Appraisal came in low

[Turin39789]

Two weeks to be out of our rental house and the appraisal comes in low. Seller has been an asshat and I'm sure we're not going to come to an agreement.

Homeless beer for me tonight.

 

[meltdown75]

:beer: i feel your pain brah

 

[Turin39789]

HULK SMASHKJLASKASKJDLAFDSKJDALKSJ

Seller has already moved to Denver, but I know he's not going to go with this drop in price. He'd still have to fix some stuff before it was ready to go and it comes in to be about 6k more than he paid for it 2 years ago.

His damn fault for moving after two years, but given that he has thrown hissy fits and had to be calmed down by his realtor over small stuff already, I'm going to be opening my non-celebratory bourbon on whatever couch I end up on.

 

[BoomerD]

It used to be, mortgage companies used "friendly appraisers" who always appraised homes at or above the desired loan amount to ensure the loan would go through.

Nowadays, with the housing bubble having popped, they're much more conservative and are using appraisers who use a more conservative set of ratings to give them the numbers.

Add that to the downturn in housing prices, and you have LOTS of homes coming in with appraisals under the asking prices.

That leaves the buyer with the option of a much higher down payment to get the loan amount down to the appraised value...or finding a different house...too often, sellers owe too much on their houses to be able to drop the price enough to meet the appraised value.

 

[hanoverphist]

Originally posted by: Turin39789
HULK SMASHKJLASKASKJDLAFDSKJDALKSJ

Seller has already moved to Denver, but I know he's not going to go with this drop in price. He'd still have to fix some stuff before it was ready to go and it comes in to be about 6k more than he paid for it 2 years ago.

His damn fault for moving after two years, but given that he has thrown hissy fits and had to be calmed down by his realtor over small stuff already, I'm going to be opening my non-celebratory bourbon on whatever couch I end up on.

id have walked away right after that.

 

[Crusty]

Originally posted by: BoomerD
It used to be, mortgage companies used "friendly appraisers" who always appraised homes at or above the desired loan amount to ensure the loan would go through.

Nowadays, with the housing bubble having popped, they're much more conservative and are using appraisers who use a more conservative set of ratings to give them the numbers.

Add that to the downturn in housing prices, and you have LOTS of homes coming in with appraisals under the asking prices.

That leaves the buyer with the option of a much higher down payment to get the loan amount down to the appraised value...or finding a different house...too often, sellers owe too much on their houses to be able to drop the price enough to meet the appraised value.

It's not the lenders choice really, all appraisals have to be done 'blindly'. The lender/buyer doesn't know the appraiser and the appraiser doesn't know the lender/buyer.

It sure was nice when the appraiser worked directly with the lender to get you the numbers you need, but I can understand why that setup has problems.

 

[Turin39789]

Oh, and stocks finally took a step off their bloated mini run today and dipped, MBS market is back up to status quo and rates are dropping. Great day to lock the rate.

 

[Aimster]

If you like the house and the market in your area is stable , you should pay the difference. In my situation the seller is not budging and I knew that.

My sales price is $299,000. The last appraisal came in at $278,000. The guy offered $333,000 VA loan and he didn't have the cash to make up for it.
When it came back on the market I jumped at it.

I'm waiting for my banks own appraisal but I already put in the contract I would pay the difference up to $278,000 appraisal. I hope I am lucky and it appraises for $299,000.

I like the house.... but it sucks that I might be losing $19k off the bat. I'm positive I'll make it back within a few years.
Guess it all depends on how much you love the house, and if the property values are stable (not declining).

oh and if it appraises for less than $278,000 and the buyer doesn't budge .. the f with that sh!t.

 

[vi edit]

If you like the house and the market in your area is stable , you should pay the difference. In my situation the seller is not budging and I knew that.

I wouldn't. By "paying the difference" of $20,000 you are leaving yourself already $40,000 less in equity. Less the realtor fees should you have to sell for another $17,000 and you are just short of $60,000 in the hole before you even step foot in the door. You have any idea how many years on a 30 year loan that will take to make up?

 

[Aimster]

That's assuming that foreclosures continue to happen in 1-5 years. The appraisals are all coming in very low because the only thing to compare them to are foreclosures. When the foreclosures stop home prices will not be so low. They'll shoot up and you'll make up the equity. You won't make money but you'll break even.

Every day I see homes bouncing back on the market because they didn't appraise. People are willing to spend big money for the houses.

Wait for the foreclosures to stop.

 

[Turin39789]

Originally posted by: Aimster
That's assuming that foreclosures continue to happen in 1-5 years. The appraisals are all coming in very low because the only thing to compare them to are foreclosures. When the foreclosures stop home prices will not be so low. They'll shoot up and you'll make up the equity. You won't make money but you'll break even.

Every day I see homes bouncing back on the market because they didn't appraise. People are willing to spend big money for the houses.

Wait for the foreclosures to stop.

July set new foreclosure record.

 

[Aimster]

Originally posted by: Turin39789

Originally posted by: Aimster
That's assuming that foreclosures continue to happen in 1-5 years. The appraisals are all coming in very low because the only thing to compare them to are foreclosures. When the foreclosures stop home prices will not be so low. They'll shoot up and you'll make up the equity. You won't make money but you'll break even.

Every day I see homes bouncing back on the market because they didn't appraise. People are willing to spend big money for the houses.

Wait for the foreclosures to stop.

July set new foreclosure record.

You think this will continue to go on for the several years?

 

[OverVolt]

Originally posted by: Aimster

Originally posted by: Turin39789

Originally posted by: Aimster
That's assuming that foreclosures continue to happen in 1-5 years. The appraisals are all coming in very low because the only thing to compare them to are foreclosures. When the foreclosures stop home prices will not be so low. They'll shoot up and you'll make up the equity. You won't make money but you'll break even.

Every day I see homes bouncing back on the market because they didn't appraise. People are willing to spend big money for the houses.

Wait for the foreclosures to stop.

July set new foreclosure record.

You think this will continue to go on for the several years?

Took Japan in a similar situation 10 years.

 

[Turin39789]

Originally posted by: Aimster

Originally posted by: Turin39789

Originally posted by: Aimster
That's assuming that foreclosures continue to happen in 1-5 years. The appraisals are all coming in very low because the only thing to compare them to are foreclosures. When the foreclosures stop home prices will not be so low. They'll shoot up and you'll make up the equity. You won't make money but you'll break even.

Every day I see homes bouncing back on the market because they didn't appraise. People are willing to spend big money for the houses.

Wait for the foreclosures to stop.

July set new foreclosure record.

You think this will continue to go on for the several years?

Many are not on the market yet.

But my market is pretty stable anyway, so they aren't having a huge effect, prices are just stagnant. The appraisal is 2.42% more than he paid two years ago. Slow growth.