Appraisal came in at 45K less than offered. Now what will BOA do accept?,Decline?anybody experienced this before?
I made an offer 8-months ago, accepted by seller,approved by BOA and second. However now during the appraisal it comes in 45K less than offered. extension has beengranted 'til6/10 fom BOA-still waiting for second to provide extension.Really like the property and have been looking for 2-yrs. However the market seems to be declining still. Will Bank accept new offer? anybody has experience this? with such a "BIG" gap from offered price to appraised price? the seller already moved and will go into forclosure if the deal doesn't come through since the original approval expires 5/28/2010
If they accept the new offer it will be 86.6% of listing price.
My original offer was 102.0% of listing price. but 8-months later a lot of things have changed.
Suggestions, Thoughts,ideas,or experiences shared will be greatly appreciated
Replies to This Discussion
-
Permalink Reply by Kent Dills on
-
Dee, no disrespect intented, but the ratios compared to List Price are immaterial as far as your lender and the sellers lender are concerned. They only care about the value of the collateral (the house). So, your lender doesn't what to lend more than the house is worth (good business practice) and the seller's lender wants to get as much money back as they can on the original loan when the property use to be worth more; but, at the same time, they should be realistic about the current value too. That's why cash buyers are preferred because there are no hassles about the appraisal coming in low.
The key to this is to get the seller's lender to accept your appraisal as THE VALUE. You should offer to pay for another BPO (about $50-$80) if they want to get a second opinion of value (and they should). Maybe they've already ordered another BPO!
Anyway, once a "reasonable" agreement on current value is determined, be prepared to pay about 90-93%% of that value for the home. That will net seller's lender about 81-84% of the current value which is about what they all want. -
-
Permalink Reply by Keli Amparan on
-
I am in a similar situation but my appraisal came back only $10K less than the contract price. We also need an extension which the LA asked for over two weeks ago. He has not been able to get in touch with the negotiator to grant our extension and our contract expires on 6/1. Dee, how did you get the extension to your contract? Any help would be appreciated as I only have three business days to take care of this
-
-
-
Thank you Kent, 90% will get us only 10K from current appraisal, which will be ok and can be negotiated. I just wasn't sure what was the least % acceptable in a short sale.
Kent Dills said:Dee, no disrespect intented, but the ratios compared to List Price are immaterial as far as your lender and the sellers lender are concerned. They only care about the value of the collateral (the house). So, your lender doesn't what to lend more than the house is worth (good business practice) and the seller's lender wants to get as much money back as they can on the original loan when the property use to be worth more; but, at the same time, they should be realistic about the current value too. That's why cash buyers are preferred because there are no hassles about the appraisal coming in low.
The key to this is to get the seller's lender to accept your appraisal as THE VALUE. You should offer to pay for another BPO (about $50-$80) if they want to get a second opinion of value (and they should). Maybe they've already ordered another BPO!
Anyway, once a "reasonable" agreement on current value is determined, be prepared to pay about 90-93%% of that value for the home. That will net seller's lender about 81-84% of the current value which is about what they all want. -
-
Permalink Reply by Alan Remigio on
-
Dee,
When the appraisal creates that wide of a gap, you must let BofA know. For them to stick to their request for the higher offer without recourse can easily create the argument for overvalue and unfair business practice. Overvalue(lenders) and undervalue (buyers, resellers and investors) are hot issues in short sales and lenders are overlooked many times as being the "hurt" party. They know what they are doing. I've asked for another appraisal and adjustment of price. I've also withdreawn my offer and resubmitted a new offer and both worked with BofA. That's two ways I've negotiated a sale. Escalation certainly supports the first option.
Buyer's lender will certainly not create a loan accommodating the sales figure knowing the lower value. Push for an appraisal from BofA. BofA may order another value which should only be a complete appraisal. Start escalating if the current negotiator does not budge. When escalating, look through these past comments on the BofA site for direction to the upper levels.
