Appraisal came in $5k short, run or stay?

[ccutequeen]

Ok, so I have been looking for a cute little place for myself for the past 2 years and finally find this condo in mission valley that i like. Its from 80s and need some update but it has 2bed/2bath, two story which I don’t find often, if at all, in my price range. Being a REO, I offered a little bit more than asking with 20% down. Now couple weeks later, did inspection, ordered HOA doc…appraisal came back and it show $5k short. The bank, B of A (really don’t like them), refuse to adjust the price base on appraisal and insist buyer to pay the difference.
I am very confused right now as of what to do. If I back out, I am $900 out and got nothing. If I go with it, I will have to $5k more…and I just don’t know if its a good idea to buy something for $5k more if appraisal set the value to be less. Being first time home buyer, I am just bit lost right now.
Any advise is appreciated!

[sdrealtor]

It really depends upon what its worth compared to the comps. The appraisal may have been overly conservative. Sometimes a property is relatively rare and there just arent good comps for it. I had that happen last week in Murrietta on a listing for a 1 story on an 19,000 sq ft lot in a neighborhood of homes like that. There werent good recent comps so they went to the neighborhood next door and tried to use a 2 story on a 6,000 sq ft lot as a comp. I told the U/W to go F^%&*^K himself. They ordered an appraisal review, saw what I was talking about and resolved the issue in my favor. It doesnt always work that way even though it should.

With that said, by closing in the next month you will get an $8,000 1st time homebuyer credit from Uncle Sam which you might not get on the enxt property. Without intiminate knowledge of the property its hard to say but it could easily be worth going forward due to the $8K credit.

At that price they will likely have no problem finding someone else to step up.

[sdrealtor]

It really depends upon what its worth compared to the comps. The appraisal may have been overly conservative. Sometimes a property is relatively rare and there just arent good comps for it. I had that happen last week in Murrietta on a listing for a 1 story on an 19,000 sq ft lot in a neighborhood of homes like that. There werent good recent comps so they went to the neighborhood next door and tried to use a 2 story on a 6,000 sq ft lot as a comp. I told the U/W to go F^%&*^K himself. They ordered an appraisal review, saw what I was talking about and resolved the issue in my favor. It doesnt always work that way even though it should.

With that said, by closing in the next month you will get an $8,000 1st time homebuyer credit from Uncle Sam which you might not get on the enxt property. Without intiminate knowledge of the property its hard to say but it could easily be worth going forward due to the $8K credit.

At that price they will likely have no problem finding someone else to step up.

[sdrealtor]

It really depends upon what its worth compared to the comps. The appraisal may have been overly conservative. Sometimes a property is relatively rare and there just arent good comps for it. I had that happen last week in Murrietta on a listing for a 1 story on an 19,000 sq ft lot in a neighborhood of homes like that. There werent good recent comps so they went to the neighborhood next door and tried to use a 2 story on a 6,000 sq ft lot as a comp. I told the U/W to go F^%&*^K himself. They ordered an appraisal review, saw what I was talking about and resolved the issue in my favor. It doesnt always work that way even though it should.

With that said, by closing in the next month you will get an $8,000 1st time homebuyer credit from Uncle Sam which you might not get on the enxt property. Without intiminate knowledge of the property its hard to say but it could easily be worth going forward due to the $8K credit.

At that price they will likely have no problem finding someone else to step up.

[sdrealtor]

It really depends upon what its worth compared to the comps. The appraisal may have been overly conservative. Sometimes a property is relatively rare and there just arent good comps for it. I had that happen last week in Murrietta on a listing for a 1 story on an 19,000 sq ft lot in a neighborhood of homes like that. There werent good recent comps so they went to the neighborhood next door and tried to use a 2 story on a 6,000 sq ft lot as a comp. I told the U/W to go F^%&*^K himself. They ordered an appraisal review, saw what I was talking about and resolved the issue in my favor. It doesnt always work that way even though it should.

With that said, by closing in the next month you will get an $8,000 1st time homebuyer credit from Uncle Sam which you might not get on the enxt property. Without intiminate knowledge of the property its hard to say but it could easily be worth going forward due to the $8K credit.

At that price they will likely have no problem finding someone else to step up.

[sdrealtor]

It really depends upon what its worth compared to the comps. The appraisal may have been overly conservative. Sometimes a property is relatively rare and there just arent good comps for it. I had that happen last week in Murrietta on a listing for a 1 story on an 19,000 sq ft lot in a neighborhood of homes like that. There werent good recent comps so they went to the neighborhood next door and tried to use a 2 story on a 6,000 sq ft lot as a comp. I told the U/W to go F^%&*^K himself. They ordered an appraisal review, saw what I was talking about and resolved the issue in my favor. It doesnt always work that way even though it should.

With that said, by closing in the next month you will get an $8,000 1st time homebuyer credit from Uncle Sam which you might not get on the enxt property. Without intiminate knowledge of the property its hard to say but it could easily be worth going forward due to the $8K credit.

At that price they will likely have no problem finding someone else to step up.

[Arraya]

Why are you thinking of over paying rather than them thinking of selling it for what it’s worth? With all the shadow inventory you should not be comfortable overpaying.

[Arraya]

Why are you thinking of over paying rather than them thinking of selling it for what it’s worth? With all the shadow inventory you should not be comfortable overpaying.

[Arraya]

Why are you thinking of over paying rather than them thinking of selling it for what it’s worth? With all the shadow inventory you should not be comfortable overpaying.

[Arraya]

Why are you thinking of over paying rather than them thinking of selling it for what it’s worth? With all the shadow inventory you should not be comfortable overpaying.

[Arraya]

Why are you thinking of over paying rather than them thinking of selling it for what it’s worth? With all the shadow inventory you should not be comfortable overpaying.

[sdrealtor]

Just to clarify an appraisal is not necessarily an opinion of market value but rather appraised value. Here is an extreme example. Someone discovers a new item. It’s impossible to appraise it because there is nothing like it to base its value on so the market will determie the market value. While appraisals are often good estimates of fair market value they arent always. If the property doesnt have good comps of similar properties the appraisal will be tough but that doesnt mean the property isnt worth it.

You really need someone to do a good market analysis to see if the price holds water.

[sdrealtor]

Just to clarify an appraisal is not necessarily an opinion of market value but rather appraised value. Here is an extreme example. Someone discovers a new item. It’s impossible to appraise it because there is nothing like it to base its value on so the market will determie the market value. While appraisals are often good estimates of fair market value they arent always. If the property doesnt have good comps of similar properties the appraisal will be tough but that doesnt mean the property isnt worth it.

You really need someone to do a good market analysis to see if the price holds water.

[sdrealtor]

Just to clarify an appraisal is not necessarily an opinion of market value but rather appraised value. Here is an extreme example. Someone discovers a new item. It’s impossible to appraise it because there is nothing like it to base its value on so the market will determie the market value. While appraisals are often good estimates of fair market value they arent always. If the property doesnt have good comps of similar properties the appraisal will be tough but that doesnt mean the property isnt worth it.

You really need someone to do a good market analysis to see if the price holds water.

[sdrealtor]

Just to clarify an appraisal is not necessarily an opinion of market value but rather appraised value. Here is an extreme example. Someone discovers a new item. It’s impossible to appraise it because there is nothing like it to base its value on so the market will determie the market value. While appraisals are often good estimates of fair market value they arent always. If the property doesnt have good comps of similar properties the appraisal will be tough but that doesnt mean the property isnt worth it.

You really need someone to do a good market analysis to see if the price holds water.

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