Home Buying in Tacoma>Question Details

toronto1morr…, Home Buyer in Tacoma, WA

APPRAISAL OF A HOME

Asked by toronto1morris, Tacoma, WA Wed Jun 27, 2012

We recently had a home appraised and it came under the amount that the owner wants, unfortunately we can only get the loan if they come down in price and have a few things repaired. The question here is the way in which things are being done leaves us feeling vunerable for we had to pay for the Appraisal $500, even if the sale does not go through and the inspection. How to protect ourselves in future while using the first time home owners loan.

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6
Ron Thomas’ answer
It sounds like you did not have a Realtor do a CMA before hand;
to determine the Market Value of the house:
If you had, you wouldn't have offered so much, and you wouldn't be in this position.

You assumed that the LISTING PRICE was an accurate indication of the worth of the house;
your second mistake.

The next you find a house, enlist the help of a Realtor to protect your interest.
That is what we are there for.
1 vote Thank Flag Link Thu Jun 28, 2012
Thank you, its great to have such wonderful people out there helping us out. we now can have a better chance at getting our dream home.
Flag Thu Jun 28, 2012
Write your offer with the seller paying your lender for the appraisal, you can always reimburse the seller at the closing if you are willing to pay it. Just spell it all out in the offer. I posted something related to this subject on my blog recently, linked to it below, good luck,

Jim Simms
NMLS # 6395
JSimms@cmcloans.com
Financing Kentucky One Home at a Time
0 votes Thank Flag Link Thu Jun 28, 2012
Thank you that is a great idea.
Flag Thu Jun 28, 2012
and,oh yes, before you make an offer on any home, make sure you pull a new set of listings, closed sales in the area and determine what you will want to offer based on your research. Don't let the realtor tell you the line about how the house is going to go away and never be avaiable. There will always be another home,but at the price that is correct for you and your family.
0 votes Thank Flag Link Thu Jun 28, 2012
Thank you
Flag Thu Jun 28, 2012
The bank appraisal is looking out for the bank. You should look out for yourself. You can hire an appraiser to complete a driveby appraisal or a full appraisal.

The real issue is that the bank does not want to loan money on a home if they can not sell it and get their money back.

If you put more money down, the bank will let you buy a home that is overprices because they are taken less risk and you are taking more.

The bank is protecting themselves and, in turn is protecting. You should feel the same way about this. If the home is prices too high, you do not want to run in and buy an over-prices home, do you?

Your realtor should be competent enough to look at closed sales and listings to see if you are about to pay too much. If not, find a different realtor or hire an appraiser. This is much better than losing 10,000 or $50,000 just like that.
0 votes Thank Flag Link Thu Jun 28, 2012
Although this isn't 100% accurate, having a good agent who specializes in the area in which you are buying is a starting point. The agent should prepare a market analysis for you, just as [she] would do for a seller wishing to list the house. The analysis should include at least 5 sold properties that are located close to the subject house, have the same general design (one story, two story, two story plus basement, etc), be about the same size and be in the same condition with the same amenities as the house you want to buy. This is exactly what the appraiser does, except that the appraiser does it a lot more! Ask you agent how close to the asking price his/her listings sell.

You also need an agent who knows houses inside out: that is, how they are built, something about electrical, plumbing and heating systems, roof longevity, etc. As you look at a house, you and your agent should be discussing the condition and what might be found during an inspection.

Going into an offer blind is bound to cost you money (but, hopefully, not as much as the couple in The Money Pit). Buyer's Agents owe you some expertise. Shop wisely for an agent and you won't find yourself spending for inspections and appraisals that can be avoided.
0 votes Thank Flag Link Wed Jun 27, 2012
We actually had our agent do all of the above mentioned, unfortunately the owner of the house is unwilling to come down on price. There is more to this story but it has basically ended. She also was under the impression that she had a new Gas furnace which it was not it was old and electric,lol. I don't know but it has been a learning experience. This entire process has me concerned,
Flag Wed Jun 27, 2012
write a comment...By the way cute dog, :)
Flag Wed Jun 27, 2012
Do you know of anybody that you can suggest, for the first time home owners loans, I really need somebody that can be on top of these types of loans.
Flag Wed Jun 27, 2012
Toronto,
You may consider this the cost of doing business and money well spent, if you get the house. Otherwise, it's hard to say. As a buyer's agent, I provide my own "pre-inspection" looking out for things which the inspector or appraiser will find. While I'm not a licensed appraiser, I have a background in construction and HVAC and have attended hundreds of inspections over the years. I find that this can be a huge help for my buyers when we see issues upfront and can decide how we want to address them in the purchase process.
The issue of the appraiser is somewhat different. An appraisal is an "opinion of value" and two competent appraisers may come to different conclusions. If the value is way off, your broker should have caught this and advised you when they completed a comparative market analysis. A CMA is not as detailed as an appraisal, but would generally indicate if things are close or not. A CMA can also be used to dispute an appraisal if the appraiser did not choose the best comparables in their analysis.
A great Broker/Agent looks out for their buyer's in these areas and "may" have caught some or all, but depending on what the issues are, may not have been able to. I hope this helps.
0 votes Thank Flag Link Wed Jun 27, 2012
Thank you,
Flag Wed Jun 27, 2012
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