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Adding A New "Mustang"

Jeff the problem is that you have described the appraisal process prior to Jan of last year. The appraiser doesn't work for the bank, nor are they selected by them. The bank now contacts an appraisal management company (AMC) to contract for an appraisal. The AMC then contracts out to an appraiser. By the law the bank can not have any contact with the appraiser. A seller/realtor CAN contact an appraiser to determine value for listing purposes. Our sellers did utilize a local appraiser for an actual appraisal, not simply a market analysis by the realtor. Both realtors have used the comps from that appraisal to challenge the appraisal done for the loan.

You are spot on about conducting a better job if/when they're local and know the area. The home we're trying to buy is less than 5 miles from our current home. Through the years we've paid close attention to home values. During the past 2 years we've looked at many, many homes in the area and are reasonably familiar with the market. The contract price was right in line. Problem is, the bank for our loan is out of state. While the appraiser is required to be licensed in our state, there is no legal requirement for them to be here. Bottom line, it has become a HUGE problem across the country during the past year or so for home sales due to half assed, uneducated appraisals being conducted and short circuiting contracts. Realtors are screaming about it. The only hope is that an "appraiser" doesn't play hardball on his figure. One thing is they have to provide the criteria they used. If it's flawed it can be challenged and another appraisal conducted by a different person. Of course now the buyer (me!), has to pay for yet another appraisal! Just another example of a business getting paid to do a half assed job with no repercussions, thanks to our legislatures!
 
Well the official appraisal is in. We are, as of right now, dead in the water. Amazingly the "appraiser" increased the initial number by 49k. Now it puzzles me how, if this guy was competent, he could have had a 49k error in the first one?!! Even with the new number unfortunately we're still 51k off of the number we needed.

I read his report and the comps he used. They weren't even close! Most were more than 1000 sqft smaller. Several we had personally looked at during the past year. Again, not even close, nor were the others he used! I am so ticked off right now I could spit! We also found out the selling realtor did not include the original appraisal as we had been told. He provided several comps but stated the sellers refused to provide the appraisal. I spoke with the sellers on Sunday and got no indication that they had done this. Something smells mighty fishy with their realtor....and it ain't the first time! We're not giving up yet, but for the time being it doesn't look like it's gonna happen. The wife and I are heartbroken. We had really looked forward to owning the place!
 
John,

Don't give up hope, many times the seller will reduce the cost to meet the appraisal. It may take them some time to come to terms with it, but if they want to sell they will quickly realize that unless there is a buyer willing to pay above appraisal, they will have to reduce the sales price. I walked away from my dream home for the exact same reason. A couple months later they reached out to me and the deal was done. All is not lost!
 
The home I bought two years ago was priced at 290,000 and appraised at 260,000. I was amazed when they came down to the appraised value. I hope this works out in your favor.
 
Thanks for the words of support guys. There's not a snow ball's chance they're coming down anymore on the price. The loan is a VA loan so we have one last hope during a reconsideration of value request. I spent yesterday coming up with comps that were actually comparable to the house (wow, there's an idea!). Due to the fact the difference is greater than 10% it's supposed to go directly to a VA reviewer who can than compare the yahoo's "appraisal" and the information we provide, as well as exam all of his errors. They have the direct authority to override the appraisal and issue a new value. Once that's done we either will make the amount needed or it's officially a dead deal (and for any other veteran for the next 6 months). Keeping our fingers crossed!
 
This thread has been "open" so to speak for awhile. Well, I figured I'd close out the story for good. The deal on our dream house is officially dead. To give a quick synopsis of the whole thing, the appraiser screwed us with the appraisal (the only thing we were waiting on). Due to it going through VA we had the right to request a reappraisal by them. It was supposed to take 2-3 weeks. Our contract was legally valid until Oct 29th of last year. The reappraisal should have been returned within days of that. The house went back on the market (even though it had a contract). We hadn't gotten any reply from the VA when the contract legally expired. On Nov. 18th the house went under contract with a new buyer. We still had some cards to play so we kept our fingers crossed. Finally in Jan. the VA replied, raising the appraisal by $50k. I'd say the POS appraiser was off....just a little. He got paid though so what would he care?!?:mad: Since the house still hadn't closed our realtor contacted the sellers realtor. The contract was contingent on the buyers selling their home and it closed two days before he called. The sale finally closed with the new buyers 2 1/2 weeks ago. Our dream house is officially gone. If I ever run into that POS appraiser it'll be all I can do not to take the fee we had to pay out of his ass....plus interest!

We're still looking and have found several homes that initially looked promising. We even put in an offer on one that sat on a little over 5 acres. The seller initially demanded some really screwy conditions in the contract. We decided to decline going further because of them. A few days later their realtor called and told ours that they were willing to renegotiate the items we had issues with. We decided to try one more time. While we got some very good stipulations and a good price, the some the same screwy assed conditions were written back in. It got us really suspicious of the home and we walked away. Our realtor explained our skepticism about the home but their realtor tried one more time to get us back, insisting there were no problems. We went with our gut instincts and stuck with our decision. Still on the hunt......again!
 
That sucks. Sorry to hear it didn't work out.

Stupid appraisal. I'd have a hard time not hunting him down.
 
Thanks guys. The ordeal cost us almost $1k with nothing physical to show for it. I say "physical" because the education received was priceless!
 
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