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Answers (11)
- Jessica Beganski, "Jessica Beganski"
- Contributions:24
Yes, a buyer usually does the home inspection first then the appraisal.
You have two options, other than backing out: renegotiate the price with the seller (in your favor) or have your agent look through the appraisal to make sure the appraisal is accurate.
The appraisal is not always correct-I just had an instance where an appraiser used some inaccurate information and it was compelling enough to make the appraiser adjust the value.
You have two options, other than backing out: renegotiate the price with the seller (in your favor) or have your agent look through the appraisal to make sure the appraisal is accurate.
The appraisal is not always correct-I just had an instance where an appraiser used some inaccurate information and it was compelling enough to make the appraiser adjust the value.
- sctprop
- Contributions:182
The home inspection is always conducted prior to the bank appraising the house. It is rarer to have an appraisal problem although it is increasing as over cautious appraisers are causing chaos in the market. This happens mor ewith fha than any other loan it seems.
- Winfield Parkins, "teamleaderwin"
- Contributions:50
It depends on your contingency periods for both. If you have a 10 day inspection contingency and a 10 day appraisal contingency, then you need to get them both scheduled within that time frame. If you wait for the appraisal to be finished, your contingency period on your inspection may have expired and then you are out of luck.
- Laura Dobbins, "Laura Dobbins"
- Contributions:146
I always have my buyers do the inspection first - and here's why: the inspection costs about $250 - 300 whereas the appraisal costs about $400 - 500. If they are not satisfied with the condition of the property based on the inspection, then they have not spent a lot of money and can inexpensively terminate the contract, if they are still in the due diligence period. Here in Georgia, we usually have a due diligence period (commonly 14 days) where the buyer can cancel the contract and get back their earnest money with no penalty. The inspection is conducted during this time. If my buyers are concerned about issues revealed on the inspection report, we can go back to the sellers and negotiate for repairs. If an agreement cannot be reached at this point, we can terminate without having spent another $400-500 on the home. Talk to your seller; if his home is appraising for less than your contract, he's not going to be able to sell it to anyone else for more money and might as well work out with his "buyer in hand"!
- Anna Prasad, "annaprasad"
- Contributions:31
Inspection first and appraisal next. It is unfortunate that you got a low appraisal. I hope your are able to work out a compramise price for the house with the seller. Your agent should be able to guide you through this.
Best,
Anna Prasad
- James Dunn, "DunnRealtors.com"
- Contributions:373
Yes, this is the proper sequence.
- Erich Young, "Erich Young"
- Contributions:347
Inspect first, appraise second. The inspection was well worth it, but the appraisal issue is unfortunately a common occurance these days.
- Angela Hardy, "AngelaHardy"
- Contributions:339
You've done things in the correct order. Had you had the appraisal first and it came in low (and you were not able to reach a new agreement with the seller) you would have been out the cost of the appraisal (instead of the cost of the inspection). You are in a great position to renegotiate your purchase price. The sellers are also very invested in the sale at this point. They will feel good about making it past the inspection and have probably mentally moved on from the home.
- Julianne Krutka, "Julianne Krutka"
- Contributions:13
Dear jvbny,
You have done things correctly, the Inspection is traditionally conducted prior to Appraisal. I know it feels awful that you may be out that Inspection cost, but don't give up yet. With the appraisal in hand you are in a very good position to be able to renegotiate your purchase contract. Your lender won't lend on a property that does not appraise where you need it to appraise unless you come up with the extra cash to close the gap. The seller will have the same issues with other buyers. It is in the sellers best interest to renegotiate your contract to bring the sale price within range of the appraisal. I don't know many people who will pay a LOT more for a home than what the bank says it's worth so the seller should be willing to renegotiate with you.
I wish you well and would love to know how you make out!
Kind regards,
Julianne Krutka
Western MA and Northern CT REALTOR®
You have done things correctly, the Inspection is traditionally conducted prior to Appraisal. I know it feels awful that you may be out that Inspection cost, but don't give up yet. With the appraisal in hand you are in a very good position to be able to renegotiate your purchase contract. Your lender won't lend on a property that does not appraise where you need it to appraise unless you come up with the extra cash to close the gap. The seller will have the same issues with other buyers. It is in the sellers best interest to renegotiate your contract to bring the sale price within range of the appraisal. I don't know many people who will pay a LOT more for a home than what the bank says it's worth so the seller should be willing to renegotiate with you.
I wish you well and would love to know how you make out!
Kind regards,
Julianne Krutka
Western MA and Northern CT REALTOR®
- Ofe Polack, "Ofe Polack"
- Contributions:1420
The sequence is correct, you need to inspect the home to see if there are any issues that need to be corrected prior to closing. The bank orders the appraisal and if it has come lower than the offer and you wrote in the contract that the offer was contingent on property appraising on/above the offer, and it didn't you can walk out because the bank won't finance it. If that was not written in the contract and the seller wants to negotiate down to the appraised value you are in luck. I gather that you are not working with a buyer agent, are you?
- Marty Remo- REMO@RE/MAX!, "Remo Realty Group"
- Contributions:329
The sequence is right. Try to negotiate a better price based on the appraisal.
what's the right sequence: getting the bank's appraisal conducted, or getting your home inspected?
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