- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
House buying question - didn’t meet appraisal Update: pg 3
Posted on 9/10/22 at 10:03 am
Posted on 9/10/22 at 10:03 am
We have put an offer on a new house and have a contract on our current house to sell. Appraisal came in $85k low on the new house. We have $7k in earnest money on the new home and the buyer of our current home has done inspection and appraisal and we are all set to sell.
1- are we obligated to sell our house still if we don’t buy the next house? We haven’t closed.
2- if the sellers of the next house don’t agree to come down on price, is our earnest money gone?
3- I believe the appraisal is low. Our offer price may be high but the appraisal is seemingly abnormally low. I have a buddy in the same area with comparable finish out. The house we have an offer in on has an extra 1.5 acres. Buddys price per sq for was $233, and the offer we made is $259. The appraisal came in basically at $227 per sq ft. I don’t really want to contest the value rather make the buyers come down to meet appraisal or make them prove value but this seems like an unlikely outcome.
Anyone have any experience with this scenario? I don’t care if we move or stay. At this point, this process has been a complete cluster so I just want to stop the process and be done looking for a new house. Just curious what the penalties here will be.
1- are we obligated to sell our house still if we don’t buy the next house? We haven’t closed.
2- if the sellers of the next house don’t agree to come down on price, is our earnest money gone?
3- I believe the appraisal is low. Our offer price may be high but the appraisal is seemingly abnormally low. I have a buddy in the same area with comparable finish out. The house we have an offer in on has an extra 1.5 acres. Buddys price per sq for was $233, and the offer we made is $259. The appraisal came in basically at $227 per sq ft. I don’t really want to contest the value rather make the buyers come down to meet appraisal or make them prove value but this seems like an unlikely outcome.
Anyone have any experience with this scenario? I don’t care if we move or stay. At this point, this process has been a complete cluster so I just want to stop the process and be done looking for a new house. Just curious what the penalties here will be.
This post was edited on 9/12/22 at 11:32 am
27
Posted on 9/10/22 at 10:05 am to WhiskeyThrottle
Talk to your agent about all of this
But yes to this answer, at least that’s my understanding. That’s the point of earnest money.
Did you waive the appraisal? If you did not, you may still be ok. But again, ask your agent.
quote:
2- if the sellers of the next house don’t agree to come down on price, is our earnest money gone?
But yes to this answer, at least that’s my understanding. That’s the point of earnest money.
Did you waive the appraisal? If you did not, you may still be ok. But again, ask your agent.
This post was edited on 9/10/22 at 10:07 am
Posted on 9/10/22 at 10:07 am to cas4t
quote:
Did you waive the appraisal?
Big question.
Also was your home sell contingent on the other house closing.
This post was edited on 9/10/22 at 10:08 am
Posted on 9/10/22 at 10:07 am to WhiskeyThrottle
Experienced a somewhat similar situation, although the appraisal in our case was nowhere near that low.
We told the seller we were backing out since we could not get financing with the low appraisal, and within a few hours they came back with an price a little above the appraisal. We accepted their offer and eventually closed.
We told the seller we were backing out since we could not get financing with the low appraisal, and within a few hours they came back with an price a little above the appraisal. We accepted their offer and eventually closed.
Posted on 9/10/22 at 10:08 am to WhiskeyThrottle
Dissect the frick out of the appraisal and make sure they used the correct comps.
You can always pay for your own appraisal to compare to the one the bank ordered and that’ll help your argument
You can always pay for your own appraisal to compare to the one the bank ordered and that’ll help your argument
Posted on 9/10/22 at 10:09 am to WhiskeyThrottle
Appraisers are horrible at pricing acreage but in the same breath is that extra acreage worth $60k and acre?
Most of your questions depend on your contracts. You aren't likely going to have to sell your current house if you haven't closed, there are probably a million ways to get out of the contract. You earnest money again depends on your contract, did you wave an appraisal contingency?
I think it is pretty shitty to back out of the sale of your home at this point but nobody is going to force you to follow through with the sale.
Most of your questions depend on your contracts. You aren't likely going to have to sell your current house if you haven't closed, there are probably a million ways to get out of the contract. You earnest money again depends on your contract, did you wave an appraisal contingency?
I think it is pretty shitty to back out of the sale of your home at this point but nobody is going to force you to follow through with the sale.
Posted on 9/10/22 at 10:10 am to fightin tigers
He could also likely nitpick the shite out of the inspection to get out of it too, unless he of course waived the inspection.
Posted on 9/10/22 at 10:11 am to cas4t
What does waiving the appraisal mean? Like not make the offer contingent on the appraisal?
