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Licensed Mortgage Loan Officer
100% Home Loans All Over Texas
Hope this helps.
Don Groff | REALTORÂ® & Mortgage Broker
Austin Real Estate Pros & 360 Lending Group
o 512.669.5599 | m 512.633.4157 | firstname.lastname@example.org
websites: http://www.AustinListed.com | http://www.360LendingGroup.com
While many people try to use size as a basis for their purchase, it should only be used as a guideline. Every house is different. Different locations, different features, different finishes, different appliances, etc. Only using price per sqft as an indicator of value is not the only measure.
With the TREC standard residential contact, if you are in the option period you can adjust price for any or no reason. Seller does not have to agree, but you can always negotiate. If you are outside of the option period you should ask your realtor for advice. There could be other options for example if the home did not meet the value of the contract.
The typical residential contract does not address this specifically. Some contracts do.
Would you want to pay more, or feel good if the appraisal came out bigger and the seller wanted more money? If not, I would think you would want a win-win deal and therefore not go back to the seller wanting to adjust sales price as they will likely feel the same way.
Every situation is different and you haven't given us the discrepancy...so we don't know if it is 3ft....or 300sqft, and we don't know where the original and discrepant numbers came from.
If after the "option period," you still can back out but may lose EMD.
The appraiser work for the lender. If the lender rejects and won't approve your loan or if the lender requires repair that is 5% higher than sale price, no one, seller and or buyer have to agree to it and both can withdraw and deposit will be turned to you.
I hope you have an agent to help you there. It's always good to have a real estate agent to represent you when you buy (or sell).
My opinion, worst case, I would rather lose the deposit than take in hundred of thousand of dollars for something I am not happy about.
Further thoughts, in this particular case, it depends on how big of the difference between the listing and the appraise -- in the living area. How significant is it? Remember, it can be an honest mistake. Bottom line, if all else is great, you like the house, and lender does not raise the red flag, then go for it. It comes down to personal preferences.
Note that the most appraisal districts (at least that I'm aware of) measure from the outside of the home and round to the nearest foot. If my math is correct, the home is about 3,850 sqft but was quoted about 3,927 sqft. Also note, the MLS discloses that the sqft is not guaranteed.
All pending sales in that price and square foot range have been on the market for a short time. Some sizes are per the CAD, some by builders, and some by appraisers. I would say there is a small possibility that the current appraisal is quoting the wrong sqft. If its a big concern, I would get a copy of the last appraisal and verify measurements and calculations to see for yourself.
You are free to haggle (assuming your are still in the option period) but just keep in mind that you risk loosing that home and you might be on the road looking again; new inspections, negotiations, etc
If you were #1 in a multiple offer situation, be glad and move on. The small difference is negligible, in my opinion.
On the other hand, if the property languished on the market and yours was the only offer after a reasonable marketing time and you have already negotiated a price that you find attractive, go for it. You may not be successful but you may find that the seller is willing to reduce the price for you rather than put the property back on the market and try to find a new buyer.
By the wayâ€¦what does your Realtor advise?
And here are the possible consequences:
1. Seller accepts revised price
2. Seller rejects modification.
3. Seller gives you ten seconds to accept original offer
4. Seller goes to back-up buyer #1.
5. Back-up buyer #1 dances in the street.
Your results may vary.
Best of success to you,
Annette Lawrence, Broker/Associate
Remax Realtec Group
Palm Harbor, FL
BHGRE Gary Greene
If the lender's underwriting department accepts the appraisal, you are good. If not, and you really want the home, your agent can fight it with comps. stats in the neighborhood and local area, etc. There are all all sorts of things a buyer can do including a personal letter to the lender about the home and how difficult it was to find one in this market.
This is just another reason why you need an agent to advise and work for you!
Best of luck!
Barb Kelley, Realtor, SRES, CHMS
Realtor, RE/MAX Realty center