Home Buying in Village 12>Question Details

sharita1026, Home Buyer in Williamsburg, VA

hi I am about to buy a house for 109,900. But the appraised at 103,300 with should I do . thanks Sharita

Asked by sharita1026, Williamsburg, VA Tue Apr 16, 2013

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Matt Bistis’ answer
Don't think anyone addressed an important issue: if the loan is FHA, I don't think they allow you to make up the difference...the appraisal has to be as much or higher than the sales price. The appraisal can be challanged (ask your lender how) but it is tedious & takes more time. Otherwise agreed with the other answers.
0 votes Thank Flag Link Wed Apr 17, 2013
You could try and negotiate with the seller, probably meeting in the middle. If this is a property you really want pay the difference , that is if you have the money to do so.

Walking away is also an option.
0 votes Thank Flag Link Tue Apr 16, 2013
I think you have all of the options that you can choose from. In the Sacramento market, there is so much competition for a home, that homes are being purchased above any recent sold values.

If you are a buyer competing for a home with others, there are strategies to make sure you are competitive in your offer. Since over 37% of our offers are cash buyers, they don't even have a loan or appraisal contingency. Plus, they can close in 10-15 days so they win against a buyer who even has a loan. Many buyers with loans actually guarantee to pay the difference from the appraised value if it comes in lower to remove that 'negative' from their selection against a cash buyer. When that is the case, it's common for an agent to attend when the appraiser appraises the home. While it is illegal to try to influence the value findings of the home, it is not illegal to provide data that might not be available to an appraiser from another source- such as other homes, how many offers that they received, the offer price accepted (even if it hasn't closed yet), details on amenities and condition on some of the comparables that they might be considering. More data, means the appraiser has more information to provide a more accurate valuation and possibly come in closer to the offered price if it makes sense.

So as you consider which option you take, consider the alternatives that the seller has in response. This is the time for a good negotiator on your side. Good luck!
0 votes Thank Flag Link Tue Apr 16, 2013
You have 2 choices. Renegotiate price with the seller or put a larger amount down.
0 votes Thank Flag Link Tue Apr 16, 2013
Hi Sharita

Depending on the type of loan a buyer is getting and their down payment, the options in general are:

1. Re-negotiate the purchase price with the Seller

2. Pay the difference (if a Buyer were not putting very much down to being with and need to bring in the difference)

3. Don't complete the purchase

Many markets are changing for the better, so it all depends on the details of your contract and situation please speak with your agent & your lender as they will know best your contract and loan details and what applies in your State..
0 votes Thank Flag Link Tue Apr 16, 2013
Negotiate with the seller to see if they will meet you half way or the market is anything like it is here in Sacramento , just pay the difference and get your home .
0 votes Thank Flag Link Tue Apr 16, 2013
In Sacramento, we are seeing many buyers bring in the extra cash to purchase the home, because the market is hot, and if they don't close the deal, they will lose the house to another buyer willing to bring in extra money.
The good thing about all of this is, the home's value--if it were in Sacramento-- will go up exponentially in the next 3-6 months, and so the average buyer here isn't worried about buying "above market" or being upside down. They know the market and value will catch up with them quickly and gain more value quickly.
If the market in your town is the same way, I say go for it!! Buy the home.
Web Reference: http://www.kyleeroe.com
0 votes Thank Flag Link Tue Apr 16, 2013
You are in Williamsburg, VA, if the market is anything like Sacramento pay the difference and close the deal. Nothing wrong with asking the seller to reduce the price to the appraisal price. If a short sale or REO may not happen or take too long.... Perhaps by the time you get the agreement to reduce the price the price may have gone up to what you offered.
0 votes Thank Flag Link Tue Apr 16, 2013
Hi - You have some options 1) try to negotiate a reduction in price with the seller; 2) back out of the purchase contract if you still have an active loan/appraisal contingency, or 3) accept the appraisal and buy the house knowing that the lender will use the appraisal as the basis for the loan.
0 votes Thank Flag Link Tue Apr 16, 2013
Didn't I just answer this question a minute ago?

Pay the difference or have the Seller come down to the appraisal price. A lender is not going to loan you more than the home is worth.
0 votes Thank Flag Link Tue Apr 16, 2013
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