I feel for you. I just had a deal fall apart for this very same reason. I had a seller (who doesn't even reside in the property) get cold feet thinking their property is worth so much more. The home generously appraised for $300,000, but my client was coming to the table with an additional $5,000 as the purchase price was $305,000.

My recommendation after going back and forth with my buyer and this seller is to provide them the full appraisal, your offer and your deadline. If it is accepted, sign on the dotted line by your deadline.

If not accepted, move on. AND OH - - - BTW . . . get an on or before 45 day (OR LONGER) closing period. I'll tell you why. Right now it is very difficult to get 30 day closings as it takes 8-12 days just to get the appraisal done. If you do not get your financing (which is almost impossible in 30 days anymore), then you will have to provide notice to the seller and either request an extension or terminate the contract due to lack of financing. If you do not do this, you risk your entire deposit.

If they decide NOT to provide the extension due to "cold feet" "seller's remorse", you are out $2,000 in inspection fees, surveys, title searches, etc.

GETTING A LONGER CLOSING DATE IS REQUIRED FOR ALL DEALS ANYMORE!! BETTER TO BE SAFE THAN SORRY!! Do not EVER depend on an extension, as sometimes the SELLER or BUYER will not provide and the buyer will be out a lot of money.

Good luck to you!

Lisa M. Brodeur
LMB Realty Corp d/b/a Alliance Realty
lmbrealtycorp@aol.com
(954) 868-1416

In many markets and neighborhoods in South Florida homes in mid-priced and lower range have seen their prices going up for several months now. Our buying season in Florida is just a few months away and expect the prices to creep up a little more as the demand does on these homes. Its the upper-end luxury homes that are taking a hit on price now and have not bottomed yet. The upper priced luxury homes probably have a year or two left in price declines.

Do I think the market is going to decline that much anymore? - No not really. The tax credit should help neutralizing the decline somewhat and hopefully the unemployment rate will hault.

Why does the seller have to sell? I do feel bad for people losing money as well but then again if a seller does not have to sell then they should ride it out until they are happy with their sale. Otherwise it causes these headaches for a transaction.

Seems like you have a good plan of action there. Report back what happens.


Sean Dawes

First and foremost, I want to thank all of you for taking the time to post your thoughts on here. I'm very happy that I found this site and the resources that all of you are giving on here. I think we're going to handle it like this:

I'm going to attempt to arrange a sit down or a conference call between myself, the seller, and both realtors and see if we can't figure out what's going wrong.

I'm also going to attempt to have my lender get in touch with her appraiser. According to my realtor (and it's only what's been told to me), this appraisal that she had done was so far off that he says that the appraiser could be reported. He (the appraiser), says he'll stand by his appraisal in court if he has to. I'd like my lender and his appraiser to speak with her appraiser, go through the appraisal, and figure out who is being honest about their work.

If our appraisal stands (230,000), then i'll try to appeal to her and explain that from everything I've read, the market here is still going down and probably will be for a year or two. Since her home appraisal value will also keep going down, it's in everyone's best interest for her to sell to us for the appraised 230,000 now. Unless she can hold on to it for a few years and wait for the value to go back up. The only other option I see is for her to wait for a non-FHA cash buyer willing to spend an extra 15-20 thousand over the appraised price in cash, which seems like it's unlikely, but what do I know, this is the first time I've been involved with this.

I honestly feel for her, she's put a lot of money in upgrades into the home (70,000 in the past 2 years according to her) but we can only get financed for the appraised price, and at the same time we don't want to pay more then the home is currently worth, even if it's likely to go up in value after a few years because we don't have all that extra money just sitting around. Are we thinking wrong here? Are my findings about the market continuing to go down for a while correct in your eyes? Do any of you think there's a better way to handle this? Again, your opinions and advice are VERY much appreciated. Thanks again.

because an appraisal, especially with the new appraisal rules in the South Florida market, isn't necessarally the true value of the house. The true value is what a buyer is ready, willing and able to pay. Many deals fall through in South Florida because an out of area appraiser, appraisers the house below what the buyer is willing to pay. Some of these appraisiers don't know the neighbor and what a good comp is and often they are using foreclosures or short sales in very bad shape as comps for a "dream house"

many of these houses in South Florida are priced artifically low because of the weight of all the foreclosures - they are under valued. When we get through the foreclosures, prices will go back up to more of a market price and if you don't work to buy your "dream home" today that you were willing to pay $260,000 for then you will probably regret it. Also, besides the low prices, interest rate are being kept artifically low by the Fed. How long can that last???

Even if you could use an appraisal that is 4 months old. Why would you as a buyer want to do that? If the recent comps are lower, then what makes this home worth more. A market can change in 4 months and you should not have to inflate your purchase price to reflect a value a homeowner expects to pay.

If I gave you a $1 bill to sell for $1.50 how many people could you get to buy it? Not many. Same rule applies. Why pay more for what you know it is worth.



Sean Dawes

I'm pretty sure that the appraisal has to be less then three months old. Also, there are new, strict guidelines for appraisers this year and appraisals have been coming in low. You can challenge the appraisal and maybe get a higher one. One of the agents involved should have recent comps available for the appraiser to show the higher value.

Just got more info. Seller says that she had appraisal done by FHA appraiser (260,000) about 4 months before our bid, and was told that for a small fee that that appraisal could be used by a buyer in the future. She told her realtor this, but her realtor never told us about that, so we had our own done (230,000 by FHA appraiser). Is this true? Would an appraisal done by the seller 4 months ago be able to be used by us? She also says that there was never an appraisal done for 220,000, as my realtor stated to us and that she hasn't accepted any other offers nor does she know where he got that from. Not sure if my realtor is making some things up but we will confront him to find out tomorrow. My lender has locked the 230,000 appraisal into FHA, which he says means it is the only appraisal an FHA loan can use for 6 months. We want to know: Can we have another independent appraisal done by an FHA appraiser, or is the locked in amount just going to be the final amount no matter what? She really feels like she's not getting what her home is worth, but if our appraiser put it at 230,000, and another home that is the exact same model just closed for 200,000 and it's on a golf course (ours is just a regular backyard), isn't it more likely that the value of our appraisal is correct? We just want to work this out. We really need help.

Have they lived in their current home for 5 years or more? And are they trading up? If so they now should qualify for the step up part of the tax credit just released!

$6,500 tax credit for step up buyers..Take a look here for more info http://seandawes.com/?p=282

Use this as leverage. Express the fact they will not sell the house if it doesnt appraise unless how I stated below.

Hopefully this puts you $6,500 closer to closing your deal!


Sean Dawes

If this is truely your dream home then I would keep on working with it until you get it. A good question for the seller might be, "What do you need to see- us to do - in order for you to be comfortable with our appraisal?"

The seller might be right in one respect - many houses on the market today are undervalued. It makes it great for buyers but tough on sellers. So cut her some slack, especially if she is older and/or has owned the house for a long time, she may be in shock.

Sellers can be difficult at times. They can have big emotional attachments to the home or not ready to walk for less than either they paid or what they thought it was worth. But at the end of the day if you are not making any progress, you need to let the seller know that no one will be able to buy the house unless it appraises (unless its a cash buyer or a buyer who for some reason wants to overpay for a house). Just not happening. If they dont become realistic and you are under a time constraint you might have to move elsewhere. If you dont have to get a home asap, then ride it out and wait for them to come to their senses.


Sean Dawes