anyone put a contract on a house and the bank appraisal come back too low?

[Anonymous]

just curious - am kind of terrified of paying too much for a house and just want to know how good the appraisals are these days.

[Anonymous]

It happened to me. The appriasal was probably right, but it came back about 6-8 thousand too low. We just paid the difference in cash because it was the only place my then fiance (now ex husband) could agree on and we wanted to get it before we were married so we didn't have to sign a year lease. 3 people wanted the same townhouse.

[Anonymous]

I would not rely on the appraisal to tell you if you are paying too much for the house. Appraisals are all over the map, especially if there have not been many recent sales of similar house with the same pros/cons as the one you are looking to buy. The appraisal will affect your loan to value ratio which is important but don't use it to figure out whether it is too high or too low.

You should look at the trending data for comps over the past few years, consider how long you will be in the house, your tolerance for loss/gain, and whether the house at that price has value to you.

[Anonymous]

We did. The appraisal on our T came back 15K low. We managed to get the seller to come down 7K and we paid the difference. It sucked.

[Anonymous]

If the appraisal comes in low and the sellers don't have any other offers tell them you won't pay more than the appraisal and let them make up the difference.

[Anonymous]

did you put in an appraisal contingency?

[Anonymous]

OP here - yes

[Anonymous]

Good for you OP. You are in the drivers seat.

[Anonymous]

My neighbor across the street put his Capitol Hill row-house on the market last year. The appraisal came in about 30k below the asking price. The buyer's agent called him up, telling him, in essence, "Too bad, you lose! You'll have to take the discount."

After my neighbor stopped laughing, he asked if the buyer wanted to get a different appraiser, or just have him sell it to the next buyer in line. The scrubbed the first appraisal (calling it a refi), and the second appraisal came in over the purchase price. As PP said, depending on where the house is, appraisals are coming in all over the map.

Some of these appraisers haven't a clue how to appraise the neighborhoods they're working.

[Anonymous]

Anonymous wrote:Good for you OP. You are in the drivers seat.

Depends where you're looking to buy. Are there three other buyers lined up behind you? Do you want the place?

[Anonymous]

Anonymous wrote:My neighbor across the street put his Capitol Hill row-house on the market last year. The appraisal came in about 30k below the asking price. The buyer's agent called him up, telling him, in essence, "Too bad, you lose! You'll have to take the discount."

After my neighbor stopped laughing, he asked if the buyer wanted to get a different appraiser, or just have him sell it to the next buyer in line. The scrubbed the first appraisal (calling it a refi), and the second appraisal came in over the purchase price. As PP said, depending on where the house is, appraisals are coming in all over the map.

Some of these appraisers haven't a clue how to appraise the neighborhoods they're working.

Agree with this. Some of these banks are dragging in appraisers from far flung areas who have no clue about the market here. My bank tried to use some guy from fucking Winchester for my refi in a close-in suburb. His appraisal came in 20K below what *the same fucking house models in my hood had sold for in the past month*.

Appraisals were b.s. during the boom, and now they are b.s. in the opposite direction.

[Anonymous]

Not necessarily. We were considering selling our house and moving or doing a refi. We had both processes going on in parallel. Both the appraiser and the real estate agent work in the area all the time. The appraisal came back at 110% of what the real estate agent was willing to list the house for.

[Anonymous]

Yes, happened to us last summer. I forget how low it was now but basically our realtor predicted a low appraisal and it happened. We bought anyway, because we knew what the value of the home was to us (suited us perfectly, we felt the appraisal was low and didn't take into account the best comps b/c low turnover in the neighborhood, etc). we also ran into the situation where our bank brought in an appraiser from somewhere in Maryland. He had no idea how to judge homes in the district and had never been to our neighborhood before, considering how hopelessly lost he apparently was trying to find it, despite GPS and googlemaps and all of the other tools they have these days. We had low-balled the seller already and then got him to come down further meeting us in the somewhere between the contract price and the appraisal price. We paid 8K, he came down 12K. The appraisal was 20K under. We actually appealed the first appraisal and the appraiser came up 3K based on some things our realtor sent him. We did not finance the extra but added it onto our downpayment. Our lender was fine with it as it was a fairly small jump and I think he understood that appraisals really are all over the map these days. We have no regrets and still love the house!

[Anonymous]

yes, we did in '08 and I was 5 months pregnant. The appraisal came back 75K less. In the meantime we sold our house so we were in a bit of a pickle. We walked on the house, fired our real estate agent (who was good friends with the listing agent) and found another very quickly. It's not our dream house and we will most likely begin the process over in a couple years.

[Anonymous]

Your appraiser has got to be very familiar with your neighborhood. I would go so far as to say, for example, that an appraiser who normally appraises houses in Fair Lakes and Springfield in Fairfax has no business appraising houses in Oakton or Vienna. Things really are that location-specific these days.