Profile picture for shue01

Appraisal Nightmare

I'm trying to refi my ARM to a fixed through the refi-plus, but the appraisal keeps getting in the way.  A month ago, my home appraised for 270,000 (that loan fell through) and now with a new lender it just appraised for 220, 000.  Zillow ( and several other sites) shows it at 297,000 so why the huge difference?
  • August 14 2009 - Vallejo
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Answers (5)

Profile picture for oldskoolballr
You are in a rapidly declining market.  That is why you are seeing the big difference.  Zillow should only be used as a general idea not a true value.
  • August 14 2009
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An appraisal is only an estimate (opinion of value) Appraising is not an exact science and it is not unusual that two different appraisers would have two opnions of value. Further, each time a new sale happens or an old sale becomes outdated the pool of available comparable sales an appraiser can use changes. If you know the new appraiser missed a good comparable sale or two in his appraisal you can by all means have your loan officer appeal the appraised value. Your loan officer can supply the evidence of the other sales which  should have been included to support the higher, more correct value.
  • August 14 2009
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A couple recent short sales or foreclosure sales may do that. One or two more may lower your value even more. .... Two appraisals a couple  weeks apart may not have even one comp in common.

This is why it may not be so wise to wait for rates to drop further when you may lose a considerable amount of your equity in a heartbeat. All mortgage loans are based on loan to value. .... Good luck, Rudi
  • August 14 2009
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Profile picture for Bentley Advisors
Zillow is a great tool and has really brought power to the people in the form of knowledge (i.e. real estate data).  However, it cannot be relied upon for mortgage transactions.  In addition to what the others have stated, Zillow could be pulling comps from a wider radius or using comps not similar and allocating inappropriate adjustments among many other reasons.  In addition, there's no way that Zillow can know the things that a local appraiser who's familiar w/ an area knows.  Although Zillow is a great tool, it's not perfect and there's only so much a computer algorithm can do.  To add to all that, new regulations re: appraisals seem to have appraisers super-conservative these days so as to cover their behinds.  If you have solid comps to support your value estimate, next time you could have them prepared to give to the appraiser at time of inspection.  Good luck.
  • August 15 2009
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What value do you need to get your refi done? 

Your current lender has an appraisal rebuttal process.  If you believe the $220,000 value is low then this process allows you the opportunity to present relevant information that the appraiser must consider and respond to.  If the information (better comps) that you present are valid then the appraiser must revise his/her report and adjust the appraised value accordingly. 

The rebuttal process can be daunting for a consumer but a mortgage consultant worth their salt should be able to handle it for you.
  • August 18 2009
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