Home Buying in Allen>Question Details

Niel, Home Buyer in Las Vegas, NV

Home appraised lower than purchase price.

Asked by Niel, Las Vegas, NV Mon Jul 29, 2013


We are have a Preowned Shadock home in West Allen,TX under contract for 460k for 4462 sq ft home. But house appraised value based on sales comparison approach came to 434k. Appraised Value based on cost based approach is coming to 452k. Around same size Adjacent home was Windsor Home and was sold 426k recently. Seller has house appraisal from 2010, which states the appraised value at 457k.

We have disputed the appraisal, since seller is not negotiating.Any advice will be helpful.


Help the community by answering this question:


Is the home listed with a Realtor or is the seller selling on their own? This is a critical point because if there's no listing agent, the seller doesn't have a professional resource to advise on the appropriate course of action. I'm guessing you don't have an agent either, so both buyer and seller are at a disadvantage. If the seller won't negotiate and you can't get a revised appraisal you'll have to pay the difference or just move on. If you elect to withdraw from the contract, please consider using a Realtor for your next home purchase. Even if the property you want is for sale by owner, a Realtor can still represent you. Good luck!
1 vote Thank Flag Link Mon Jul 29, 2013
Hi Niel-

An appraisal from 2010 has no value today and can't be used, it's too old. It certainly sounds like the sellers have their home overpriced and the current appraisal reflects that.

Why isn't your real estate agent helping you with these questions?

As listed below the only options you have are:

-Walk away from the purchase, a lender will not loan that amount.
- You pay the difference - it will have to be cash because the lender will not loan that amount
-Your agent negotiates with the sellers and they drop the sales price to the appraised price
- You and the seller negotiate and meet halfway-seller drops and you pay cash for your half

Again this should be coming from your real estate agent.

Hope it helps,

Sherry Renfroe
Ebby Halliday Realtors
Mobile Site: m.sherryrenfroe.com
1 vote Thank Flag Link Mon Jul 29, 2013
A 2010 appraisal is not worth putting under the bird in the bird cage. It's worthless. Your seller over priced the house and unless your appraiser can find justification to make it higher you have these options:

walk away

you bring more money to the closing

seller drops price

you both meet in the middle somewhere and you bring money to the closing

Good luck
1 vote Thank Flag Link Mon Jul 29, 2013
I agree, it sounds like the seller is overpricing the house. I wouldn't bother with this whole situation. Usually appraisers know what they are doing, and they don't usually underestimate the value of a home. I would talk to a realtor if you have any other questions. http://www.appraisalkeys.com/
Flag Fri Jan 30, 2015
Did you even read the question?
0 votes Thank Flag Link Sat Aug 17, 2013
Sounds like you are selling FSBO. Check out my fsbo tips. I have a network of really good agents if you need a free referral. Best Wishes, Gerry
0 votes Thank Flag Link Sat Aug 17, 2013
This looks like to me that , you don't have buyer representation (Realtor) and dealing directly with FSBO. And this property is not listed for sale in MLS. (Multiple Listing Service for Realtor)

You have to sit down with seller discuss with the help of your agent ( if you have any ), either seller has to come down in price or in other case you have to pay the difference from you pocket.
If you are not in so much so in love with this property, my suggestion to you is to you is cancel this contract if seller don't cooperate with you, find another home in this area or different subdivision that fits to your family needs and budget. Bank will give you loan on which ever is the lowest, sale price or appraised value minus the down payment.
0 votes Thank Flag Link Sun Aug 4, 2013
Sellers are pre-conditioned to deal with low ball offers and even a banks FIAT appraisal. Here in Florida we deal with appraisal gaps in excess of $50,000 ALL THE TIME. The result is the represented SELLER IS NOT ALLOWED TO TAKE THE HIT! The BUYER pays fair market value! Fair market value and a big banks appraisal have only one thing in common, the same alphabet. The seller will be protected from FIAT bank appriasals. A big bank backed offer will be kicked promptly to the curb. The buyer does have a choice regarding the lender they choose. That choice is not the sellers responsibility to accomidate.
And it is true...you won't be the last or only buyer for an attractive home. As Micheal reported, if this home is actually NOT FOR SALE, you should expect to pay MORE!
If you really want the house, you need to engage real skills of a negotiator.
Your agent will have assessed the seller's real motivation and from that can allow you to construct other terms and conditions that will have value to the owner. Price, although important, is not the only value found in a prucahse agreement.
Don't make the mistake of thinking the seller will negotate with a party who is not part of the transaction. The seller will negotiate with you.
Regroup with your consutant.
Create your win/win strategy. (that IS what you want, right?)
Present a new offer.
Seal the deal
Find a different house.
You have many options. You, must be willing to adapt to them and allow the pros to do what pros do....create solutions that solve the many obstacles that lie between the successful sale and purchase of real estate. We do it dozens of times every year.

