Good luck to you.
REALTOR | Mortgage Broker | Consultant
Buy - Sell - Lease - Invest
Keller Williams Realty | 360 Lending Group
Total Real Estate Services
This is what TJ emailed to me! He got upset that I told him that he needed to be represented by an agent!
"You comments on Truila to the question about an appraisal coming in few thousand under asking price was uncalled for. You totally jumped to a WRONG conclusion. I should post this email on Trulia for all to see, but I will not lower myself to your standards. First of all, I asked this question for my niece ... AND THE HOUSE IS LISTED WITH A realtor and YES a realtor showed the house to my niece. BUT my niece doesn't quite trust the realtor, as most folks don't! So many realtors are just concerned about THEIR bottom line. My niece has not even made an offer on the house .... there have been 3 other homes in the area that have appraised for $3,000.00 - $5,000.00 less than asking price. She asked me if I knew what would happen in this case. I felt that the answer was she could still get the loan as long as she didn't have a problem paying the money and that would be if the seller did not want to lower the price to match. It was the "realtor" that told my niece about the other appraisals AND ONE OF THE HOUSES hasn't even closed. This realtor is telling things she should be keeping to herself.... thus she doesn't trust her!!! So next time think before you jump to conclusions .... seems you have a chip on your shoulder. Don't bother replying as I WILL NOT open your email, I will delete without reading."
I was just trying to let him know the reason that it is important to be represented! Oh well, I bet he/she will hire an agent next time!
It likely would be approved, but speak to the lender to see what they say your "options" are. You might also want to go back to the seller and see if they would lower the price to match the appraisal. You can always protest the appraisal and see if the appraiser will review and adjust the report after listening to your (or your agents) reasons the value should be higher.
Sometimes the appraisal can come in below the agreed to sales price and your loan STILL gets approved because you are such a great buyer and there is little risk to the lender (20% down). I always want my buyers to decide if they will go forward if an appraisal is not in-line with the contract, not the lender!
Sounds like your close to a deal. Keep working on it. Let us know if we can be of assistance.
The answer is "probably." It all depends on your lender. If the lender was willing to loan at the sales price and you are making a 20% down payment based upon that price - which is more than 20% of the appraised value - AND paying the difference between the appraisal and the sales price, then the loan-to-value risk for the lender actually is reduced, so it would seem the lender would still approve your loan. HOWEVER, this is something you have to discuss with your lender.
One appraisal can be as different from the next...they are merely an opinion and bank appraisals are done from the perspective of protecting the assets of the bank, not you or the seller. If your agent did a CMA and you feel the price is consistent with the market and what you are willing to spend that should be your major concern. Discuss your options with your Buyer's agent.
Your buyers agent, loan officer should be assisting you
Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors