Sunday, February 15, 2015

Appraisals Come In Low From Time to Time

What can I do when my appraisal came in too low?

1) You may be paying too much for the property - renegotiate the purchase price.

2) If it is less than 10% low you might consider switching to an FHA 203k loan, even a streamlined k, or "limited 203k" which it is about to be called will gain you up to a 10% advantage on the appraised value and you get to use the appraised value as if the work is completed.

3) Reach a new "middle ground" on the selling price
Any of these are a possible solution to your problem.

What happens if the seller won't budge on their selling price?

That is a real problem. You can't negotiate with idiots.

1) They have no sense of the reality of their situation... their agent or Broker failed to school them on the real value of the property.

2) They weren't aware of the issues that surrounded their property. Many times the seller knows exactly what is wrong with their property, They have ignored and deferred maintenance for twenty or more years and now expect that some buyer will come in an buy it at full price. This is NOT a savvy seller. They are responsible for the condition of the property unless they inherited it but in any case they need to deliver the property in a safe condition or adjust the price to make it a safe condition.

3) If they weren't aware of the issues, they are now and they should be sharing them (disclosing them) with future potential buyers. I've actaully seen some sellers Agents tell us that they don't want any reports... that is so they don't think they need to disclose the findings. Beware, you seller's agents, just because it isn't in writing doesn't mean you don't need to disclose the issues that are apparent. In fact when push comes to shove and it should go to court... the judge may not like the idea that YOU told the buyer's you didn't want any written reports. Sounds like you knew the issues and just didn't want to disclose them.

We have a new office in St Lucie County FL and Pete Campbell is ready and willing to help you with issues that come up and help get your 203k closed quickly. In case you think a 203k takes longer to close than a standard FHA loan (203b), you would be wrong. They can close in the same length of time. All depends on getting the "TEAM" working for you and your client. The Mike Young Team has been doing just that for over twenty years now. Lets us be part of your team.