If your Buyer has cash, regardless, are we really doing him a favor? -
-
-
Alan,
Is there any way to do what you've suggested if you are short on time? My approval contract expires on 6/1. We've been trying to get an extension but the negotiator is 'out of the office' and is not returning my LA's emails. Any advice on getting an extension so we can pursue another appraisal? -
-
-
I'm a buyer with a VA loan and this happened to me. My offer was $240k (8 months ago) and BOA's recent crazy high BPO came in at $295k. I accepted their $295k conter offer knowing it wouldn't appraise and sure enough my VA appraisal came in at $235k. The listing agent notified them of this 2 weeks ago and just today they have countered at $250k.
So now I have to decide what to do. I'm a first-time home buyer with $8k coming to me if we close by the 6/30 as everyone knows. FMV has been established by the appraisal and not by their BPOs. I may come up to my original offer of $240k and also semi-threaten them with a complaint to the State Attorney General's office for not negotiating in good faith. The investor is Freddie Mac. -
-
-
Tim- Will the VA fund a loan when you buy a house above appraisal price? I know you can contribute money if you want, but then you're in an upside down position and it was my understanding that the VA protects it's clients so that they aren't in that position by not allowing the funding of a loan where the appraisal is less than purchase price. Were you able to get an extension on your COE date? How did you find out who the investor was as well?
-
-
Permalink Reply by Nikki on
-
Hi Dee-
I too am in the same postion and our appraisal came in 50k less that than offered. Our timeline was due for tomorrow and we are trying to get an extension. We are suppose to receive a response today as our file has been escalated to a Sr. negotiator for three days now. I am still waiting.
I would have your SA call this number to escalate as we got through to a live person. They helped a bit to make sure our file was being escalated.
Please keep me posted on your outcome as I will do with mine. Thanks!
Office of the President/CEO for BofA:
1-704-386-5681 -
-
-
I'll definitely keep you posted!! Thanks for the info. Did your SA make the call or did you? Our negotiator and his supervisor are both out of the office this week. I went to a BoA branch manager and asked that the escalate for me, but he had no idea what I was talking about (I'd seen posted on here that I could do this, but apparently he didn't get the memo). He did email the negotiator and his supervisor and stated that I'd been to see him and that I was concerned about the lack of response to our request for an extension. We'll see what happens. I also drove by the main BoA offices where they process all short sales, 'so near and yet so far...." but I didn't feel like I could go in and ask to speak to someone. If I don't have a response by Tuesday (our approval letter expires on 6/1) then I may change my mind and park myself there until I get a response.
-
-
-
Hi Keli,
I made the call first and the person told me it needed to be the SA to make the call. I forward the number to the SA and had her call to tell them about our situation. I am hoping she is constantly calling them right now because we don't have much time left. I am hopeful we will a response soon. =/ -
-
-
@Keli My mortgage broker told me I can contribute over the appraised value. The VA funding fee (basically MI) is paid upfront so VA (or the investor) is already covered. I don't believe that they really care if you over pay for the house as long as it doesn't affect your ability to qualify or make a down payment. I'm going 0% down so it doesn't really affect me. We currently don't have a closing date right now and have already blown through about 3 of them. I'm already approved for my loan and there were no VA appraisal/inspection deficiences so it's only going to take me 2 weeks to close once I get final approval.
I'm 99% sure the investor is Freddie Mac because we got sent over to Titanium Solutions in January because they were contracted by Freddie Mac to do short sales. But then that all changed in March and we had to go through Equator. There are websites that can tell you if the investor is Freddie or Fannie by having the seller input their loan info. I don't have the URLs but there listed on this site somewhere. -
-
-
Thank you everyone..but I'm ready to walk if There is a "no" from the bank...will look for another place..not by choice but it's just the way the market condition is...I can't come out with the $ difference and will be "under" from day one, should I decide to get the money for the difference...All I can do is wait and see...Heartbreaking but either the bank accepts or they will have to accept a lesser offer a few months later due to the decline...they are the ones who took this long and this is the outcome...maybe in a year or two the price will be even less than now....:(
-
© 2024 Created by Short Sale Superstars LLC.
Powered by
**********************************
like buttons