FHA Appraisal

[rmathew]

Hello everyone,
I would like to ask a question. If it has already been answered please accept my apology and point me to the link.
I signed a contract to sell my house with a buyer. We both agreed on the price and buyer applied for a FHA loan. The appraiser showed up and told my Realtor that everything was OK and price will come up similar to the selling price. Suddenly I was contacted by the seller's attorney that appraisal came lower than the price. I was expecting some price negotiation and reduction conversation with the buyer but buyer just walked off. No one bother to tell me the appraised value of the house. Now, I am in dilemma to put the house on the market but can't decide on the new price. I want to make sure it will appraise next time I have a buyer. My agent showed me all the properties on the market in my area and recent sales which are all similar to my current price. Her CMA shows that my price and condition of the house was similar to other homes in the area so can't really explain the reason for low appraisal.
My question to you respected folks is how can I get a copy of this appraisal from FHA appraiser? Is seller entitle to a copy of the appraisal? How can go about getting a copy and how long it takes?
I will greatly appreciate your input, thoughts.. Thanks
Best regards,
Roger

 

[Kevin A. Spellman]

You are not entitled to the report. The attorney should not have spoken with you directly if he or she did. All communications should have gone through the agents. A copy of the appraisal should have been requested to verify the attorney’s statement by the agents.

Be prepared next time; go view the listings and the sales you believe could be reliable indicators of value. You should not rely on the agents or an appraiser. There are amateur real estate service providers. Become product knowledgeable. This will assist you in the next price offering or a sales contract.

 

[Ken B]

Was the contract contingent upon the appraised value? Did you receive notice from the lender that the buyer did not qualify for financing due to the appraisal?

If not, you simply had a purchaser walk on you and your agent is an idiot for letting it happen.

The call from your purchaser's attorney (assuming it actually was your purchaser's attorney) was a bluff.

Let me guess, you received a promissory note instead of an earnest money deposit and/or the deposit has already been returned to the purchaser.

 

[rmathew]

Thanks Kevin for your response. Actually I mis-spoke. I was notified by the agent but she did not have the statement from the attorney.
As far as current price is concerned, I did my research and agent's CMa was quite close to my own. I otained the data from the Assessor's office as well as MLS listings that close in past month in my area (2 mile radious). I priced my house accordingly but still it did not satisfy this FHA appriaser. I will ask my agent angain to get a copy of the appraisal and see what it appraised it.
I wonder what would have happend if the buyer had a conventional loan?

 

[rmathew]

Was the contract contingent upon the appraised value? Did you receive notice from the lender that the buyer did not qualify for financing due to the appraisal?

If not, you simply had a purchaser walk on you and your agent is an idiot for letting it happen.

The call from your purchaser's attorney (assuming it actually was your purchaser's attorney) was a bluff.

Let me guess, you received a promissory note instead of an earnest money deposit and/or the deposit has already been returned to the purchaser.

Hi Ken,
I am not sure about that. My attorney called and said their attorney called and said hosue appraised lower and buyer will not go through with this contract. That was it. We had 2k in earnest money and 8k was due after attorney review was done. Things fell apart before then.
It is possible buyer got cold feet. If I were them I would have tried to negociate and get the house for the appraised value. Oh well, I just want to know why and how low it was appraised so I can figure out my next move.

 

[Randolph Kinney]

Hello everyone,
I would like to ask a question. If it has already been answered please accept my apology and point me to the link.
I signed a contract to sell my house with a buyer. We both agreed on the price and buyer applied for a FHA loan. The appraiser showed up and told my Realtor that everything was OK and price will come up similar to the selling price. Suddenly I was contacted by the seller's attorney that appraisal came lower than the price. I was expecting some price negotiation and reduction conversation with the buyer but buyer just walked off. No one bother to tell me the appraised value of the house. Now, I am in dilemma to put the house on the market but can't decide on the new price. I want to make sure it will appraise next time I have a buyer. My agent showed me all the properties on the market in my area and recent sales which are all similar to my current price. Her CMA shows that my price and condition of the house was similar to other homes in the area so can't really explain the reason for low appraisal.
My question to you respected folks is how can I get a copy of this appraisal from FHA appraiser? Is seller entitle to a copy of the appraisal? How can go about getting a copy and how long it takes?
I will greatly appreciate your input, thoughts.. Thanks
Best regards,
Roger

FHA appraisals are good for 6 months and follows the property address. If another buyer comes with FHA financing, the appraisal is already done for the stated value.

You are the seller. You are not entitled to a copy of the appraisal. Maybe your attorney (seller's attorney contacted you) can get a copy of the appraisal although he is not entitled to receive a copy either.

The CMA from your Realtor is a good starting point for offering your house for sale. It does not guarantee that it will sell for that price or appraise for that price.

Can you tell more about how long the property was on market? Any price changes? How far off was the appraised value from your contract sale/list price?

 

[rmathew]

Can you tell more about how long the property was on market? Any price changes? How far off was the appraised value from your contract sale/list price?

The property was on the market for 76 days. We had two price reductions of 20k. I do not know the appraised value since they did not share this information. This is what I am trying to find out.

 

[TJSum]

It seems to me if the contract was contingent on the appraised value, there would only be one way to prove the value, and that is to provide legal documentation of what the results of the appraisal were. Contingences can not be based on word of mouth information.

RK, isn't there an FHA policy regarding the six months time period that allows for another appraisal when there is a different buyer and purchase situation involved? What happens if there are changes to the property between the two different contract offers???

 

[rmathew]

It seems to me if the contract was contingent on the appraised value, there would only be one way to prove the value, and that is to provide legal documentation of what the results of the appraisal were. Contingences can not be based on word of mouth information.

RK, isn't there an FHA policy regarding the six months time period that allows for another appraisal when there is a different buyer and purchase situation involved? What happens if there are changes to the property between the two different contract offers???

This sounds like I, as a seller will be entitle to a copy of this appraisal. How else would I know why buyer is walking away and breaching the contract? The question how do I request this and to whom I make this request.
My attorney?
My agent?
Lender?
FHA?

 

[TJSum]

This sounds like I, as a seller will be entitle to a copy of this appraisal. How else would I know why buyer is walking away and breaching the contract? The question how do I request this and to whom I make this request.
My attorney?
My agent?
Lender?
FHA?

As appraisers we rarely see this end of things. Your agent should know how to proceed if they are experienced as they most likely have run into this situation many times. If the agent can not help, then I would consult your attorney. Proof has to be given in writing, verbal information just does not cut the mustard.