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$100,000+ diff. between 2 year old appraisal & current v

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BobBush

Thread Starter
Freshman Member
Joined
Jul 21, 2002
I have an appraisal from my lender whom I refinanced with 2+ years ago that shows a value of $275.000. There has been no major change in the housing market and if anything it is a urban growth bedroom community. We refied for 75% to value. I have 3 different real estate agencies who have done 'market appraisals' with comparables. They have come back with a value in the area of $169,000-$189,000. This appraisal was done in 2000. In 1998 I have a appraisal for $200,000. A new shop was added for approximately $25,000. My question is, have my lenders appraisals been over inflated and if so is there any recourse and if so against whom? I didn't realize that you could be upside down on a house. I owe $198,000. Any input would be greatly appreciated. Thank You in advance
 

Ross (CO)

Senior Member
Joined
Jan 17, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
Bob. The answers to your three posed questions seem to be...could be, yes, and depends. Upon reading your posting a few times I sense an inability to place all your comments about appraisals and the realtors' market "appraisals" in a proper time sequence. Only you know best the reality of your home within its market area and how well homes sell and for what current prices and following what possible trends of appreciation, depreciation or present stability. If you feel you may now be "upside down" on your mortgage and that is from the one where the value came in at $275,000, then at some moment close to securing that loan you just might have asked yourself...."could my house really sell for $275K tomorrow" ? If your neighbor's house is VERY much like yours and he bought for maybe $225K one month before you re-fi'd, then some doubts may have crept in worthy of your being sure about the value you were given for that re-fi. Imagine the cash proceeds you (might have) reaped in such a cash-out re-fi and now in hindsight think of how your personal investment of another $350 for an independant appraisal might have served you well to be certain about the "whole deal" before you signed on the line. You were the customer which means you were the boss. The loan time lock stuff may just be extra fluff to get people to move fast and decide fast. Being granted a loan above-and-beyond what is realistic occurs all the time. Many homeowners get drawn in to the hype of equity borrowing and all the great things one can do with this windfall of cash your home has "made" for you. Unfortunately there are many folks who have re-fi'd too deeply and have tapped all the cash reserve benefit from the home which was initially purchased to be the nest egg of future security, i.e like selling 5 to 10 years later and walking with $100K to another house or another city or another need in life's course. I sure hope that you are NOT upside down and can get this situation cleared up easily.
 

wyecoyote

Senior Member
Joined
Jan 15, 2002
Professional Status
Gvmt Agency, FNMA, HUD, VA etc.
State
Washington
Bob,

I agree with Ross on this one on all three answers. The only advice that I would give is to spend the extra money if you are truly looking to sell and have another appraiser come out. Don't tell the appraiser anything about the past appraisals or what you think the house is worth let him/her do the appraisal completly independent. If they ask what you think the house is worth find someone else or tell them to do there job and tell you what it is worth. Explain that you are looking to sell if that is truly the case. Also don't higher the same appraisers. You might want to inquire on this site and people here probably know someone that they would recomend. See what that apprasier comes up with. If there is a significant difference then the old appraisals may have been coerced or pressured to come up with a value that made the loan work. You should have been able to recoginise it at the time as Ross points out. This could simply be a case where the agents in your area don't have a clue and your house has significant upgrades/quality/condition better than most in your area or that the agents are getting inacurate information.

If you are simply looking for someone to blame and sue contact a lawyer first and see what your options are. For lawsuits a lawyer may know an apprasier in your area that does litigation appraisal work.

Ryan
 

xmrdfghap

Senior Member
Joined
Jan 15, 2002
Professional Status
General Public
State
Florida
<span style='color:brown'>Bob, hire an independent appraiser. If you have any doubts about any of the appraisals you have in hand, get another appraiser to review them. It is going to cost you, but it will be less than a thousand dollars, and the retainer for your attorney will be at least that much.

Once you have all the facts, including reviews, in hand, go to your attorney. As appraisers we do not like the idea of taking another appraiser to court, but we are ALL glad to see numbers hitters eliminated from the profession.

