Home Buying in Portland>Question Details

Geraldj100, Renter in

Almost ready to finalize deal on house when appraisal (s) came in way lower. Had asked for 2d appraisal as S and I both shocked.

Asked by Geraldj100, Wed Oct 3, 2012

Seller couldn't come down much and my mortgage broker could not justify ( I don't have $ to pay difference). Now S has it listed again with new company/agent but same list price I had offered on. What should I do?

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6
You didin't mention if your loan was an FHA. If it is an FHA the loan, the value is stuck on that house for 6 months and no one can get loan above that price. If that is a conventional loan the information below is pretty much what I would do get another appraisal and if you like house get some comps to prove price.
Tom Inglesby,
RE/MAX Equity Group
tinglesby@remax.net
0 votes Thank Flag Link Wed Oct 3, 2012
If you want to buy this property you can submit a new offer. Have your broker contact the new listing broker and see if the two can come up with a price that can be strongly supported by comparables. Your new offer can be subject to the appraisal, and get the listing agent on board to meet the appraiser at the property to provide the comparables used to support the price. The problem is, if the appraisal you already paid for (and don't forget, a new offer means a new charge for a new appraisal) is actually correct, then you are going to be out the money and the seller is going to be stuck with an urealistic price and the consequences of listing the property too high. Be sure your lender will go with you on this tack; otherwise, move on to a different property. As you proceed in the market, your real estate broker should do the research to support the price of the properties you are interested in so this disappointment does not occur again. Appraisals can be tricky. Discuss the pitfalls and how to avoid problems with both your lender and your broker. Best of luck. I am sorry this happened to you. Karla Divine,
Principal Broker Divine NW Realty
503-819-6923
0 votes Thank Flag Link Wed Oct 3, 2012
G: I have had similar experiences! Not so much lately, but definitely in the last couple of years. I have been successful challenging the appraised value by coming up with good comparable properties that prove my value. They may not come all the way up to your negotiated value, but it can make a difference as to how or whether the transaction can be re-negotiated and closed.
Good luck
Janeese Jackson
"your" Real Estate Resource
503-709-0802
0 votes Thank Flag Link Wed Oct 3, 2012
Seems like seller is wasting everyone's time not knowing all the details of what the difference is. Appraisals are just one person’s opinion of value with more than one person/appraisal you get more than one value. Also appraisals lag the market because they rely on current solds to determine value, if there are no current solds then they adjust to what they have and that adds to the variance. So seller is hoping for a buyer that has more money and really wants the property to come in and make up the difference which is very common in California but not here.

You could try another offer, most likely you need to move on.

Kevin Sucher
Principal Broker
503-214-4139
ksucher@prunw.com
0 votes Thank Flag Link Wed Oct 3, 2012
Hi Gerald,
Unfortunately, your experience is not unique. Apprails often come in under the agreed-upon sale price. Although home prices in the Portland Metro area are starting to climb, appraisers look at historical sale prices over the last several months. Also, appraisals are based on opinions and each appraiser approaches his/her job a bit differently--some adjust liberally for school district, location, and amenities. Others just seem to look at an average cost per square foot.

Since you nor the seller had the cash to come up with the difference between sale price and appraisal, the transaction was terminated and the seller put the house back on the market. If you were using an FHA loan to purchase this house, an FHA case number would have been opened. It is my understanding that the case number and appraisal remain attached to that house for six months. So, other buyers using FHA loans would be stuck with that appraisal for that time period. However, VA or conventional buyers would obtain their own appraisal and a new appraiser could come up with a completely different value for the house.

Your buyer's agent can put together a current market analysis for this house to determine if the list price is easily supported now. If it has been more than six months since your original offer was made, or you are not using and FHA loan to purchase, you could make another offer on the house. You would still incur a cost of a new appraisal, but if you really love the house, it might be worth considering.

Best wishes to you.
Sally Mehalovich, Oregon Principal Broker
Amerivest Realty of Portland
http://www.PDXHomePros.com
0 votes Thank Flag Link Wed Oct 3, 2012
Seller's agent should be fighting for that second appraisal. In the meantime you could put in an offer at the lower, appraised value. They already know they can't get it funded above that until it is re-appraised.
0 votes Thank Flag Link Wed Oct 3, 2012
the previous S agent indeed fidget 2d appraisal that came in identical to first. S took house off market for a month, then put back on with new realty company, but original list price. How can they do that?
Flag Wed Oct 3, 2012
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