http://www.trulia.com/voices/Home_Selling/What_happens_if_the_appraisal_done_by_the_buyer_s_-79181Will this give the buyer an out in the contract of sale. Will the seller lose this sale? The contract does not say that the buyer can cancel the sale if the house appraises lower. Am I correct to believe that the seller shouldn't be concerned? Will the buyer be in default if he pulls out because he does not have the funds to buy the house now? The buyer has been given extensions on a Time Being of the Essence twice in order to get a firm commitment. He had a 30 day contingency clause to get a mortgage. We believe he had one but didn't like the terms. He was to send notice to the seller within time frame if he wanted to back out without a penalty. He did not. He no longer has the option of the sale being contingent on his getting a mortgage as he let the contingency expire. Again, is the buyer in default?en-ushttp://www.trulia.com/voices/profile/Real_Estate_Pro-New_York_NY-82052/http://www.trulia.com/voices/profile/Real_Estate_Pro-New_York_NY-82052/For the Realtors who have given false advice here next time please check with a lawyer or don't make any statements at all. ~~~~~~~~~~~~~~~ Which agent gave false advice, Tina? Why didn't you check with a lawyer, by the way? Now that we have finally closed on our home ~~~~~~~~~~~~~~~~~~~~~~ Feel good that your buyer is already under water? @@Fri, 27 Feb 2009 03:39:12 -0800http://www.trulia.com/voices/profile/Other-Cold_Spring_NY-294443/http://www.trulia.com/voices/profile/Other-Cold_Spring_NY-294443/In response to Realtors who have given false advice-- Now that we have finally closed on our home we have been told by our lawyer that even if the buyer received a low appraisal value on the home he would be in default if he canceled the deal.He would be ok only if the mortgage contingency were still in effect. However, he chose to let the contingency expire and still go forward on the transaction. Once a mortgage commitment contingency clause has expired and buyer did not meet the deadline to pull out he is in a binding contract. The only choice he would have is to either default for lack of funds or come up with the difference on his own. For the Realtors who have given false advice here next time please check with a lawyer or don't make any statements at all.Fri, 27 Feb 2009 02:19:18 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-West_Islip_NY-241426/http://www.trulia.com/voices/profile/Real_Estate_Pro-West_Islip_NY-241426/If your attorney doesn't know the answer to that question - you're in trouble. Also - depending on the difference - and our motivation for selling - I would consider just dropping the price to the appraisal number to get the deal done. In this market - you've got a buyer - move on and get the deal done - but alot of this depends on the buyer.Sun, 11 Jan 2009 19:08:23 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-Dallas_TX-123371/http://www.trulia.com/voices/profile/Real_Estate_Pro-Dallas_TX-123371/GREAT QUESTION: however all governed by executed contract IF lender appraisal lower than approved amount NO lender can loan money on a home overvalued. No default on buyer. Title company, great resourse as 3rd party who enforces return of any escrow money must be approved by all parties brokers, buyer, seller.Sun, 11 Jan 2009 15:20:16 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-New_York_NY-42347/http://www.trulia.com/voices/profile/Real_Estate_Pro-New_York_NY-42347/Yes buyer is in default. He/she could come up with difference in cash if the buyer really wants the home. Otherwise buyer can very well loose down payment.Sun, 11 Jan 2009 14:22:00 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-11743-22149/http://www.trulia.com/voices/profile/Real_Estate_Pro-11743-22149/If the house does not appraise to get a mortgage, the mortgage will be denied. almost every contract has a mortgage contingency clause. If buyer is denied because property is selling for more than it is appraised for, the buyer can walk.Sun, 11 Jan 2009 14:15:34 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-Philadelphia_PA-192310/http://www.trulia.com/voices/profile/Real_Estate_Pro-Philadelphia_PA-192310/The loan will be denied by the lender for inadaqute collateral. That means the Buyer is out of the deal unless the Seller comes down to the appraised value or if the buyer is willing to put enough down to make the lender happy. It's that simple!Sun, 11 Jan 2009 13:05:56 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-Glendale_CA-54633/http://www.trulia.com/voices/profile/Real_Estate_Pro-Glendale_CA-54633/Tina What did your Realtor say? It sounds to me as though you don't have one. That is too bad. Buyers not qualifying for financing are a big problem these days, and so are appraisals. Appraisers are under the gun to be accurate. Did your Realtor meet with the appraiser? Did your Realtor warn you that the property might not appraise? A good Rea;tpr will work with an appraiser to help them with information to do everything possible to make the appraisal accurate. Did your Realtor talk with the buyer's lender? Did the Realtor REQUIRE that the buyer co-apply with a lender that the Realtor knows to be competent? In this economy sound business practices should prevent surprises. Based on your questions it sounds to me as though you are selling without professional representation. Good luck. The questions you have are best answered by your Realtor. If you don't have one, I don't think anyone on Trulia has enough knowledge of YOUR situation to help you. This is not legal advice. If you need legal advice, consult an attorney.Sun, 11 Jan 2009 11:49:46 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-Mahopac_NY-60205/http://www.trulia.com/voices/profile/Real_Estate_Pro-Mahopac_NY-60205/Hi Tina if there is no appraisal contingency (which it sounds like) then the buyer has to buy it regardless of the appraisal or lose the down payment. Now should the seller NOT be concerned? Well if they seller only takes their down payment (how much is it?) is that enough to get them buy or do they really need it sold at the sale price? The buyer is not FORCED to buy it but has to or will lose the down payment but often the seller is in a position where the down payment is not enough and their situation makes it such that they need the house sold. You need to ask your attorney but sounds like the buyer may be in default.Sun, 11 Jan 2009 10:25:47 -0800http://www.trulia.com/voices/profile/Real_Estate_Pro-New_York-149523/http://www.trulia.com/voices/profile/Real_Estate_Pro-New_York-149523/A) Buyer must come up with more cash and is probably over paying for the property if they do or B) Seller lowers the price to make the deal work. If the Buyer had a Mortgage Contingency, Yes they have an out. Seller should be VERY concerned I have never heard of an attorney letting a contingency expire without it being met or no longer a concern. Without seeing the actual contract and conditions of an extension (not Time of Essence Letter) we can only speculate. But in the end, what difference does it make. if the buyer can not get a mortgage to buy the property, the seller can not get blood from a stone. Deal will be dead. Which end of the transaction are YOU on?Sun, 11 Jan 2009 10:25:27 -0800