Citi approved short sale, but then my (buyer) appr came in lower!
Also, posted this in general forum, but will post it here too.....
Hi everyone. I need all the advice I can get. I live in CT (wanted to mention the state). Back in July, my husband and I put an offer on a short sale condo that we love. Waited, and waited......We are first time homebuyers.
FINALLY, citimortgage approves our offer the second week of Nov. Condo docs ordered, atty orders title search, then last week, our lender did ANOTHER appraisal, the appraisal came in 7,000 LOWER than what citimortgage approved a few weeks earlier. We have tried contesting the appraisal, but no luck.
Our attorney, and agent have both tried to be in contact with citi to see if the lower price will be accepted. There has been no response. We were about to cancel, as we have waited, but then my agent says the listing agent says there should be a response within 3-4 weeks. This was AFTER we were told we would know something by this Tuesday. If it is only 3-4 weeks we have to wait, we can hang on, but we were also told by our attorney that it could take just as long for an answer this time as it did going in (5 months). We would obviously love to be able to buy the place, but also want to know if it is time to move on if citi does not approve our offer. So my questions are....
In a short sale when the buyer's appraisal comes in lower than what they bank approved, is there any hope, and also, will it take just as long to get another response? Thank in advance for any advice. We are getting anxious and frustrated.
Lauren
Replies to This Discussion
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Permalink Reply by Tara Samney on
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Hi Lauren, You don't mention who the investor is on the loan or if there is mortgage insurance which makes a big difference.I've gotten Freddie Mac to approve a reduced amount when the buyer's appraisal was provided, usually within 2 weeks while file was open. However, if there is mortgage insurance it has to go through that hurdle or if it is a private investor they may just say no. So, yes there is hope. However, remember that the time you wait is no indicator of whether you will get the house or not, as hard as it is. If it is something you are not prepared to wait on- you may want to look elsewhere. I'd ask who the investor on the loan is (if there is just 1 or 2) and if there is mortgage insurance....it would help give a better timetable. I don't know why it would take 5 months unless approvals expired and file was closed.
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Permalink Reply by Lauren O on
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Hi Tara! When you say Mortgage insurance, do you mean will we have mortgage insurance as new homeowners? If so, yes we will as we will not be able to put 20% down. If you mean did the seller have mortgage insurance, I am not sure. I will try and ask my realtor if she can find out, b.c that is something I honestly never thought of. What I can tell you about the seller is this....
She is deceased, and has been for a yr. I hear there is that long of unpaid HOA dues.
B/c of this, there really is no seller, just one of her kids that does not own the property that is her conservator that signs off on the paper where it requires a seller's signature, but they do not own the property.
The previous owner had only bought the condo in 2008 and paid WAY more than what it would go for now.
Thank you for your advice, I will def ask my realtor and attorney to ask about this.
Lauren
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Hi Lauren,
If the seller had mortgage insurance on it- then the mortgage insurer also has to agree on lower price. Some of my biggest hold-ups were waiting on that. There some unknowns here- much of the speed of the review will depend upon the speed the conservator returns documents requested. They also should have asked you to sign an addendum at the new price to be considered.
I've gotten Citi to come down before on a Freddie Mac backed loan, so it is possible. The buyer's appraisal counts for a lot.
Good luck!
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Permalink Reply by TOP END Properties on
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Usually they will lower the acceptance to the appraised value.
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