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Mill188
LIF Adult
Member since 3/09 3073 total posts
Name:
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appraisal coming in less than purchase price?
Just heard from my mortgage broker that the bank appraisal came in less than we are paying for the house ($4,000 less). He said he has requested that the bank do a full appraisal instead of just an exterior appraisal (which of course will cost me more $$). He said not to worry, but of course, I am worrying.
Has this happened to anyone? What if the appraiser doesn't find an additional $4,000 in value?
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Posted 9/16/09 6:58 PM  |
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Deeluvsvinny
DONE
Member since 10/08 4952 total posts
Name:
Whatever
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Re: appraisal coming in less than purchase price?
If the appraisal doesn't come in higher then you will have to make up the difference in price, bc the bank won't lend you as much money.
 that your appraisal comes in higher!
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| Posted 9/16/09 8:04 PM |
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KLSbear
LIF Adult
Member since 1/06 1908 total posts
Name:
Karen
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Re: appraisal coming in less than purchase price?
Someone at work recently had the same situation. The bank did a drive by appraisal and came back with a ridiculously low price. He had a full appraisal done, and the appraiser was laughing because the purchase price was a great price compared to what the actual appraisal was going to be. In his case, the full appraisal was much higher than the drive by. If the house has updates inside, especially high end like an up-to-date kitchen, newer bathrooms, etc. I wouldn't worry.
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| Posted 9/16/09 8:39 PM |
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Nik211
my little monkey<3
Member since 5/08 3303 total posts
Name:
Nik
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Re: appraisal coming in less than purchase price?
This happened to us.....we had a full appraisal that came in low....we tried to re-but the appraisal since we had proof that comps sold for more per sq foot and bpo's done by our agent and the bank came in higher but it didn't matter - they wouldn't change the appraisal....
We were purchasing a short sale so we went back to the bank and tried to re-negotiate the purchase price to the appraisal price (which is what I would do if I was you - go to the seller and try to pay the appraisal price) but the bank would not budge on lowering the price....
Instead of putting up $7,600 cash to cover the difference we opted to get PMI instead figuring it's less money out of pocket for us and it only made our payment $45 more per month.....
So even though we put down 20% and went conventional to avoid PMI we still ended up paying it b/c of the low ball appraisal....
Good luck....
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| Posted 9/16/09 8:41 PM |
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HeatherRose
Life is Good :)
Member since 11/07 6605 total posts
Name:
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Re: appraisal coming in less than purchase price?
ask for a full appraisal. No matter what, it will not cost you the 4K more you will have to put down if it doesn't appraise out.
you may have to work with another bank
or you could try and ask the homeowner to lower the price since another buyer may have the same issue as you. (or maybe you can ask they lower it half and you pay the 2K)
If none of that works your choice is to pay the 4K additional or walk away  that would totally stink!! I hope it all works out 
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| Posted 9/17/09 12:27 PM |
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MrsFlatbread
Skinny jeans are in my future
Member since 6/06 10258 total posts
Name:
Baby Momma
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Re: appraisal coming in less than purchase price?
Posted by Deeluvsvinny
If the appraisal doesn't come in higher then you will have to make up the difference in price, bc the bank won't lend you as much money.
that your appraisal comes in higher!
why would you pay the difference if the banks feel the house is not worth it? tell the sellers to come down in price or you are walking away...they will not want to lose the house over $4000
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| Posted 9/17/09 1:03 PM |
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ave1024
I Took The Wrong Road
Member since 12/07 6153 total posts
Name:
That Led To The Wrong Tendencies
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Re: appraisal coming in less than purchase price?
Posted by MrsFlatbread
Posted by Deeluvsvinny
If the appraisal doesn't come in higher then you will have to make up the difference in price, bc the bank won't lend you as much money.
that your appraisal comes in higher!
why would you pay the difference if the banks feel the house is not worth it? tell the sellers to come down in price or you are walking away...they will not want to lose the house over $4000
Because just because one appraisal company says your house is worth X... another appraisal company may come in and say your house is worth Y.
All it takes is for another buyer to come in with a different lender bank, that uses a different appraisal company, and you will get a different figure.
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| Posted 9/17/09 1:08 PM |
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HeatherRose
Life is Good :)
Member since 11/07 6605 total posts
Name:
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Re: appraisal coming in less than purchase price?
Posted by MrsFlatbread
Posted by Deeluvsvinny
If the appraisal doesn't come in higher then you will have to make up the difference in price, bc the bank won't lend you as much money.
that your appraisal comes in higher!
why would you pay the difference if the banks feel the house is not worth it? tell the sellers to come down in price or you are walking away...they will not want to lose the house over $4000
because that's just 1 bank. Other banks may feel it is worth it, maybe even more.
