offer strategy- Happily Ever After

[XAVIERSMAMA]

I found a house that I love, and would even offer the asking price, but there is no way the house will appraise for that much based on the past 90 day comps.  I want to offer what it will appraise for, but don't want the seller(bank, it's a foreclosure) to think it's a low ball and lock me out.  Any suggestions on what I can do?  Larger houses with more upgrades in the same subdivision have sold for $10-15000 less than the current listing price, and that doesn't take into account possible seller concessions.  Any input would be greatly appreciated.

Thanks,

TU-647 EQ-655 EX-676 all lender pulled 12/11/09

Message Edited by XAVIERSMAMA on 12-23-2009 03:52 PM

Message Edited by XAVIERSMAMA on 01-04-2010 03:31 PM

Message Edited by XAVIERSMAMA on 01-06-2010 11:22 AM

Message Edited by XAVIERSMAMA on 01-11-2010 12:24 PM

Message Edited by XAVIERSMAMA on 02-05-2010 02:55 PM

[XAVIERSMAMA]

So the bank was asking $124900, I offered $119000 with $6500 seller closing cost, they countered with $119000 and $5500 seller closing.  My lender says I need $6500 closing so I countered with $120000 and $6500 seller closing cost.  This all seems pretty silly to me at this point, it all means the same thing moneywise in the end, but I guess it must look different on their balance sheet or something.  The banks agent did tell my agent though that if the appraisal doesn't come in that high, they won't fight it and they will move down, so what exactly is the point of all this?  Please send out your good thoughts and wishes, I love this house.  I'll keep you updated.

[Anonymous]

You could consider offering asking price or close to and put some contingencies in there.  A financing contingency for sure - the bank won't give you a mortgage for more than the house appraises for.  Obviously if the appraisal comes in for some reason higher than your offer, you'd be stuck.  You could probably do an appraisal contingency too, saying it must appraise for X dollars.  If the appraisal comes in lower in either case you can use it to help negotiate.  Again, they can make mistakes either way, too low or too high, so if you don't truly want to pay the sales price, these aren't applicable..  I think some people have submitted offers with letters explaining their low ball offer, that might be another idea to ask your agent about.  If you can provide recent solid comps, they might bite.  What's your agent thinking?

[XAVIERSMAMA]

He sent over the comps with the offer, and the bank's agent and my agent are in agreement that it probably won't appraise for the asking, but I guess the bank has to meet some magic number.  I'll have to wait and see what happens.  I actually don't mind paying the asking price, but I won't be able to afford the difference between what it appraises for versus what the asking price is.  The comps in this neighborhood, literally next door and across the street are 200-500 square feet larger, have the high end finishes in the kitchen, and closed within the last two months at $105000, $108500, and $10900 minus any seller concessions. 

[XAVIERSMAMA]

Bank accepted my offer  On to the inspection and appraisal which ,I've noticed from this board, seems to be the most eventful part of the process.

[ArmyStrong]

Congrats and good luck to you.

[XAVIERSMAMA]

Here's the latest, appraisal came back at $104000, $16000 less than my offer, but almost exactly where I thought the price would be.  Still waiting for the bank(seller) to see what they will do.  Their agent said they wouldn't fight the appraisal so I have to wait and see whether that's true or not.  Keep sending out your good thoughts.  I want this rollercoaster ride to be over and move into my new house already.

[ArmyStrong]

**Good Thoughts!!**

[Charlington]

**Good Thoughts!!**

[XAVIERSMAMA]

So the bank came back and will accept the appraisal price with no concessions.  My lender said to do the loan my rate would change from the 4.5% I had locked to 5.7%!?!?!  Is this a bait and switch.  I still will have to come up with the same amount of $ to close, and the sales price is lower, so why is my rate so high now?  I don't know what to do.