Low Appraisal

So here is my issue. We had an appraisal done on the short sale we are trying to buy. The house is selling for $180k but the appraisal only came in at $175k. We have to pay the FHA down payment of 3.5% which is $6,400.00. After we pay this amount the loan amount will be $ 174k. So I guess my question is, wont the appraisal amount be fine since we technically only need to loan amount of $174k after the down payment amount?

Thank you!

Ashley S.

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Permalink Reply by Wayne Brooks on August 20, 2012 at 10:06am

As Brian said, FHA is only going to loan you 96.5% of appraisal, assuming appraisal is lower than purchase price).

But, your first action should be having the realtor/3rd party doing the negotiation present the 175K appraisal to the Sellers' lender so your purchase price is reduced to $175k.  An FHA appraisal trumps a $50 BPO, sometimes.

Permalink Reply by Joan Park on August 20, 2012 at 5:47pm

But, your first action should be having the realtor/3rd party doing the negotiation present the 175K appraisal to the Sellers' lender so your purchase price is reduced to $175k.  An FHA appraisal trumps a $50 BPO, sometimes.

I agree with Wayne.:)

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