My wholesale lender for residential property says that the appraisal is subject to loan approval is this right ?

Asked by Mukesh Arr, Fremont, CA Sun Aug 14, 2011

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, ,
Wed Nov 23, 2011
You got it reversed: Loan approval is subjective to a subtle appraisal.
0 votes
, ,
Wed Nov 23, 2011
Even if your loan is locked, pricing can change at time of closing if your credit profile or the property value has changed. See my website. I have a page devoted to "risk-based pricing" - "your rate lock" & "loan killers."

Happy funding, Rudi
Web Reference:  http://www.umboc.com
0 votes
Barbara Brod…, Agent, San Mateo, CA
Wed Nov 23, 2011
Final loan approval will always be subject to appraisal and more times than not nowadays it goes through 2 appraisal audits in addition to another VOE (Verification of Employment), another title clearance to make sure there are no liens attached to the property and a second credit check review prior to funding and closing the loan. It is just another way to protect you as a consumer and protecting their investment and interest on your new home purchase. I hope that helps.
0 votes
Ruth and Per…, Agent, Los Gatos, CA
Sun Nov 6, 2011
Hi Mukesh:

Yes in this market, the Appraisals have sometimes Multiple reviews as well the Banks
have multiple reviews.

Your lender is absolutely correct.

Good luck.
Perry
0 votes
Grace Hanamo…, Agent, Cupertino, CA
Mon Aug 15, 2011
Hi Mukesh and thanks for your post.

As Andrea correctly noted ALL appraisals are subject to an appraisal audit which is conducted by a third party contractor and NOT the lender. The lender will require that the appraisal be reviewed a second time prior to loan approval. If the appraisal does not hold up under the audit, then the price can be adjusted. So, yes, the final loan approval is subject to an appraisal review and final approval.

Hope this helps!!

Sincerely,
Grace Morioka
Area Pro Realty-People's Choice
0 votes
The Medford…, Agent, Fremont, CA
Sun Aug 14, 2011
As stated below ... reverse it. Might have been having a bad day ...
0 votes
Andrea Wince…, Agent, Milpitas, CA
Sun Aug 14, 2011
The loan approval is subject to the approval of the appraisal. The home has to be appraised for equal to the amount that you are borrowing on the property. Since the bank is holding the home as collateral for the loan, they need to make sure it's a sound investment. If you loaned a friend $1000 cash, and they gave you a diamond necklace to hold as collateral, you would make sure the necklace was worth $1000. If your friend never pays back the loan, then you can sell the necklace and recoup your loan investment. Basically the same principal with borrowing money on a house.
0 votes
, ,
Sun Aug 14, 2011
the appraisal is always subject to the underwriters review.
0 votes
Elias Anguia…, Agent, Fairfield, CA
Sun Aug 14, 2011
The other way around.. Loan is subject to appraisal value unless if under valued buyer comes up with the difference..
0 votes
Tony McMahon, Agent, WHITE PLAINS, MD
Sun Aug 14, 2011
The loan approval is subject to the appraisal.
0 votes
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