Foreclosure in Mesa>Question Details

Mary, Home Seller in Arizona

I am facing foreclosure but have found a buyer for my house. He has offered what several realtors in the area

Asked by Mary, Arizona Thu Jan 22, 2009

believe is fair market value (179,000) but the lender says 220K is fair market value. If similar home have sole for 180K and others are currently listed for the same, how can the bank say 220 is the market valu when the data does not support that???

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Hi Mary,

First of all you are not alone. As we know there are several people across the country making the same difficult decision as you are.
I am going to suggest you to get a Realtor and have your house listed as a short sale. By doing that your agent will have to submit to your lender a number of paperwork to substantiate the the current market price in your area. That is an option i have done with clients of mine that were facing the possibility of a foreclosure. It is not the best but it is better than letting it go into foreclosure. Short sale stands for short pay where the lender agrees to sell for less of what is owed and the borrower ( the seller ) can not make a single cent in profit.
Hope this helps you and good luck.
Leonardo
Web Reference: http://www.leonardoteam.com
1 vote Thank Flag Link Thu Jan 22, 2009
Mary,

A big part of that issue has to do with the fact that banks, generally, do not pay for appraissals. They just get a BPO, which is like a very basic version of an appraissal. Many times the bank request only an external BPO, where the person doing the BPO do not even see the inside of the house. Someone recently entered a posting here about a person with very little experience (and no license) doing BPOs unsupervised. And, yes a big reason for this is because the banks are cheap!

Ask your agent to send active and recently sold comparables to the bank. If that does not work you might want to consider paying for an appraisal and sending it to the bank - if it supports your numbers, or to the buyer if it supports the bank's numbers.

Good luck!
1 vote Thank Flag Link Thu Jan 22, 2009
SUGGESTION: Why dont all parties agree purchase for appraised value of home. When there is a dispute always best way resolve any issue.
Web Reference: http://www.lynn911.com
1 vote Thank Flag Link Thu Jan 22, 2009
Jay and Leonardo are spot on! Had a short sale listing - sold it three times at three different prices, declining each time. All three buyer walked because the bank took soooo much time to respond. Foreclosed on home for 30K less than the latest offer! Banks are back logged and cumbersome!
Web Reference: http://www.gaypotter.com
0 votes Thank Flag Link Tue Jan 27, 2009
the site below may be of help....it has info on both shortsales and foreclosures....
0 votes Thank Flag Link Mon Jan 26, 2009
Cindi Hagley, Real Estate Pro in San Ramon, CA
MVP'08
Contact
fair market, smair market

what you did not mention, is how much you owe on your mortgage,

if you owe 220K to the bank, then your the fool for buying a 179k house for 220K! Sorry, thats the fact

If your facing foreclosure, YOU TAKE WHAT EVER IS OWED ON THE MORTGAGE, KISS THE BUYER FOR GETTING YOU OUT OF HOCK!

If you owe more to the bank than the house is worth, I blame the fools at the bank for loaning the money and for you for taking the money for the obvious.

Ask the bank for a short sale packet if you owe more than the house is worth or get ready for foreclosure and the financial nightmare that brings
0 votes Thank Flag Link Sat Jan 24, 2009
Mary, Thats the key if lender send the appraisal is going to be hard to get it approval then you have to be more agresive show them what is a realistic price send you own bpo hired a realtor send pictures explain how many foreclosures and how many , REOS. empty house in the area if they ready said no your offer send another one so they can open your file again . If you have any question I be happy to help I' am a loss mitigation specialist and I am here to help.
0 votes Thank Flag Link Sat Jan 24, 2009
Mary,

We agree that an appraisal should shed some light on a realistic price and benefit all parties, buyer, seller, and bank.
0 votes Thank Flag Link Sat Jan 24, 2009
HI YOU NEED TO FIND A REALTOR WITH EXPERIENCE DOING SHORT SALES . WHO IS THE LENDER ?? SUBMIT NEW COMPS , LET THEM KNOW THAT THAT PRICE IS NOT REALISTIC REQUEST A SECOND BPO. GOOD LUCK.
0 votes Thank Flag Link Sat Jan 24, 2009
Your situation depends a lot on the definition of "fair market value". Unfortunately, many realtors/agents use the term "fair market value" or "market value" as a sales pitch to win over buyers/sellers, when in reality they are referring to "sale price" or "purchase price". The bank is using a definition of "fair market value" as defined by the Appraisal Institute and Uniform Standards of Professional Appraisal Practice which is widely used by all banks, lenders, GSEs, FHA/VA, state and federal regulations for valuations of federally funded real estate transactions or related transactions.

While a lot of banks do use BPOs and/or CMAs for a suggested sales or list price, prepared by sales people to obtain the listing, they also obtain full appraisals from licensed/certified appraisers on properties to determine the "market value" or "fair market value". A majority of my business has been and is doing appraisals on preforeclosure, short sale, and foreclosed properties requested on behalf of banks.

It is also quite common for banks not to accept less than 80 - 85% of the appraised market value. The appraisal (by an independant third party) takes into account and consideration far more data and information then what a sales person is willing, capable, or licensed to do, thereby providing a more accurate and justifiable value conclusion. Sales people pretty much only provide data that supports their price,
0 votes Thank Flag Link Fri Jan 23, 2009
Mary,

You need to have a Real Estate attorney write a letter to the bank for you to bring them to their senses.

I have an attorney I work with who can help you on the web site I have (listed below).

I have no financial benefit from doing this, it's simply a way to help you.


Stew Keene
Ph (480) 220-7491
Fax (866) 711-8573
StewKeene@yahoo.com
Keller Williams - Scottsdale, AZ
2008-2009 Master of Real Estate award recipient
0 votes Thank Flag Link Thu Jan 22, 2009
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