Home Buying in Wheaton>Question Details

Rigo Gallego, Home Buyer in Phoenix, AZ

What if the appraisal on a foreclosed home comes back lower than your offer will the bank except the appraisal amount if the deal is near done?

Asked by Rigo Gallego, Phoenix, AZ Sat Apr 16, 2011

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6
Mike Hagen’s answer
You can also talk to your lender about getting a 2nd appraisal (usually at your expense). If the 2nd appraisal comes back higher, you may still be able to proceed with the loan, but get that in writing from you lender before you shell out for the 2nd appraisal.

You may also try talking to the bank which owns the property and get them to finance it at the agreed to price, or else the deal is dead (assuming you have the appraisal clause mentioned in previous answers).

Mike Hagen
Evergreen Real Estate
0 votes Thank Flag Link Sun Apr 17, 2011
Rigo,

This could present a dilemma since the bank had to do an appraisal or BPO's to execute their foreclosure. If you or your lender had an appraisal done that came in under the contract price, you should present this to the seller immediately.

As previously stated, your lender will likely not underwrite your loan if it does not appraise for at least the purchase amount.

Good luck,

Bill
0 votes Thank Flag Link Sat Apr 16, 2011
Your buyers agent probably put an "appraisal contingency" in your offer which states that they will sell you the house for the appraised value or you have the right to renig on the contract. And no, the bank won't finance a home for more than the appraised value.
0 votes Thank Flag Link Sat Apr 16, 2011
If you're financing this home, your mortgage lender won't underwrite the loan if it doesn't appraise out. It would be in the banks best interest to adjust the sales price to fit the appraisal.

If you planned on paying cash then you would want to have written in an appraisal contingency.

Of course, this question may be addressed in the addendums you would have signed at the time of accepted contract.

Check with your agent! They are there to represent you and help you in this process.

Best,
Michele Nixon
Web Reference: http://www.michelenixon.com
0 votes Thank Flag Link Sat Apr 16, 2011
Your buyers agent is professional to assist you regarding the executed sales offer and amendment

No professional can render an opinion on behalf of another party

Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
972-699-9111
http://www.lynn911.com
0 votes Thank Flag Link Sat Apr 16, 2011
Most contracts have an appraisal contingency that says it must appraise at or above purchase price (make sure yours does). I have personally had this happen and yes the bank dropped the price to the appraised value.
0 votes Thank Flag Link Sat Apr 16, 2011
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