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Low Appraisal. Please Help!

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SurfNsand001

Freshman Member
Joined
Jul 10, 2016
Professional Status
General Public
State
Pennsylvania
Long story short... we are looking to buy my in-law's house. we had an appraisal done 1 year ago and they had their own appraisal 2 months ago.. $115,000 difference. Our lender's appraisal came back yesterday... $150,000 difference between my in-law's appraisal and the bank's. Our agreed upon price was a split of the original two. Now with the lender's appraisal we are still over $100 k apart. One or more of the appraisers didn't do their job appropriately. How can there be this much of a difference? How can we contest or challenge the lender's appraisal? This is an obvious deal breaker for all of us and the bank. Comp adjustments are all over the place... one adjusts 30 k for a finished basement, one 8 k. The property is on 11 acres... one adjusts 17,500 k per acre the other 5 k per acre? I can see where the numbers are off but why? How can one do "land" comparables then add this comparable amount (17,500 k) per acre to the adjustment when the other two did not do land comparables but added 5-8 k per acre adjustment? One looks at comparable homes on less than 2 acres but similar size, age etc and the others look at homes of similar size, acreage but almost double the age. Is a 4th appraisal going to be any different? Any advice? Thanks.
 

Howard Klahr

Senior Member
Joined
Oct 4, 2004
Professional Status
Certified General Appraiser
State
Florida
There are basically two ways to address your issue
1) Hire another appraiser to perform appraisal reviews of the reports that you possess to help you figure out the specific issues
2) Go to a different bank which will then obtain yet another appraisal.
 

A K

Elite Member
Joined
Jul 31, 2013
Professional Status
Certified Residential Appraiser
State
Maryland
How big of a difference is a $150k difference? Is it like at $500k property or is it like a $2 million dollar property?
 

Eli

Elite Member
Joined
May 12, 2007
Professional Status
Certified General Appraiser
State
Tennessee
Take Howard's advice and hire a professionalIt will boil down to recognized techniques and methods of appraisal practice. You don't know.
 

Eli

Elite Member
Joined
May 12, 2007
Professional Status
Certified General Appraiser
State
Tennessee
Have you showed the appraisals to your bank?
 

SurfNsand001

Freshman Member
Joined
Jul 10, 2016
Professional Status
General Public
State
Pennsylvania
Well I guess it depends on the appraisal... the property should be priced in the 750-800 k range based on similar MLS listings.
 

A K

Elite Member
Joined
Jul 31, 2013
Professional Status
Certified Residential Appraiser
State
Maryland
One of the three reports has to be more convincing or better explained than the others.
 

Eli

Elite Member
Joined
May 12, 2007
Professional Status
Certified General Appraiser
State
Tennessee
Well I guess it depends on the appraisal... the property should be priced in the 750-800 k range based on similar MLS listings.

Show all the appraisals to your bank 1st. There are just too many factors that could be involved for us to give you an opinion without doing a standard review of the appraisals. Like effective dates and whether or not recognized techniques and methods of appraisal practice were utilized. Your bank likely has somebody that can help you or you need to do like Howard said.
 
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SurfNsand001

Freshman Member
Joined
Jul 10, 2016
Professional Status
General Public
State
Pennsylvania
I haven't spoken to our bank yet since I was emailed the appraisal late yesterday. I was planning on sending her the other two reports on Monday. Maybe they could do a review of all three... I just don't have much hope that they will reconsider.
 

SurfNsand001

Freshman Member
Joined
Jul 10, 2016
Professional Status
General Public
State
Pennsylvania
In your professional opinion, how often are just land comparables added to a standard property appraisal? Only one appraiser did just that which inflated his appraisal 120-150 k over the others. I can see the obvious but no one has been able to explain why this was done or if it is even legitimate.
 
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