While cross qualifying, can the bank's lender request another appraisal?

Asked by fatsiebelle, Los Angeles, CA Wed Feb 20, 2013

So, my husband and I were preapproved with one lender and we made and got an offer accepted on a property that requires a Fannie Mae Homepath Reno Loan. Our purchase price is $260k. The "subject to" appraisal came back at $260k. I'm not sure why, but the asset manager does not want to lower the purchase price. Rather, they want us to cross qualify with their preferred lender. Which is fine as my husband and I are solid. Its the property it seems. But now this new lender says the original appraisal will not work as the property, should appraise for at least $293k after repairs. And he wants to order a new one with his own Appraiser. Can this new lender do this? Won't it essentially erase the original appraisal from the property?

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Elva Wormley’s answer
Elva Wormley, Mortgage Broker Or Lender, San Jose, CA
Wed Feb 20, 2013

The new lender does not have to accept the appraisal from the previous lender. Yes, if they order a new appraisal, they will disregard the first appraisal.

Best regards,

Elva A. Wormley
Mortgage Consultant
Office (408) 615-8500
C2 Financial Corporation
2845 Moorpark Avenue, Suite 209
San Jose, CA 95128
NMLS #331981
0 votes
Janey Bishop, Agent, Calabasas, CA
Wed Feb 20, 2013
Purchasing a Fnma property doesn't generally "require" that you use HomePath loan but if it helps you get the house with some funds for repair it could well be worth it.
0 votes
James Sanchez, Agent, Burbank, CA
Wed Feb 20, 2013
Wow... 3 appraisals at $400.00 bucks each.... you guys must really like the house. And yes they can order a different appraisal as stated below.

Good Luck,

0 votes
Sona Gallatin, Agent, Santa Clarita, CA
Wed Feb 20, 2013
Yes the new lender can order another appraisal and no it wont erase the original appraisal report. The new lender is trying to see if the value is there once all the work is done. I would recommend that you get a list of comparable sales of similar properties from your agent, a very recent one, not one that includes sales from last year as much has changed since.
Good luck and congrats on your purchase!!
0 votes
Shane Milne, Mortgage Broker Or Lender, South Jordan, UT
Wed Feb 20, 2013
Yes they can do that, and no it won't erase the original appraisal that the first lender did. Each lender will normally use their own ordered appraisal and won't accept an appraisal ordered by another lender (sometimes they will, but most of the time they will not and the previously done appraisal will just be disregarded). With conventional financing, there is no "master database" where appraisal values are logged (unlike with FHA or VA financing, where there is). You could conceivably apply with 3 different lenders, they could get 3 different appraisals, and none of the 3 appraisals would have any impact on the other appraisals that were done.

Shane Milne | Lending in all 50 states | NMLS #81195
shane@thebesthomeloans | 949-273-4161 direct
0 votes
Ron Escobar -…, Agent, Beverly Hills, CA
Wed Feb 20, 2013
If the lender is trying to get a higher appraisal amount, getting a second appraisal may be a good thing. However, just because you order a second appraisal it does not mean the property will appraise higher...

Have your buyer's agent give you a list of comparables in great condition.. that way you can estimate what your property will appraise for after it is renovated.

Good luck and congratulations!

Ron Escobar
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