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@Anonymous wrote:The issue will be whether the seller can come down that low. That is a 30K price drop on a 200K house.
They may not have enough equity to sell at that price when you subtract commission and whatever $ they need for a new house or for living/paying off bills. You see selleres usually giving in when it is a couple percentage points of the sales cost, but nto as often when you are talking about 15% of selling cost. At 195 K, they are only clearing around 180K Then they have to have $ to move on. At 226, they owuld have been clearing 210K. Huge difference an could be a game changer.
I agree with you, that is a huge drop and I myself wouldn't simply agree to it. . .I think the other agent has gathered a few other comps to try and convince the current appraiser to up the price a little. They haven't found anything really solid over $210,000. My other insight is that the seller is original owner and does have a bit of equity in the house, so I'm hoping that goes in our favor too?!?! But if he absolutely needs it to purchase another home, it may be a losing battle.
@Anonymous wrote:I'm thinking it has something to do with who appraised it. My reasoning is we are going with a lender out of New York - we're in Pennsylvania. They use their own appraisal company, and I'm wondering if they're just not familiar with the area. That was much lower than I ever expected and I even belive it's pretty low. Like I said earlier, I did comparable studies at the beginning and there wasn't anything sold recently for less than $275 with the same specs. I haven't heard anything yet from either party, but I'm almost positive they'll get another appraisal, which will take more time and more stress. . . I REALLY want this house - but I can't come up with the difference if the appraisal value stands as is and the seller doesn't budge.
KGuare, Lel is correct. It most likely is a result of HVCC. It's killed hundreds, if not thousands of deals, but it's a real money maker for the AMC's which are for the most part owned by the banks. AMC's are charging a small fortune for the appraisals and pocketing all but the small percentage they pay the appraisers. You can ask for a review, but it may come to naught.
You can find info on myfico by doing a search for HVCC or just Google it. Here's one of the links I found by doing so: "HVCC, still stymieing deals, may be sunsetted." If you type that phrase in to a Google search you'll find the same article. Be sure to read the comments at the bottom.
There is a movement to have this monstrosity abolished. We can only hope it happens.......
Good Luck,
D-R
Update - we got the clear to close last night with two conditions that are easily satisfied!!! How they did that without the appraisal? Baffles me, but the seller's agent submitted new comps for the appraiser to review yesterday morning and he has agreed to up his appraisal. How much is the question, but the seller is already aware of everything and seems agreeable to sell at the corrected appraisal even without the final number. So, it looks like we may be going to close on time anyway!?!? What a bizarre chain of events - I would not wish this stress on anyone, but I know the final outcome is well worth it
Hi, I had a similar situation but a good outcome. We were purchasing the home for 167 plus seller concession of up to 5% closing costs. The appraisal came in at 159k. Not good, but what the appraiser did was subtract all seller concessions from the home purchase prices that he did the comparison on. The company that used him thought that was wrong as well and that company paid another appraiser to come out (lender agreed) and that appraisal came in at 169k. Big diff. Worked for us. Glad to see yours had a good outcome as well.
Our home was built in 2004 but not really completed until 2005. The buyer of previous home could not meet qualifications and we were forced to go on an arm due to not enough money to get a standard mortgage.Cost of home $350,000. This includes the $40,000 for the lot. We finally sold the previous house 2 years later( paying homestead and non homestead taxes). We now went after a mortgage as we were on a 3 year arm.
Appraisal came in $150,000 less than we owed as our arm put NO EQUITY on the house.
The appraisal was based on a home in a different neighborhood, 8 years older than our home. I fought the apparaiser and got back the money charged for the appraisal. We are still on an arm using up what funds we received from the sale of the house and will probably end up in forcloser.
The appraisal would have been the golden bullet for you ask to have the asking price lowered. $30k over a 30 year loan is at the end just about $60k you paid back – that’s about 30% of the house value!
It's the end of the year, the tax benefit will end 04/10, economical situation, ect. Best condition to negotiate a lower price. I know the seller has to make a living as well, but ask yourself do you want to pay for his mistakes in the past? It’s your money that you are cashing out, have to pay back in the future and/or could use to retire early.
Negotiate hard, but fair, in particular fair for you and your future.
Good luck!
We had this as well. Turned out the appraiser was comparing our house to houses in other neigbourhoods that were of lesser value than where our house was. After we complained that our apple was being compared to his oranges, he came back to our neigbourhood and reassessed to our neigbourhood. Appraisal went up.
Hope this helps
Kguare,
Have you considered asking your lender for a "Short Sale" if your mortgage balance is greater than the appraised value. That was my only way out of my Long Island house, in NY. Let me know if you need more information on this. We just closed the deal this past Friday. I was owing $526K and the lender accepted $382K including seller's concessions and closing costs.