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Agent disclosure

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Will Trueheart

Sophomore Member
Joined
Feb 18, 2003
Does the real estate agent have a "duty" to disclose that an appraisal was done on the property for a prior contract that did not appraise at the "sales price"?

It would seem to me that state laws (which vary) allow real estate agents to set listing prices but at what point does the appraiser's value superceed the agent's?

Seems to be that a lot of problems could be solved by requiring full disclosure especially if the seller, agent, buyer, and mortgage company were required to disclose appraised values.
 
W

walt kirk

Guest
That might cause more problems than it solves. Firstly, the appraisal is confidential. Secondly, the appraisal is the property of the person or company that ordered it. Thirdly, the market could have changed in the time since the appraisal was completed. Fourthly, the appraisal could have been prepared by a number hitter or by an AVM and not be worth the paper it's printed on.
 

Will Trueheart

Sophomore Member
Joined
Feb 18, 2003
I respectfully disagree. If the appraisal was done correctly, what's to hide? I think too often a good first appraisal is trashed so that a number hitter can be called in to get the "sales price".

Even if the appraisal report isn't made "public" doesn't the RE agent have a responsibility to disclose to potential buyers? What fact is more significant than the property's value?

Seems to me that there shouldn't be anything to hide.
 

Mountain Man

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Georgia
The sales agent, working for the seller, is an advocate for the SELLER. They only disclose material facts about the house. Disclosing a past appraisal would be a violation of the client/agent relationship. The buyer is a customer, not the client.
 

Mike Garrett RAA

Elite Member
Gold Supporting Member
Joined
Jan 14, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
Exactly M. Leggett. Will, your question was "does an agent have a duty to disclose an appraisal"....the answer still remains NO. Now, if you ask "should a real estate agent disclose"....the answer could be "maybe".
 

Will Trueheart

Sophomore Member
Joined
Feb 18, 2003
I've always been told that an FHA appraisal stays with a property for six months, so that if the appraisal was below the asking price (or sales contract price) then the property couldn't be financed for more than the appraisal reguardless of the borrower. If this is the case, why doesn't the same type of standard apply with a conventional loan?
 

Mountain Man

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Georgia
Maybe Pam, but that is their job.
It's my job to protect MY client to be sure that they don't lend on it. :wink:
 

Will Trueheart

Sophomore Member
Joined
Feb 18, 2003
M. Leggett,

I realize that the agent has a duty to their client and that part of their job is to "estimate" a listing price. My question is bascially why doesn't the appraiser's opinion of value supersede the agent's?

While the goal of the agent is to sell their clients home for the best price possible, somewhere in their rules in ethics that are suppose to protect the public from harm just as appraisers are suppose to.
 
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