Home Selling in 44266>Question Details

Tracy, Home Seller in 44266

In trying to sell my home, it was appraised almost 27,000 less than sale price, have a buyer, what can I do to get asking price

Asked by Tracy, 44266 Thu Oct 13, 2011

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Appraisal rules have been standardized and as of Sept 1st there was industry wide changes to the process. Unless the appraiser got the bedroom count wrong or called it a tri-level instead of a colonial, unlikely any 2nd appraisal will come in closer to what you are looking for. i recommend to my sellers to pay a fee for appraisal and price the house within 5% of that number from the beginning. Appraisals are the number 1 constraint on keeping a deal together after contract acceptance.
1 vote Thank Flag Link Fri Oct 14, 2011
What has the buyer's response been?

Most likely you won't get asking price from this buyer. They would have to be willing to make up the $27,000 out of their pocket. That's highly unlikely.

You can look for a new buyer, but you might be facing the very same situation.....Best advice?
Reassess your asking price, as it might not be in line with the market.........to "get asking price", you might have to come up with a lower one.

Good luck!
1 vote Thank Flag Link Thu Oct 13, 2011
If your Realtor is watching the market closely, it's possible that another sale near you may close soon with a more comparable, higher selling price to yours. You may have to wait to sell your home until the value increases in your neighborhood or possibly make and note repairs that could bring you closer to other homes. Keep communication open with your buyer and see where they stand. Perhaps they're okay with waiting or both of you can negotiate a new price or be creative with repairs/closing costs, etc. to help make up the difference. Your Realtor will need to be very skilled in reviewing comparables and diligent about getting inside of them and possibly helping assist you with an appeal if necessary. If it turns out that the appraisal is correct, you may be in the same boat as many other sellers right now and will have to eat the difference or sit and wait for the market to pick back up... Good luck to you.
Web Reference: http://www.YouShouldOwn.com
0 votes Thank Flag Link Fri Oct 14, 2011
Tracy, playing devil's advocate, but if the house appraised for 27,000 less sale price what makes you think you can get the sale price from this buyer, let alone another buyer?
0 votes Thank Flag Link Fri Oct 14, 2011
An appraisal isn’t required if you carry back the financing yourself.

I have had sellers appeal an appraisal, but that doesn’t work very often. For one thing most buyers will not stand for it, they may initially agree but then get cold feet, the process is not quick so they have time to mull it over. The last appeal I had from a seller was a train wreck, the seller’s Realtor furnished comps that indicated a value that was lower than the appraisal?????

If you appeal the process go in with proof that the figures are wrong, provide comps that justify the sale price otherwise do not bother making an appeal, it will not work. You can always offer to pay for another appraisal if you feel strongly but do not have proof. Hope this is helpful,
0 votes Thank Flag Link Fri Oct 14, 2011
Everyone has given you good answers. If this was an FHA loan, the appraisal will stand for the next 4 months, before FHA will do another one. What does your realtor think? If the appraisal seems off, you can ask for another appraisal. Good luck!
0 votes Thank Flag Link Fri Oct 14, 2011
Shana's answer is correct but I would add one more option. You can "appeal" the appraisal if you think the appraiser relied on the wrong homes for comps or missed some. You could also advertise to cash buyers only.
0 votes Thank Flag Link Fri Oct 14, 2011
If the buyer is financing then the bank will send their appraiser to the property for evaluation. Generally speaking and in my experiences independent appraisals typically come in at $2k-$5K of each other. I would suggest thinking in terms of can you afford to sell at appraised value? If it happens that you can get the extra $27K let us know---this may be one to go down in to the RE history books. Good luck to you!
0 votes Thank Flag Link Fri Oct 14, 2011
One thing that you could do to get closer to your asking price is to offer to sell your property with creative financing. Nevertheless, expect to walk away with little or no cash from this transaction unless you have considerably more than $27K of equity (at the assessed value) in your property.

Otherwise, you'll need to price your property to the market to sell it soon, or pull the listing and re-list it once it would appraise for $27K more (which might be several years from now).
0 votes Thank Flag Link Fri Oct 14, 2011
If the buyer puts down 20% for a conventional mortgage they will not qualify for the loan unless they can make up the difference in cash. With that said you might consider splitting the difference. Despite the last comment appraised value does not mean market value? Appraisals come in lite all the time. Especially now that appraisers are working for the banks and there is no recourse for them under appraising properties. Only happy banks taking less risk and not challenging the appraisal witha field review. I would convey to the buyer that just because their lender values the home at this price does not mean you do.
0 votes Thank Flag Link Thu Oct 13, 2011
Hi Tracy,

When appraisals come in low (below sale/purchase price), there are 4 options: 1) Lower your price to the appraised value, 2) The seller and buyer meet somewhere in the middle, 3) The buyer pays the difference in cash (as long as it's not a VA loan they are using for financing), 4) You cancel the contract.

Shanna Rogers
SR Realty
http://www.RealtyBySR.com
0 votes Thank Flag Link Thu Oct 13, 2011
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