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| Posted 9/17/09 2:02 PM |
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Beth
The Key to your new home....
Member since 2/06 24849 total posts
Name:
Beth
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Re: appraisal coming in less than purchase price?
Posted by HeatherRose
Posted by MrsFlatbread
Posted by Deeluvsvinny
If the appraisal doesn't come in higher then you will have to make up the difference in price, bc the bank won't lend you as much money.
that your appraisal comes in higher!
why would you pay the difference if the banks feel the house is not worth it? tell the sellers to come down in price or you are walking away...they will not want to lose the house over $4000
because that's just 1 bank. Other banks may feel it is worth it, maybe even more.
or another bank might feel it's worth less
it's a risk the seller would be taking over $4K
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| Posted 9/17/09 2:38 PM |
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ave1024
I Took The Wrong Road
Member since 12/07 6153 total posts
Name:
That Led To The Wrong Tendencies
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Re: appraisal coming in less than purchase price?
Posted by Beth
or another bank might feel it's worth less
it's a risk the seller would be taking over $4K
Over 4k maybe. But if the seller realizes that the buyer *really* wants the house, they know the buyer will probably pay it.
It's all a game.
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| Posted 9/17/09 2:41 PM |
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Beth
The Key to your new home....
Member since 2/06 24849 total posts
Name:
Beth
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Re: appraisal coming in less than purchase price?
Posted by ave1024
Posted by Beth
or another bank might feel it's worth less
it's a risk the seller would be taking over $4K
Over 4k maybe. But if the seller realizes that the buyer *really* wants the house, they know the buyer will probably pay it.
It's all a game.
I agree....over $4K on either side I wouldn't walk away from the deal
if it was $20K or more it would be a different story
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| Posted 9/17/09 3:26 PM |
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annoyedTTCer
LIF Adult
Member since 4/09 3272 total posts
Name:
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Re: appraisal coming in less than purchase price?
A 4k diff isn't bad.
I've heard stories from co-workers of 25k+ differences
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| Posted 9/17/09 3:31 PM |
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MrsFab
this is bliss.......
Member since 10/08 1234 total posts
Name:
Mb
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Re: appraisal coming in less than purchase price?
I agree get another appraisal- if it still comes in below- ask the seller to come down $4k- if they dont agree- maybe offer to split- sellers come down $2k and you guys pay $2k more out of pocket
good luck
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| Posted 9/17/09 3:42 PM |
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LSP2005
Bunny kisses are so cute!
Member since 5/05 19461 total posts
Name:
L
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Re: appraisal coming in less than purchase price?
I would ask the seller to renegotiate the price by the 4k.
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| Posted 9/17/09 3:52 PM |
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Mill188
LIF Adult
Member since 3/09 3073 total posts
Name:
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Re: appraisal coming in less than purchase price?
The plan right now is to do a full interior appraisal (which will cost me an additional $150).
According to my lawyer, apparently this is a game that quite a few appraisers are playing these days in order to make more money.
The $4,000 difference is so slight, that it's obvious that that's what the appraiser is doing.
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| Posted 9/17/09 4:00 PM |
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MrsFab
this is bliss.......
Member since 10/08 1234 total posts
Name:
Mb
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Re: appraisal coming in less than purchase price?
Posted by Mill188
The $4,000 difference is so slight, that it's obvious that that's what the appraiser is doing.
sorry that this is happening to you- can you report this to the state? It doesnt seem right
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| Posted 9/17/09 4:02 PM |
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ave1024
I Took The Wrong Road
Member since 12/07 6153 total posts
Name:
That Led To The Wrong Tendencies
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Re: appraisal coming in less than purchase price?
Posted by Mill188
The plan right now is to do a full interior appraisal (which will cost me an additional $150).
According to my lawyer, apparently this is a game that quite a few appraisers are playing these days in order to make more money.
The $4,000 difference is so slight, that it's obvious that that's what the appraiser is doing.
That's ridiculous. I sure hope they don't try to pull that stunt when it's time to get my house appraised.
A complaint to the department of consumer affairs would be in order.
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| Posted 9/17/09 4:30 PM |
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Mill188
LIF Adult
Member since 3/09 3073 total posts
Name:
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Re: appraisal coming in less than purchase price?
Posted by ave1024
Posted by Mill188
The plan right now is to do a full interior appraisal (which will cost me an additional $150).
According to my lawyer, apparently this is a game that quite a few appraisers are playing these days in order to make more money.
The $4,000 difference is so slight, that it's obvious that that's what the appraiser is doing.
That's ridiculous. I sure hope they don't try to pull that stunt when it's time to get my house appraised.
A complaint to the department of consumer affairs would be in order.
