Applicant/Buyer had to write an appraised value letter

[Kevin A. Spellman]

The lender/investor would not close the loan until the buyer wrote a letter stating they understood the appraised value does not support the sales price.

The buyer signed a sales agreement without a financial contingency and was offered a lower mortgage amount. This was a mortgage broker assignment. I like the idea the lender made the applicant/buyer write a letter about the understanding of the appraised value.

 

[Randolph Kinney]

While that letter may do something for the lender, I don't see any protection for the appraiser.

 

[Kevin A. Spellman]

The old way of business, a second appraisal would have been done and my report would be thrown away. I guess this is a new business practice by the lender. I do like it.

 

[Karl]

This is going to be more common I hope. Cause I got a lady here in AZ City that feels she doesn't have to pay her mortgage cause the home has reduced in value. The lenders lawyer shows her in the contract that she'd pay regardless of value. Here is the clincher, it was purchased as a INVESTMENT home, & the contract says that they can attach just about everything these people own or are thinking of owning.

I think anyone that walks from an "investment" home should be put in jail.

 

[Marcia Langley]

The lender/investor would not close the loan until the buyer wrote a letter stating they understood the appraised value does not support the sales price.

The buyer signed a sales agreement without a financial contingency and was offered a lower mortgage amount. This was a mortgage broker assignment. I like the idea the lender made the applicant/buyer write a letter about the understanding of the appraised value.

Do I understand correctly that the contract price still stands and the buyer is simply making a bigger downpayment and getting a smaller mortgage?

What buyer in his right mind would do that in the current market? Failure to get financing would have gotten him out of the contract if the seller declined to renegotiate the price.

 

[Tudor]

Maybe the seller is kicking back some cash.

 

[Kevin A. Spellman]

Beach front neighborhood on Buzzards Bay an area off the Atlantic Ocean, it will be a second home for the buyer. I came in $80,000 under the sales price.

 

[Mountain Man]

I think anyone that walks from an "investment" home should be put in jail.

In a way, they are. Financially, it would be a decade before any bank will touch them again. I've seen a few "Investors" go down who thought hiding behind an LLC would help them. It is the the same effect of revoking your license... you'd be flat out of business and looking for a job as a fork lift driver at Lowes. It has hit the fan and banks are no longer lending to any investor who doesn't have cold hard cash.

 

[msdmckee]

In a way, they are. Financially, it would be a decade before any bank will touch them again. I've seen a few "Investors" go down who thought hiding behind an LLC would help them. It is the the same effect of revoking your license... you'd be flat out of business and looking for a job as a fork lift driver at Lowes. It has hit the fan and banks are no longer lending to any investor who doesn't have cold hard cash.

How about an investor who set them selves up in a trust after they bought an "investor" house? (House was bought in 2004, trust set up in 2006) Can they hide behind a trust?

 

[Mike Boyd]

How about an investor who set them selves up in a trust after they bought an "investor" house? (House was bought in 2004, trust set up in 2006) Can they hide behind a trust?

No, they cannot hide behind a trust.