Low Appraisal - So Bummed To Say The Least - Page 2

[2busy2clean]

Desperate times call for desperate measures (or somtin like that!)

Could you finance a part of your development with a business loan -- and then board a few horses?? If your property is the only one with an indoor riding arena, I would think that would be possible. But I know nothing about business loans...

I do agree that the comps aren't good. Hope that things clear up for you soon!

[KnittingShaker]

Originally Posted by lucyem

Out of it all the part I find the most frustrating is the comps were not comps. I know we are totally unique. But the horse property part - I know of 3 that have sold in the area and not one was used as a comp. We have views and not one comp had views. The solar he would never find because there is no comparable. But the comp houses he did pull up all had less rooms, less bathrooms, less land. They are all 15-27 years older then our house. It makes no sense to me to take comps that in no way resemble any part of our property, use their sale prices in the past year, and tell me thats what my house appraises at.

If you review the appraisal, I'm sure that you will find that adjustments were made for all of these items.

If you can find a true comp (in your immediate area, sold within past three months, same style/age/size as your home) that the appraiser didn't use for whatever reason, bring it to the attention of the appraiser. That can't hurt.

I think that in the coming months, we are going to see a lot of people refinancing that don't like the value the appraiser comes up with...

[Caneel]

I was an appraiser for seven years and would often get the call to review other appraisers work. Unfortunately, there are a lot of appraisers who are not qualified to handle unique properties (or any property for that matter) and also a lot of appraisers who bend to the lender. Laziness and inexperience on the part of the appraiser often resulted in these types of problems.

Without judging your particular situation, it was not unusual for me to be brought in to situations just like you are describing - second appraisal lower than the first.

Any qualified, ethical appraiser should be willing to sit down and answer all your questions and concerns. He/she should be able to defend and support their choice of comparables and adjustments, with the appropriate market data to support the allocations. If he/she is unwilling to answer tough questions, that is a huge red flag.

You should put your list on concerns on paper and make the lender coordinate the meeting. It is important that the lender be involved in all interactions. If you meet resistance, go to another bank.

What you should not do is get your own appraisal done and expect the bank to accept it. Every bank I worked for had policies against accepting owner-engaged appraisals. (I worked at a bank after the appraisal career)

[KnittingShaker]

Originally Posted by Caneel

I was an appraiser for seven years and would often get the call to review other appraisers work. Unfortunately, there are a lot of appraisers who are not qualified to handle unique properties (or any property for that matter) and also a lot of appraisers who bend to the lender. Laziness and inexperience on the part of the appraiser often resulted in these types of problems.

Without judging your particular situation, it was not unusual for me to be brought in to situations just like you are describing - second appraisal lower than the first.

Any qualified, ethical appraiser should be willing to sit down and answer all your questions and concerns. He/she should be able to defend and support their choice of comparables and adjustments, with the appropriate market data to support the allocations. If he/she is unwilling to answer tough questions, that is a huge red flag.

You should put your list on concerns on paper and make the lender coordinate the meeting. It is important that the lender be involved in all interactions. If you meet resistance, go to another bank.

What you should not do is get your own appraisal done and expect the bank to accept it. Every bank I worked for had policies against accepting owner-engaged appraisals. (I worked at a bank after the appraisal career)

99% of the time, an appraiser is selected by the lender. Even if the borrower pays for the appraiser, most appraisers will not talk to a borrower after the appraisal is complete.

[Cheshire]

If the tax value on your home is higher than what you currently owe talk to the bank about using the tax value instead of the appraisal.

I've heard of people using tax values (and not needing an appraisal) for home equity loans.

I guess this would only work if the tax value is high enough to meet your refinancing needs.

Best wishes!

[lucyem]

My husband was on the phone with the appraiser for 30 minutes. He is going to readjust figures for us. Sigh. We got the same line of its unique, no comps, he knows the house would sell for double his appraisal in this bad economy, etc. Why in the world he did not just give us the number we needed in the first place?

[KnittingShaker]

Originally Posted by lucyem

My husband was on the phone with the appraiser for 30 minutes. He is going to readjust figures for us. Sigh. We got the same line of its unique, no comps, he knows the house would sell for double his appraisal in this bad economy, etc. Why in the world he did not just give us the number we needed in the first place?

Please report back once the lender sees the revised appraisal. I am very interested in what they say.

[daniedb]

Originally Posted by lucyem

My husband was on the phone with the appraiser for 30 minutes. He is going to readjust figures for us. Sigh. We got the same line of its unique, no comps, he knows the house would sell for double his appraisal in this bad economy, etc. Why in the world he did not just give us the number we needed in the first place?

Some places appraisers will lowball because the homeowners can pay fewer taxes. That happens here a lot. There was a stink a while ago where one small area of our town (the historic area), was being appraised very low, for tax breaks to encourage people to move in and gentrify. :

[kijip]

Originally Posted by KnittingShaker

A market value by a real estate broker is completely different than an appraisal done for lending purposes. If a borrower brought in a market value and expected to use it as an appraisal they would get laughed at. Literally.

It is different, but it is not always the case that the market price comes in higher than the appraisal- for example, we paid less for our new house than our lender appraised it at because the developer was eager to make the sale and took our low ball offer. In that case, the appraiser was likely pulling comps from a few months ago and the market had edged off slightly.

[lucyem]

I was asked to post after everything got sorted out. The appraiser sent in new figures. The loan officer at the bank submitted them to underwriting. She had jumped the gun and submitted the lower appraisal last week before talking to us. So the underwriter saw both appraisals (grrrrr). They are willing to give us the refinance but only part of what we need. If the loan officer had not sent in things before talking to us we would have been fine. Now we have to sit down and figure out if the refinance will even work. We have to decide by 2. Today is the deadline.

[KnittingShaker]

Originally Posted by lucyem

I was asked to post after everything got sorted out. The appraiser sent in new figures. The loan officer at the bank submitted them to underwriting. She had jumped the gun and submitted the lower appraisal last week before talking to us. So the underwriter saw both appraisals (grrrrr). They are willing to give us the refinance but only part of what we need. If the loan officer had not sent in things before talking to us we would have been fine. Now we have to sit down and figure out if the refinance will even work. We have to decide by 2. Today is the deadline.

Hope I'm not too late.

If the u/w uses the lower appraisal (which they very well may do) and the refi doesn't work for you that way, you can try the following: ask your loan officer if you withdraw if they will sign the appraisal over to another lender. If they agree (get it in writing) you can try to reapply with another lender (tell them upfront you have your appraisal already) and MAKE SURE the appraiser sends the new lender the higher appraisal.

Good luck.

[Caneel]

99% of the time, an appraiser is selected by the lender. Even if the borrower pays for the appraiser, most appraisers will not talk to a borrower after the appraisal is complete.

Yes, I agree that the appraiser is nearly always selected by the lender, maybe my wording was confusing as I meant to convey that the OP should not go out and get their own appraisal.

In my geographical (small town) area, it is very common for a banker to service their customers in appraisal disputes when the customer has valid concerns. Maybe in more urban areas, this type of follow-thru is not the normal.