Posted by garnet71 on April 27, 2009, at 18:50:56
I'm working on selling my house.
So back when I was in the mortgage business, most of the appraisals of homes (for refinances and purchases) conveyed inflated values. It was the norm.
One of ny neighbors, who works as a settlement contractor, told me they've recently cracked down on appraisers since the subprime mortgage crisis....
So back then, any appraiser would make the value the exact amount needed to make the deal work (or higher)...Since this changed, I'm wondering how it affects real estate transactions.
So if I were to put my home on the market for 20% higher than similar houses have (recently) sold in my neighborhood, and enter into a contractual agreement at that price, I'm thinking if the appraisal comes in lower than the sale price, the mortagage underwriter would require the borrower(s) to come up with a higher down payment--which can ruin a deal. Not sure how this has changed...
In effect, I'm concerned the appraised value (during the mortgage process) will come in lower than the sale price agreed upon. This is based on comparable sales of homes in my area I"ve consistently checked upon over the past year.
The value of a home is really what someone would purchase it for--as opposed to the appraised value (from a licensed R.E. appraiser). But I know how appraisals work--they have to go by recent sales, though adjustments are calculated; not as much weight, however, goes towards such adjustments.
So that's the issue. A house is worth what people are willing to pay for it, but an appraisal, given the recent variables, can mess up a deal..or so I am suspecting.
Any input would be appreciated! Real estate people, or if you've recently sold a home....Many thanks!!
poster:garnet71
thread:893129
URL: http://www.dr-bob.org/babble/social/20090421/msgs/893129.html