

Wow, Jeannie!

You lowered your price and attracted three offers and now the appraisal won't cover your sales price? You are going through it aren't you! Well, here's a couple of ideas. Did any of the three offers have a better way to purchase your house than the one you accepted? In other words, did one of the other offers have more money down or a better overall position that would allow you to move forward with that offer after your terminate this one.

Secondly, you could ask for a second appraisal to be done. Often the lender could call another appraiser and ask them if they can match the sales price with the comparables available. You want to know in advance of ordering that appraisal of how the underwriter will look at that additional information.

A third option if you can hamdle not receiving the income until later is to explore carrying back a second mortgage with payments, if that doesn't knock your buyer out because of the increased debt ratio with another payment.

See if any of those ideas work.

Thu May 15 2008, 14:48

Jeannie,

I undestand your frustrations, we all have them in this market, but lets be fair. Just think, if those lenders never lent the money to the people that did not qualify, home prices would have never gone up the way they did. Therefore you would have never gained that appreciation in the first place. Also, FHA was availible 3 years ago and if people used it we would have never had this subprime mess we have today. I bet you wouldnt complain about those lenders today if it qualified your borrower to sell your house for what you want.

Bottom line FHA qualifies people to buy houses based off of their income. If the medium income doesnt support the values in your neighborhood, your home prices are inflated. you cant expect the average home in an area to sell for 250k when the average household rakes in 50k.

Tue May 13 2008, 08:47

Ryan:
The house was priced according to what my realtor told me was fair on this market. I bought this house for 175,000 3 years ago and we put 25,000 of upgrades for our convinience. All I am saying is that we worked realy hard to save our down payment before we bought this house and now people are able to buy houses using FHA and getting the seller to pay their down payment. This is all happening because a couple of years ago Mortgage companies lended money to people without considering if they could affor it or not. You are right I do not have to sell, I love my house the only reason we are selling it is so that we can get more space. I am just frustrated that responsible people like us have to suffer because of others mistakes.

Tue May 13 2008, 08:17

Then dont sell Michael. Dont blame the buyer considering he is buying your house for over market value. You should be happy you found some crazy enough to close on a overpriced house. If it wasnt for FHA you wouldnt be selling at all.

Mon May 12 2008, 09:04

Michel:
I do not mind selling it for the value of the house or what it appraised for. The problem is that I do not think my buyer could buy it a this ammount unless I provide the 6% and that I can't do. Even if I could turn arround and do the same to someone else I will not have any money for a down payment and this is the only way I will buy a house.

This FHA thing is horrible for sellers. Not only is the market low and we have to sell for what we bought but on top of that I have to provide closing costs and down payment for the buyer. I do not understand how this is even available. You either have the money or you don't. Do not buy a house or put an offer if you can not afford the other expenses involved in the transaction. Sorry I had to vent. Thanks for all the advise.

Sun May 11 2008, 14:07

Don't lose the buyer. Sell the house what what it is worth. And that's the appraised value. You will lose more money by hanging onto it. Become a buyer again and get even!!!

Michel

Sun May 11 2008, 05:37

I don't have any more guidence for you than the other Realtors. Sarasota Sellers are facing more of this type of situation, especially in the FHA. Re-negotiate if contract allows..

Sat May 10 2008, 22:45

Jeannie,
You have been given some great counsel. Unfortunately, your circumstances are not the exception in the current real estate market. We are sorry you find yourself caught up in such a troubling situation. Trust that somehow things will work out.

Sat May 10 2008, 20:45

Hi Lisa:
She offered 185,000 and the house appraised at 175,000. In Zillow it states that my house is worth 181,000. At 175,000 there is no much more mony I can give towards the closing. I bought the house at 175 3 years ago and remodeled the kitchens and bathrooms. I was already loosing money with the original sale agrrement and now I will not have enough for a down payment. I am so sad. Thank you for answering my question so fast.

Sat May 10 2008, 18:59

Jeannie:

This is a problem we have been facing lately and unfortunately there are not a lot of options. You and the buyers will have to work from the number that was established by the appraiser. I have had second appraisals done, but often the lender forces you to use an average between the two, or could simply force you to use the first appraisal.

Buyers are willing, because they realize we are in a market of opportunity for them, but the lenders are tough. Unless you have a cash buyer, you have to play by the lender's rules. You didn't mention your sale price. 6% is the maximum amount for closing costs and pre-paids for an FHA loan. If the loan is at the high end of compliance (low 300,000) you are looking at a seller contribution of 18,000. Closing costs on a $300,000 home should not even come close to that number. Sounds like everyone needs to sharpen their pencils and compromise.

Jeannie, don't throw away a serious and qualified buyer. You will only be in the same situation with a new lender. The days of easy money and generous appraisals are gone. If you want to gamble that a new buyer will come along before all of the foreclosures and short sales lower the comparables even more, it is up to you. My money would be on working this out even if it means taking a loss.

Before you think I am all doom and gloom... I want to remind you that you are one of the blessed sellers with a contract on your home... if you can close this, you will move on with your life and possibly take advantage of the buyer's market when you purchase your new home...Lisa

Sat May 10 2008, 18:48

Youar purchase agreement should have verbiage that describes what happens to the agreement in case your situation happens. The typical wording would indicate that the buyer can reject and terminate the agreement, accept the lower appraisal and still purchase the property at the offered price, or renegotiate the agreement with the seller.

Sat May 10 2008, 18:37

Most likely the lender will not fund the loan unless the buyer makes up the difference between the purchase and appraisal price. Alternatively, the purchase price can be adjusted. Without those concessions, the deal will most likely be terminated under a mortgage contingency clause.

Sat May 10 2008, 18:35