Appraisal Came in Low

[playa1125]

Don't let your emotions get in the way of common sense

[aerosarcasm]

Appraisers adjust for age of sale based on overall local market trends, if their data suggests that the market has been flat for 18 months, using a sale that old is acceptable wihout adjustment. Ideally you want to find comps that are less than 6 months old. The current state of the market nationally is a +10% over the last year, however, this can be very different locally. Also, FHA appraisals are different than conventional. One primary difference is that the appraiser can line item repairs that need to be completed prior to sale to meet a value. In conventional you assume as-is and go with the lower value. Caveat....it has been a few years since I was an appraiser, so some things might have changed....so grain of salt here.

[tooleman694]

Appraisals are still catching up to the market. I have heard of this happening to a ton of people.

[Sup3Rmari0]

That happened to me too back in March. I had to walk away as it was a 10k difference in price. I'm still searching for a home. Ironically a lot of others----It was a townhouse community--- came on the market in the same area, so I didn't have to wait long...but they were ALL 30k over the appraisal price...so I didn't even bother.  It's very frustrating....but it's for our own good. 

[426MW]

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@tooleman694 wrote:

Appraisals are still catching up to the market. I have heard of this happening to a ton of people.

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This happened to me too, last month.  Came in 12.5k below appraisal.  Odd isn't it?  Hopefully this wasn't a VA loan like mine or I would begin to wonder what's going on (conspiracy theory alert!).  My sellers pulled back all the consessions and came down to the appraisal price.  It was a PITA but worth it everytime I drive up my driveway!

[fabadvice]

We walked away from a home for a $4000 price increase with no explanation of why the significant price raise after the new home had been on the market for almost two years. It seemed liked as soon as are agent contacted the builder's they raised the price. We still offered the original full asking price. They came back at the new full listing price. We knew if they could not justify the new asking price we would be in trouble when it came to appraisal time because there is no way we would pay more then the home is worth. After,  we didn't counter the agent representing the builder said she was shocked we didn't counter. Now she had an explanation of why the home price increased. She says it's because of the newly built homes in back of the home we were considering buying, she claims it made the value of the house go up. I don't know how true that is but, I was not willing to find out. We moved on to our second choice which was just recently built. The builder accepted our offer which was full asking price, closing cost, and appliances package. This house also came with no fence like the other house but, we were willing to pay for the fence installation out of packet as long as the builder contributed something. We got a great deal by walking away. I wish you the best with whatever decision you make.

[drkaje]

I really wouldn't want to be upside down in a home from day one.

Hopefully OP can work it out but $12K is a lot. Seller could be upside down or need any difference to fund another home purchase.

[nissana]

Update! Whew  I closed on June 7th.  Sellers came down to $123K, My Florida Bond covered the 3k that I was short of.  I end up getting a $250 check at closing.  Not too bad, considering my credit a year ago.  I am soooooo happy.  Thanks for all the suggestions.  It's a 4/2/2cargar 1750sq.14 years old.  Credit score used 644.

[DallasLoanGuy]

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@stevieswife2011 wrote:

I am still waiting on a the appraisal report it was completed last wednesday 5/15 and we still do not have the report.  My realtor said that if there was a problem we would know by now the realtor made a ridiculous statement. you wont know until the report is given to the lender. but i am still so nervous it will come back less than what we are offering.  But i also think that if it does come back lower the sellers will need to make up the difference i just would not want to by a house that is soo far under appraisal

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