New Issue - Appraisal Came in Way Too High - Temecula, CA

[Lee Lansford]

...so we wrote in the offer that both Buyer and Seller would agree to buy/sell at the appraised value if it was below the list price of $370,000.

...

One lesson learned: don't place your financial interests in a roll of the dice.

 

[akgolfer]

One lesson learned: don't place your financial interests in a roll of the dice.

Yeah, I knew we were gambling, but with the way the market is here we weighed the risks and decided to go for it as that was the only way they were going to accept our offer and then they also agreed to sell for the appraised price so we liked that as it would not require any renogotions after the appraisal.

I guess I thought that with all the problems before that if anything the appraisal would come in lower than expect, but if it did come in high we had no problem paying the price as long as it look somewhat fair and not more than $10,000-$15,000 high.

Needless to say I didn't know they let rookies do this in this day and age and based on my discussions today I 99% sure the Lender is going to have another appraisal requested (Lender is First California Funding). As for what AMC was used, I will have to look at my credit card and report back.

I'm a professional, so I just assumed that I would get a professional job. And from everyones response and learning more, I believe this Appraiser is just stupid and for all of you other AL's out there she needed to have here Appraisal license retired after only two weeks on the job and maybe only one appraisal.

For those that said they would like to look at it. Can I legally send it to others to review? Do I have to blank out the appraisers name? If anybody knows the legal side of this please let me know and I will read all 26 page of the appraisal as well.

As for the purchase offer we made, I still think it is a great way and hopefully even though the first Appraiser was worthless, I'm hoping the revised one gives us closed to the real amount as we love the house and has a great flat yard for our kids, so we would pay an additional $10,000 above what the real appraisel should be but just not $30,000!

Thanks again and I will keep you updated.

 

[akgolfer]

I am an appraiser in Temecula and very familiar with the area. I am also a real estate agent. I have had lenders that are willing to listen and some that just won't do anything. Feel free to e-mail me if you still have issues. I am curious as to which AMC the appraisal was ordered through? Do you know?

Hey Dani,

Your email link does not work (it says you don't accept emails), so feel free to send me one. As for the AMC, my credit card says "Street Links" and my lender is First California Funding. Since you are in Temecula, how much would you charge me for a desk review or whatever the right words our? I'm an analyzer, so I already have a spreadsheet with the 3 comparables in the report and an additional 5 that are just as good or better, but all 8 seem to come out in the same ballpark (actually the 3 the report included are in the middle) when appropriete adjustments are made. Most the comparable are from Central Park community in Murrieta.

 

[Michigan CG]

.........For those that said they would like to look at it. Can I legally send it to others to review? Do I have to blank out the appraisers name? If anybody knows the legal side of this please let me know and I will read all 26 page of the appraisal as well......

You can send it to whoever you want. You could even post it here. You do not have to blank out anything except the e-mail address and address of the appraiser per forum rules.

 

[Walter Kirk]

If you intended to base your purchase offer on an appraisal you should have chosen an experienced local appraiser and not relied on the low bid appraiser selected by some AMC. Of course you would have been required to pay for the service however as a percentage of the purchase price that amount would be minimal.

 

[akgolfer]

Hello Walter,

Do I have a choice on picking appraisers or is it totally up to my Lender? If I do have pull in this area I would definitely pay extra and get a detailed appraisal done but I thought it was out of my hands.

Thanks again and let me know my options.

 

[Hamlet]

Unfortunately, this is what the market here in Southern Cali. has come to. This happens everyday. Typical buyer is submitting multiple offers as high as possible just to get one accepted in the hopes that once the appraisal comes in they can re negotiate the price. They know ( or should) it's over market value. But they also know that they are competing with multiple offers on each property.

I had a buyer put in an offer for a property listed for 235k. Being an appraiser/agent, based on the comps we offered 240k. Got a call from the listing agent, multiple offers, multiple counters and if we want the property we had to offer better than 270k...What... I told the agent it wouldn't appraise that high. She says " we all know a propertys value is determined by what a buyer is willing to pay" Well then, problem solved, who needs appraisers then?? Property ended up appraising for 242k. Fell out of escrow twice, then sold for 245k.

That's the new thing. Offer whatever it takes to get an acceptance, let the appraiser sort out the value then hope to re negotiate the deal. Now the listing agents are countering with Purchase price to be contracted price regardless of the appraised value in hopes this will stop.

Why is there a bidding war when there are so many available properties? I cannot believe that these RE agents are risking being sued for advising their clients in this way.

 

[Webbed Feet]

Why is there a bidding war when there are so many available properties? I cannot believe that these RE agents are risking being sued for advising their clients in this way.

\

Sister Hamlet,

Post number 10 failed to use the quote function correctly. So when you quoted it, the result was making it appear as if you were quoting something I posted 100% of when it was not.

Could you correct that? Thanks!

Darth Wader

 

[Webbed Feet]

It's all how you prepare the soil, then water the garden.

Hello Walter,

Do I have a choice on picking appraisers or is it totally up to my Lender? If I do have pull in this area I would definitely pay extra and get a detailed appraisal done but I thought it was out of my hands.

Thanks again and let me know my options.

I believe you misunderstood. For a mortgage loan FIRREA requires that a lender select the appraiser with no involvement of the borrower. But for a sales contract contingency satisfaction, the seller and you could have used anyone the two of you agreed upon. There is no law saying the seller and you could not have hired someone else. And, I am sure some very foolish appraiser would have happily served two masters in the process, then probably got themselves sued due to placing themselves in a no-win situation between sellers and buyers with opposing interests. As it is almost a given somebody is going to be very unhappy over the results and try to prove negligence on the part of the appraiser.

But I'm finding we are not a very bright bunch of carrots in the garden as garden vegies go.....

 

[akgolfer]

Temecula Housing Market - You have to play the game!

Why is there a bidding war when there are so many available properties? I cannot believe that these RE agents are risking being sued for advising their clients in this way.

Hello Hamlet,

From a family that has been watching the Temecula Area market trying to get the right house for our family for 8 months, there isn't a lot of properties in our range (3,000-3,600sf; 10,000+sf FLAT yard; Price $300,000-$380,000).

Also, just over the last few month, the "currupt" investors are back that are picking up all the nice house with "cash offers" so the only way for a normal family like our to get our nice house with LARGE lot (in Temecula that is 10,000+sf of FLAT yard) is to get on the hook by being the highest offer and then hoping to negotiate down the road when the appraisal come back way under your offer.

Thus, being a business man I figured I would get a jump on the negotiations and include it in the offer that both parties agreed to the appraised price and the only thing that changed was how much the Seller paid of our closing (i.e. we had them paying $12,000 of our closing if the appraisel was high and if it was low they would only pay $4,000) so this helped hedge our gamble.

Needless to say, the lending company has sent the original appraiser a list of clarifications that she will need to address and hopefully modify appraisal accordingly as well as ordering a new appraisal. So I'm hoping this will get us exactly what we want.

If we had not had this clause in our contract that both parties agreed to the appraisal, the Seller would have already dumped us as we would have told him directly that the appraisel was B.S. and then he would have called up one of the many backup offers of $360k+ and we would have lost out on a perfect house for us.

We weren't playing the "game" the first few months of putting in offers, but here in Temecula if you aren't playing the game you aren't getting the house so we will see how the game ends when the revised appraisal and new appraisal get back next week.