appraisal given 30 min before closing.It was showing $5000 less than the selling price.same buider, 2 homes closed with$ 20000 less.doubt the appraisa

Asked by Put, 32256 Wed May 19, 2010

We are trying to buy a home.We got the appraisal 30 minutes before closing.It was showing $5000 less than the selling price. We now doubt the appraisal and there were some mistakes in appraisal report like extra bathroom

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Donald Price’s answer
Donald Price, , Orange Park, FL
Mon Mar 7, 2011
Put, I am a REMAX Realtor and a State Certified Residential Real Estate Appraiser and this does not sound right. I dont know of any lender that schedules a closing without the appraisal. I bet you are buying from a builder and did not have a Realtor with you when you went to contract with builder. Comps in the appraisal have to be within 90 days of the appraisal with 1 comp within 6 months. They also want 2 pending sales or active listings in the from the subdivision. Call me and I will try to help you out 904-962-8089.
0 votes
Kmbrennan, , Florida
Wed May 19, 2010
Put,
I am not sure what your question is...
Congress enacted a law on Jan 1st called the Home Valuation Code of Conduct. It was meant to protect the buyer by eliminating any contact between the lender and appraiser but instead has only added a middleman who gets paid and assigns the appraisal to the lowest bidder. Often the lowest bidder is not the best or the brightest.
Everyone in the industry is frustrated with the low quality of appraisals and inconsistant values demonstrated these days due to the HVCC. I have had two identical condos in the same project have appraised values with a 20% difference in the same month - obviously one of the appraisers did not do a quality job.

Write your congressman and tell them that HVCC does not help the consumer
2 votes
The Medford…, Agent, Fremont, CA
Thu May 20, 2010
Put:

There are a lot of unknowns here still:

(1) Did you have an appraisal contingency in your contract?
(2) If yes, has it been removed? If yes? Why? By whom?
(3) Will the bank still lend if the appraisal came in below contract value?
(4) Is the seller willing to renegotiate price and terms?
(5) How much is your deposit?
(6) If you walk away and potentially lose your deposit, will the amount you lose be more or LESS than the amount you would lose in depreciation if you went ahead with the sale?
(7) Did you have a local REALTOR® represent you? If yes, what are they saying to you? If no, why not?
(8) Have you talked to a local real estate attorney? That will more than likely be your best option at this point – an investment of a few hundred dollars may save you thousands.
.
0 votes
Put, Home Buyer, 32256
Thu May 20, 2010
We actually did another appraisal and the price came $30,000 dollars less, We made the deposit to the builder and does not know if we can back out now.
0 votes
Put, Home Buyer, 32256
Thu May 20, 2010
We were asking the builder/lender for appraisal 2 weeks prior to the scheduled closing.We checked the recent sales in the same community which were $ 20000 dollars less than the sellers actual price. We were expecting the same decrease in the appraisal for our home. Initially we were scheduled to close on 6th but they postponed it untill they closed a home with their sale price (appraisal came same as the seling price for that home.). Now they are quoting that home in our appraisal and are reducing only $5000 for our home. We postponed closing as the number of bathrooms in the appraisal were wrong and they say it is typo.
0 votes
The Medford…, Agent, Fremont, CA
Thu May 20, 2010
Put:

There are too many unknowns here to effectively answer your questions:

(1) Are you buying from a builder? Did you get a REALTOR® to represent you? Did you check the county tax records for previous sales prices?
(2) I’m assuming you delayed the closing to sort things out?
(3) If the appraisal came in so close to closing, was the closing deadline real? Normally a lender will not lend without the appraisal and it takes time for loan docs to get to title then more time for the loan to fund. What did your lender say?
(4) Are you proceeding with the sale?
(5) Are you negotiating a lower price?

We see mistakes in appraisals all the time – HVCC has not done the industry any favors. Youc an always challenge the appraisal or order another one.
.
0 votes
Dp2, , Virginia
Thu May 20, 2010
Besides countering with a lower price, you could also counter with terms: ask that builder to seller finance the property (if they're unwilling to lower their price).
0 votes
Matt Carroll, Agent, Neptune Beach, FL
Thu May 20, 2010
Put,
As Kim said, your question is not completely clear, but as the buyer, if the appraisal came in lower then your contract price, I would suggest negotiating a new offer with the seller.
0 votes
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