Best of success to you,
Annette Lawrence, Broker/Associate
Remax Realtec Group
Palm Harbor, FL
0 votes Thank Flag Link Mon Jul 29, 2013
Good Afternoon Niel,

I'm terribly sorry that you are going through this. I did look up the information based on the details you gave us. Are you being represented by a buyer's agent or is the listing agent acting as intermediary? Have you asked your agent what your options are? Yes, you can dispute the appraisal. Your lender would have to dispute this but it is an option. Your other options that other agents have mention is to pay the whole difference or go half of the difference with the seller or you can terminate the contract. I would recommend discussing your options with both your agent and your lender.

I hope this information from me and the other agents and loan officers have helped. Please keep us posted.

Make it a Great Day!

Tamika A. Goree
Broker | Owner
The DFW Property Shop
Direct: 972.697.1178
Fax: 972.665.7148
Email: tgoree@thedfwpropertyshop.com
0 votes Thank Flag Link Mon Jul 29, 2013
Definitely have your agent assist you. The options are:
1. pay the amount out of pocket for the difference
2. split the difference with the sellers
3. terminate the contract and find another home to buy

Please know that any amounts that you pay out of pocket above the appraised value has to be paid by you at closing and it cannot be financed/mortgaged. Please know that you will still have to qualify for the current mortgage you are getting even after spending that money out of pocket (sometimes it changes your qualification).

Good luck!
Melissa Hailey - North Texas Top Team, Realtors
Coldwell Banker Jane Henry Realtors

0 votes Thank Flag Link Mon Jul 29, 2013
Your agent should be assisting you on this. However, having said that an appraisal from 2010 is way too old that it will not reflect the correct value of the home. If the sellers are not reasonable you can always walk away from it, OR if you really have to have the home you can always negotiate and meet the sellers half way, sellers reduce $13k in price and your contribute out of pocket $13k. Again, all these should be coming from your agent.

Good luck,
Susie Kay, Realtor®
United Real Estate
III Lincoln Centre, 5430 LBJ Freeway #280
Dallas, TX 78240


Servicing your real estate need is my priority!
0 votes Thank Flag Link Mon Jul 29, 2013
I agree with the answers below. If the seller will not negotiate, he either hopes somebody else will come along and agree to pay cash (no appraisal), or he doesn't really need to sell now. Before you put in your offer, didn't you look at the comparable sales history in the area to help determine your offer?

Good luck!
Barbara Coker
Licensed Mortgage Loan Officer
100% Home Loans All Over Texas!
0 votes Thank Flag Link Mon Jul 29, 2013
I have looked for the home you are attempting to purchase. I do not see it listed in our MLS. I think you are attempting to purchase directly from a seller. If this is the case be careful. I believe the comment about paying the difference is correct if you just have to have this home. Working with a Realtor who knows the area is more valuable than most people think. There are several of us here Niel, choose one and hire them.
Best advise that I can give you!
0 votes Thank Flag Link Mon Jul 29, 2013
I am using Realtor. I am not buying from seller directly.
Flag Mon Jul 29, 2013
You do a good job of arguing FOR the seller:
You want to pay too much for the house!
Find the extra money and you can have it.
0 votes Thank Flag Link Mon Jul 29, 2013
Your Realtor should be assisting you with all these details. In some instances the listing agent does not know how to comp a property prior to listing therefore it can cause issues of seller price point to.

Your lender will not approve a loan if it does not appraise for value. So either it is resolved OR move onto search for another property.

My website is updated daily therefore saves you time search accurate information

Contact my office today where I can show you many amazing homes work with your family specifications.
Lynn911 Dallas Realtor & Consultant
Multimillion Dollar Sales Producer
http://www.lynn911.com 100's of Dallas homes listed for sale or lease

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0 votes Thank Flag Link Mon Jul 29, 2013
Niel, I agree with what Tim said, your options are pretty limited. The listing agent should be providing the data to support the dispute and therefore the sales price, but a 2010 appraisal is meaningless. On the dispute really the main recourse is to show that the appraiser missed homes that were more comparable or that upgrades in the home you are buying weren't given enough value, and they would likely need to be upgrades the comparable homes don't have.

Any difference between your ultimate agreed price and the appraised value will need to be bridged by cash from you. You can also walk away, and you should be able to get your earnest money back per paragraph 4 of the contract; talk to your agent about that.

Good luck.
0 votes Thank Flag Link Mon Jul 29, 2013
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