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user5292948

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Appraiser versus Lender Valuations

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Thanks Vince.This is a conventional loan on a Single-Family residence.The 1st team of appraiser/lender did meet.  However, since the valuation was so far apart ($225k variance), they could not reconile the gap.  The lender decided it was "too hard" (read:  too risky) for them to move forward.The 2nd team of appraiser/lender had similar results.  The lender took one look at the appraisal report and said "not even close".The 2 appraisal reports and our offer do all "align" (literally to the dollar - which is incredibly coincidental in my opinion).  However, we expected our offer was on the "high side" and expected the appraisal to come in lower.  We had planned on this being the catalyst for us to adjust the price with the seller.  Instead, the appraisers are both saying "yep price looks good" and the Lender's are saying "no way".  I'm no appraiser, but do work a lot with numbers. Even I have been able to shoot holes in the appraisal reports.We may wind up back with the Seller and an adjusted price (not sure how receptive they will be).  I was hoping to find an alternative solution to put on the table also.  Owner financing is one option which we can discuss.Are there other ways to structure this deal?Thanks!

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Financing a purchase

Answer

Our issue is the other way - in that the appraisals are "too high". I am no real estate expert, but even I can shoot holes in both appraisals. As such, so have both lenders. I was under the impression that after the housing bubble burst and the changes by the fed, that appraisers would be more conscience of the "real value" of the asset. In our case, both "independent appraisals" came in at the exact same amount - awful coincidental that it aligns. They happen to align with our offer - which we expected was on the high side and would get adjusted based on the appraisals. We didn't expect such a huge gap. The surprising part is that the appraisers have aligned PERFECTLY with our offer, versus providing a true market value. Their assumptions to get to the higher valuation are VERY thin. I just want/need an accurate appraised value from an independent impartial expert. I thought that's what appraisers did!

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Appraiser versus Lender Valuations

We have an offer that has been accepted on a property. The appraiser issued their report. However, it was immediately flagged by the lender. Their internal review generated a value that was $225k less than the appraisers report. Admittedly, this is a difficult property to appraise since the lots size, house sq ft, and overall status create different opinions. This has happened 2x now with 2 separate Lender/Appraise teams. We are not in a position to bridge this gap with cash. Are there other financing alternatives we can/should pursue? Is there a way to "force" the lender and appraiser to align on a valuation? Thanks! T-

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Financing a purchase

We have an offer extended on a house in San Rafael. The property is unique in several regards. First, the lot is over 3 acres in size - and still in town - compared to other lots which range anywhere from 7000 - 14000 sq ft. Secondly, the house is relatively small - only 1200 sq. feet. Lastly, the house is in dis-repair. It has not been lived in for over 20 years. It's been used as a summer/vacation destination. All of which makes the house difficult to "comp". We've had an appraisal done. Unfortunately, the appraiser and the lender have valued the property dramatically different. In fact, the lender has valued the property $225k less than the appraiser. This delta has happened 2x now with 2 separate lender/appraiser teams. We are not in a position to make up this much of a difference with cash. Are there other financing alternatives we can utilize to close on this deal? Thanks! T-

  (0)