Good morning Chickd08:
Hopefully, the appraisal will pick up the two REO sales and your appraisal will not support the sales contract value, thereby giving you a very clean exit strategy. In terms of the home inspection clause, unless there is something in the inspection that gives you a similar exit, I lean toward agreeing this cannot be misused as your exit.
Notify your loan officer of these sales immediately if you haven't already. In this market, and with those two sales so recently completed, I daresay they will have an impact on the appraisal price, and you are back where you wish to be.
Best wishes, Jim, American Bank... more