We do have a contingency on the deal if we can’t sell our current house, then we are out. But that’s the only contingency I know of.
I am waiting to see what my agent does. I don’t feel like arguing for a higher valuation since it may only work in my favor being low. But she does want to argue it. Just don’t know what our options are at this point on selling our current home. Don’t care if we move or stay. Im not bridging an $85k gap to save my $7k in any case.
We do have a contingency on the deal if we can’t sell our current house, then we are out. But that’s the only contingency I know of.
I am waiting to see what my agent does. I don’t feel like arguing for a higher valuation since it may only work in my favor being low. But she does want to argue it. Just don’t know what our options are at this point on selling our current home. Don’t care if we move or stay. Im not bridging an $85k gap to save my $7k in any case.
Posted on 9/10/22 at 10:11 am to armsdealer
quote:
but nobody is going to force you to follow through with the sale.
Not 100% true, but there will have to be legal action and a lot more money spent. Most people will not take that route.
Posted on 9/10/22 at 10:12 am to armsdealer
He could always ask to amend the sell of his home too to allow him X amount of days to rent his own home back to the new owners.
So still sell it, get the cash from it so he is no longer contingent, and have some extra time to work this issue out
So still sell it, get the cash from it so he is no longer contingent, and have some extra time to work this issue out
Posted on 9/10/22 at 10:13 am to WhiskeyThrottle
quote:
We do have a contingency on the deal if we can’t sell our current house, then we are out. But that’s the only contingency I know of.
It would be dual contingency. It seems like agents are more hesitant to do dual contingencies for some reason these days.
I was kindof in your situation and my plan was just to walk away and tell the buyer of my house to sue me if things went south.
Posted on 9/10/22 at 10:14 am to WhiskeyThrottle
How did your agent design your contract?
Posted on 9/10/22 at 10:14 am to cas4t
Didn’t waive the inspection. We didn’t discuss appraisal scenarios so no clue what my agent did there. I really didn’t see this one coming. There is a 5 acre property for sale for $265k. A couple of blocks away. That puts the price per acre at $53k and that’s on a property that hasn’t sold and has been on the market for a month or more.
Posted on 9/10/22 at 10:17 am to WhiskeyThrottle
Is your contract to sell your current home contingent on the sell of the other home going through? You would have specific language in the purchase agreement around this.
Is your purchase of the new home contingent on it meeting appraisal or even your ability to finance the purchase? Both of those should give you an out without losing the in earnest money. The contract typically gives the owner the chance to lower the price or for you to walk away. That money is meant to ensure you are taking the steps to complete the clauses of the contract and reach a close. It also is meant to keep you from locking up multiple properties while you decide which you really want. If the clauses aren’t met you can walk away and keep your money.
Is your purchase of the new home contingent on it meeting appraisal or even your ability to finance the purchase? Both of those should give you an out without losing the in earnest money. The contract typically gives the owner the chance to lower the price or for you to walk away. That money is meant to ensure you are taking the steps to complete the clauses of the contract and reach a close. It also is meant to keep you from locking up multiple properties while you decide which you really want. If the clauses aren’t met you can walk away and keep your money.
Posted on 9/10/22 at 10:21 am to WhiskeyThrottle
Appraisal drives the financing. Hopefully your offer was contingent upon satisfactory financing. Doubt your lender is going to loan above the appraised value.
Posted on 9/10/22 at 10:21 am to WhiskeyThrottle
What does your contract state? What kind of loan are you doing?
Posted on 9/10/22 at 10:24 am to WhiskeyThrottle
Don’t be afraid to walk away and leave the money. It’s better than being immediately upside down.
Explain the situation to your buyer and try to keep this deal on until you find another.
Explain the situation to your buyer and try to keep this deal on until you find another.
Posted on 9/10/22 at 10:29 am to Lsukj
Ultimately, he hasn’t given us enough info to meaningfully answer any of the questions
Posted on 9/10/22 at 10:31 am to fightin tigers
quote:
quote:
but nobody is going to force you to follow through with the sale.
Not 100% true, but there will have to be legal action and a lot more money spent. Most people will not take that route.
Even though the courts CAN force you to go through with the contract they simply are not going to in this situation.
Posted on 9/10/22 at 10:34 am to WhiskeyThrottle
quote:
1- are we obligated to sell our house still if we don’t buy the next house? We haven’t closed.
Yes. Unless it was contingent on you closing on you new house.
Page 1 of 4
Popular
Back to top
Follow TigerDroppings for LSU Football News