I was advised to make a complaint AFTER the deal closes though.  It's just so frustrating. I feel like they were trying to pull a fast one. Because it was only a "drive-by" appraisal - they don't even go into the backyard. The house is on a half-acre lot with a beautiful 30x60 paver patio and japanese gardens. Ummmm - I think that alone is worth $4,000. Instead I now have to pay an additional $150 for the appraiser to do the job they he/she should have done in the beginng.
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| Posted 9/17/09 4:51 PM |
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MaZz
* Lovin my baby girl!!! *
Member since 2/09 6243 total posts
Name:
Gina
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Re: appraisal coming in less than purchase price?
This drive by crap is redic! What happens if everything inside the house has been updated and they dont even get a chance to see that... ugh
My appraisal should be next week... I'm not sure what method they are going to use, but this has gotten me a little worried...
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| Posted 9/17/09 4:57 PM |
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-Lisa-
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Member since 5/05 6530 total posts
Name:
Lisa
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Re: appraisal coming in less than purchase price?
**disclaimer: this is from an appraiser's perspective**
You can't blame the appraiser for doing a drive-by: thats the product the lender ordered. Its the LENDERS decision to do a driveby or full interior inspection.
How much did the lender charge you for the appraisal? If they charged a full appraisal fee, and only ordered a driveby - they're the one's making extra money off you, not the appraiser.
When a driveby is ordered, we are not permitted to go on the subject property - so again, you can't blame the appraiser for not going in the back yard.
If you know of recent sales that support your purchase price, submit them to the bank and ask for a reconsideration of value from the appraiser. That won't cost you anything. $4K is a small amount - the appraiser should be able to close that gap unless you're at the top of the market and/or you're paying too much and they've already maxed out the comps.
eta: if you want me to look into comps for you to support your reconsideration request, I'd be happy to help. (assuming you're on LI - I don't have data elsewhere)
Message edited 9/17/2009 5:54:40 PM.
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| Posted 9/17/09 5:51 PM |
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Mill188
LIF Adult
Member since 3/09 3073 total posts
Name:
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Re: appraisal coming in less than purchase price?
Posted by -Lisa-
**disclaimer: this is from an appraiser's perspective**
You can't blame the appraiser for doing a drive-by: thats the product the lender ordered. Its the LENDERS decision to do a driveby or full interior inspection.
How much did the lender charge you for the appraisal? If they charged a full appraisal fee, and only ordered a driveby - they're the one's making extra money off you, not the appraiser.
When a driveby is ordered, we are not permitted to go on the subject property - so again, you can't blame the appraiser for not going in the back yard.
If you know of recent sales that support your purchase price, submit them to the bank and ask for a reconsideration of value from the appraiser. That won't cost you anything. $4K is a small amount - the appraiser should be able to close that gap unless you're at the top of the market and/or you're paying too much and they've already maxed out the comps.
eta: if you want me to look into comps for you to support your reconsideration request, I'd be happy to help. (assuming you're on LI - I don't have data elsewhere)
Thanks for the offer to look at the comps.  I ran the comps before we made the offer. I've been in the real estate valuation business myself for 20 years and the sales that were shown to me as comps were not arms length transactions. However, rather than fight with the lender at this point, we have decided to get the full appraisal done.
According to the mortgage broker, the bank ordered a full appraisal. When this particular appraiser submitted his/her report, it came back as a "drive by." I am fighting paying the extra money but don't want to further delay my closing so have been advised to deal with it after closing.
This is the only issue that is preventing us from closing at this point. Other than this issue, we're ready to go, so it's incredibly frustrating.
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| Posted 9/17/09 6:41 PM |
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-Lisa-
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Member since 5/05 6530 total posts
Name:
Lisa
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Re: appraisal coming in less than purchase price?
Posted by Mill188
According to the mortgage broker, the bank ordered a full appraisal. When this particular appraiser submitted his/her report, it came back as a "drive by." I am fighting paying the extra money but don't want to further delay my closing so have been advised to deal with it after closing.
That sounds like BS on the part of the mortgage broker/bank. Why would a lender accept a driveby if they requested/paid for a full appraisal? The appraiser is required to deliver what was ordered - we don't get to decide what to deliver.
What bank is this through? All the automated appraisal delivery systems in place these days with the major banks can't even accept a different form than what was ordered.
Somethings not right in this scenario. I hope it works out for you, and I hope you get a different appraiser next time - good luck!
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| Posted 9/17/09 8:46 PM |
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ChrisDee
My Girls
Member since 11/06 9543 total posts
Name:
Christine
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Re: appraisal coming in less than purchase price?
Our sellers had to come down $3800.00
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| Posted 9/17/09 9:56 PM |
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