Profile picture for MissBrewha

Can REOs be used in comparing properties appraising a house?

We are in escrow on a home and recently got the appraisal. To our dismay, it was 40k less than our offer. We were told that the appraiser didn't look at comparable homes in our area and also compared the house against recent REOs. Is there anything we can do at this point in order to not lose the house, other than pay the difference?
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
December 16 2009 - Ventura
We think we've answered this question for you!
  • Be a Good Neighbor. Be respectful and on-topic. No spam or self-promotion! See our Good Neighbor Policy.
 
 

Answers (5)

Let me put on my appraiser hat. First of all, are there any very recent closed sales that support the sale price on the home? Are there any pending sales that support the sale price?

Have your broker call the listing agents on the pendings to see if the contract price supports your sale price.

In my market area prices are rising. But there has to be recent market data that supports the rising price supposition. I think most appraisers are aware of rising prices but there has to be data to back it up.

Once sales close at higher price points then the appraiser has something to work with. If there are no very recent sales at higher price points then you may be stuck with a lower appraisal until such time as some pending sales close at the higher price point.

We are currently in a challenging market with the supply-demand equation far out of balance. We have an extremely limited inventory and numerous buyers. This typically results in higher prices. I would imagine that within the next month or so we should have a sufficient number of closed sales at higher prices to use as comps. Until that time you may need to come in with more cash down or convince the seller to reduce the price. 
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
April 19 2013
You can also ask your Realtor to provide you with recent comps, if the purchase price if $40K over the purchase price, you can re negotiate the price, or pay the 40K premium or have your realtor/broker review the contract for other remedies i.e. cancellation.

Best of success.
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
December 05 2012
So long as a home has sold within the last 90 days, it can be a comp.  You can request that the bank use a second appraiser to verify the initial appraisal.  Appraisals can vary up to 30% depending on the appraiser.  
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
September 24 2012
yes reo's can be used in apprasials.

if your apprasial came in less than the what you offered ask the seller to concess to the apprasial amount. if your still in your contingency period you can walk from the contract if your not a fha loan and you still want the house and the seller doesn't want to concess then you choose.

but if your tring to purchase with an fha loan then they wont lend on it for more than the appraised amount

ask the seller to concess

best of luck
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
December 17 2009
Profile picture for Eric142
Yes REOs can, and sometimes should, be used in an appraisal.  Especially in places were REOs make up a significant portion of the market (like California).

As for your options, you probably have all the ammunition you need to negotiate down the price.  Why on earth would you want to overpay for a house by $40,000?
  Flag content
Close
Report a Problem

Please enter a valid email address.

Close
Content flagged

We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

Close
We're Sorry
This service is temporarily unavailable. Please come back later and try again.
December 16 2009
 
Related Questions
Title confusion
Profile picture for Vince Curtis
Latest answer by Vince Curtis
August 09 | 5 answers
do you know how to find legitimate rent to own properties?
Profile picture for sunnyview
Latest answer by sunnyview
March 06 | 9 answers
Can REOs be used in comparing properties appraising a house?
Profile picture for Tom Molinari
Latest answer by Tom Molinari
April 19 2013 | 5 answers
Does the Realtor charge a commission to the buyer?
Profile picture for Richard Morrison
Latest answer by Richard Morrison
March 27 2013 | 25 answers
My daughter purchased a home in April 2012. The listing clearly stated the house had air conditionin
Profile picture for Mack McCoy
Latest answer by Mack McCoy
September 26 2012 | 11 answers
Mortgage Rates
 
Be A Good Neighbor

Zillow Advice depends on each member to keep it a safe, fun, and positive place. If you see abuse, flag it. More on our Good Neighbor Policy.

Homes for Sale
  1. 1748 Harper Dr, Ventura, CA Home For Sale
    1748 Harper Dr, Ventura, CA 93004

     For Sale: $655,000

    • Beds: 4
    • Sqft: 2474
    • Baths: 2.0
    • Lot: 7379
  2. 10765 Darling Rd, Ventura, CA Home For Sale
    10765 Darling Rd, Ventura, CA 93004

     For Sale: $850,000

    • Beds: 5
    • Sqft: 3151
    • Baths: 3.0
    • Lot: 8598
  3. 4567 Gateshead, Oxnard, CA Home For Sale
    4567 Gateshead, Oxnard, CA 93035

     For Sale: $759,000

    • Beds: 2
    • Sqft: 1216
    • Baths: 2.0
    • Lot: 2800