My question to the members is about a property I own that appears to have been grossly overvalued.
The property is 5 acres of land with a newly constructed 4000sf home, 1400sf 3 bay garage and a 4000sf heated and insulated commercial shop. The property in the right location would be worth upwards of 2 million but in this case it is in an isolated rural location in NE Montana near the Canadian Border where the above average home sale prices are in the $4000K area. This is surrounded by farmland.
I purchased the property in 2000 for $25,000 and at the time it had a 1400sf basement only house with a roof on it that was only 3ft above grade. I started a business there which was manufacturing items that I sold on the internet. Over the years the property grew and in 2008 I built the steel shop and in 2012 I took a 150K construction loan with a local bank to build the house on top of the existing basement. The bank ordered an appraisal for purposes of the loan which valued the property at 280K AFTER the house was built.
With the house finished in mid 2014 and a cost overrun of 50K, I took the property to Quicken Loans for a 30year conventional loan. They ordered an appraisal and could not find an appraiser to do it. They asked me if I knew anyone and after asking around was given the name of an appraisal service in Plentywood MT, some 100 miles to the east of us. I passed the name on to quicken and they hired them.
The appraised value came in at $650K which was very surprising to me but I said terrific! I would use the opportunity to pay off the existing construction loan and some other outstanding debts so I took on 400K with the thought that I still had 250K of equity.
A year later my common law husband walked out on me causing my business to all but fail and leaving me sitting high and dry in the middle of nowhere with a large debt to pay. I decided to sell the property and had trouble finding a local realtor to take it on at the appraised value. I then found a sympathetic realtor who marketed it for a year locally and over the internet, starting out at $500K and eventually down as low as $350k which was below what I owed. In all this time he had only 2 inquiries and 1 showing. None of those were financially qualified.
In Oct 2016, I walked away and moved to Florida. I continued to pay the Mortgage till January of 2017 but then had to stop due to financial hardship. Quicken offered me a deed in lieu with a 1099 hit for the difference which could have been substantial. I looked at bankruptcy but since my business was still bringing in the majority of my income I would have had to lose that in bankruptcy. So, in June 2017 I made a deal to do a mortgage modification and move back to the property.
Last week I paid for a reappraisal from the same appraiser that did the appraisal for the bank in 2011 and she said to me that based on the location, she does not understand where his number came in at $650K. She didn't think it will come in at 450K. Still waiting for the result. The Tax assessed value is $385K.
So... what now? Can I sue someone for getting me in over my head or am I just on my own? I appreciate any advice I can get. Thanks for your time.
The property is 5 acres of land with a newly constructed 4000sf home, 1400sf 3 bay garage and a 4000sf heated and insulated commercial shop. The property in the right location would be worth upwards of 2 million but in this case it is in an isolated rural location in NE Montana near the Canadian Border where the above average home sale prices are in the $4000K area. This is surrounded by farmland.
I purchased the property in 2000 for $25,000 and at the time it had a 1400sf basement only house with a roof on it that was only 3ft above grade. I started a business there which was manufacturing items that I sold on the internet. Over the years the property grew and in 2008 I built the steel shop and in 2012 I took a 150K construction loan with a local bank to build the house on top of the existing basement. The bank ordered an appraisal for purposes of the loan which valued the property at 280K AFTER the house was built.
With the house finished in mid 2014 and a cost overrun of 50K, I took the property to Quicken Loans for a 30year conventional loan. They ordered an appraisal and could not find an appraiser to do it. They asked me if I knew anyone and after asking around was given the name of an appraisal service in Plentywood MT, some 100 miles to the east of us. I passed the name on to quicken and they hired them.
The appraised value came in at $650K which was very surprising to me but I said terrific! I would use the opportunity to pay off the existing construction loan and some other outstanding debts so I took on 400K with the thought that I still had 250K of equity.
A year later my common law husband walked out on me causing my business to all but fail and leaving me sitting high and dry in the middle of nowhere with a large debt to pay. I decided to sell the property and had trouble finding a local realtor to take it on at the appraised value. I then found a sympathetic realtor who marketed it for a year locally and over the internet, starting out at $500K and eventually down as low as $350k which was below what I owed. In all this time he had only 2 inquiries and 1 showing. None of those were financially qualified.
In Oct 2016, I walked away and moved to Florida. I continued to pay the Mortgage till January of 2017 but then had to stop due to financial hardship. Quicken offered me a deed in lieu with a 1099 hit for the difference which could have been substantial. I looked at bankruptcy but since my business was still bringing in the majority of my income I would have had to lose that in bankruptcy. So, in June 2017 I made a deal to do a mortgage modification and move back to the property.
Last week I paid for a reappraisal from the same appraiser that did the appraisal for the bank in 2011 and she said to me that based on the location, she does not understand where his number came in at $650K. She didn't think it will come in at 450K. Still waiting for the result. The Tax assessed value is $385K.
So... what now? Can I sue someone for getting me in over my head or am I just on my own? I appreciate any advice I can get. Thanks for your time.