If as you suspect you have been the victim of preditory lending practices, which, combined with a "bad" appraisal have made you upside down on your property, you should have a case of fraud. The states vary in their licensing and oversight of appraisers, loan officers, and underwriters, so your local attorney's will have the final say in your case.....but by all means, if you are the victim of such a fraud, do your best to put those guys out of business.

</span>
 

David S. Roberson

Senior Member
Gold Supporting Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Tennessee
Sounds to me like Mr. Lender & his cohort got old BobBush! Made a good commision on the loan, too, I bet! Happens all the time here. Heck, it happens everywhere. I am truly sick of this kind of thing.
 

graindart

Junior Member
Joined
Jan 20, 2002
Professional Status
Certified Residential Appraiser
State
Montana
I don't want to get into this very far, as it's already been discussed in past threads. However, I still say that there are far too many homeowners that are claiming victim and looking for someone to blame instead of just looking in the mirror, sucking it up, and dealing with their own mistakes.

My disclaimer - I'm in no way supportive of bad / fraudulent appraisers, which should go without saying.

When they need or want to borrow money, most homeowners don't care in the least how much their home is really worth. All they want is the money. If an appraiser fails to meet the magic number needed to complete the loan, the average homeowner doesn't sit there and think "Hmmm, it's a good thing that I now know what my home is actually worth, and now I know not to try to get a loan. Thank you mister honest appraiser!" ------ No, quite the opposite, they call up the appraiser and either beg and plead for a higher value to pop out of thin air, threaten to sue or turn the appraiser in to some governing body (usually the better business bureau), or just go try to find a different appraiser that can "do the appraisal right" and magically come up with the correct number.

This same homeowner a couple of years later can't pay their bills or is in upside down on their home. They're still living in the same home that they bought for $100,000 and is worth $120,000; they owe $200,000 and don't have a clue where the money went and want to blame that same number hitting appraiser that just a couple of years ago was the guy who obviously "knew how to do the appraisal right."

Let me close by agreeing with some of the other statements expressed: If you're a homeowner and actually care to find out what your home is actually worth, order an appraisal from a licensed/certified real estate appraiser, and don't mention any suggested values.

PS - pay for your appraisal at the door, so when you find out that your house hasn't appreciated 300% in 3 years the honest appraiser doesn't have to put up with your temper tantrum!
 

Terrel L. Shields

Elite Member
Gold Supporting Member
Joined
May 2, 2002
Professional Status
Certified General Appraiser
State
Arkansas
I have seen so many people who inflate appraisals even without being asked that I would hesitate to recommend the sole criteria for choosing an appraiser be certification.


I would go to a regular bank, middle age loan officer that does commercial loans (not mortgage lender) and tell them you need a real honest value for the property and who do you recommend to do the appraisal that cannot be swayed.

I would explain to the appraiser you need a bona fide value not inflated or overly conservative (i.e.-not distressed or liquidation pricing) and a reasonable discussion of the market and you want it as a narrative report, not a URAR lending form.
 
A

Anonymous

Guest
So far in this thread, the word appraisal has been used many times. My question for you Bob is: Do you have copies of all of these appraisals? If they are really appraisals you are entitled to a copies. First, start with your lender. Get a copy of that appraisal. I wonder if it is really an appraisal or one of their back room computer jobs.

If it is an appraisal, I would agree with an earlier post. Did you reallt believe that your home was worth that much? You must have some idea of what similar homes are selling for in your area. Did you just turn your back on reality because it got you the money you wanted? See Bob, based on most of the posts on this site, My opinion is that the vast majority of the appraisers here are ones your lender would not work with. Why? Because your lender would not be gauranteed the number they want to make the deal work. If you read posts on this site, you will find that most of us are honest, hard working people, but most importantly, we are ethical. You would have been fuming mad at most of us had we done your original appraisal, assuming the current range of $164,000- $185,000 is correct. You wouldnt have got your money. You would have come on here then posting questions asking how to sue us because you didnt get your money. I for one am grateful to see this coming around to bite the people who have been feeding this monster.
 

Mike Garrett RAA

Elite Member
Gold Supporting Member
Joined
Jan 14, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
If all things are exactly as you stated...get an independant appraisal from a reputable company in your local market. If the value was grossly inflated, sue the lender and the appraiser. Hopefully you will be able to rid the system of some slime.
 
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