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Residential Real Estate Deal Getting Screwed Up By Appraisal - So Says The Lender

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RCJeffersonCoWA

Freshman Member
Joined
Oct 23, 2017
Professional Status
General Public
State
Washington
Hello,
Wondering if this makes sense to professionals in this field. I am trying to figure out if the lender is playing games to make more money. Wondering whether to start the whole process over with another lender, or just try to see this through. If the appraisal really is what is holding things up, another lender will not help.

Background Info:
Residential Property in Jefferson County, Washington State
Comps probably are difficult to come by, large house acreage with hardwood floors, granite, marble, etc.. All top of the line building materials. Great views, very nice location, but not in a highly sought after area (just far from any metro area, there are many Million dollar houses around, but most are waterfront).

Original closing date was something like end of November. Loan officer tells us that an appraiser "accepted the job" (I guess they just put the job out there and appraisers bid on it if they want it?) but that the appraiser wanted $1,500 (she said she quoted $1,000) and that the due date would be right around what was supposed to be the closing date (about 5 weeks from when she says the job was accepted). We said the price was fine, but any way to get it done sooner? She said just decline this appraisal and see if the next terms are better. We say OK. A few days later she says no other appraisers accepting, we should just use the original one but now it will be 6 weeks to get an appraisal back, and comps will be limited.

This seems like a very long time to get an appraisal back. Is it? Again, I am not concerned about the cost, just want to get this thing closed in a reasonable time frame. Looking on this site there seem to be a lot of appraisal companies in Jefferson County.

Does this sequence of events regarding appraisal sound reasonable? Can banks just call an appraiser they want to use, or is it really a black box where they somehow anonymously request an appraisal and wait to see what happens? I really feel that the agreed price for this house is extremely reasonable, is the lack of a large volume of comps really a big issue when a house is objectively priced below what it could be built for?

FWIW the agreed sale price is approximately 75% of the current appraised value (that the county is using for taxes).

Thanks in advance for any insight
 

Tom Woolford

Elite Member
Joined
Nov 20, 2005
Professional Status
Certified Residential Appraiser
State
Florida
Appraisers operate a business. In my office its first in first out. Looks like the major parties in this deal went looking for Mr. Cheap and Fast. Now it's the original Appraisers fault that his business didn't get put on hold waiting for the offer to come back to him. Makes perfect sense.
 

RCJeffersonCoWA

Freshman Member
Joined
Oct 23, 2017
Professional Status
General Public
State
Washington
Appraisers operate a business. In my office its first in first out. Looks like the major parties in this deal went looking for Mr. Cheap and Fast. Now it's the original Appraisers fault that his business didn't get put on hold waiting for the offer to come back to him. Makes perfect sense.

I am just looking for insight here, not trying to insult anyone. As I said I suspect the lender as being the issue.

So can I infer from your reply that you think $1,500 is cheap and 5 weeks is fast for an appraisal? If that is the case there is no reason for me to try a different lender (as what they are telling me is probably correct).

Thank you for your reply.
 

gregb

Elite Member
Joined
Sep 3, 2011
Professional Status
Certified General Appraiser
State
California
Your lender is likely using what is called an AMC, or Appraisal Management Company, which takes a portion of the fee for managing the appraisal process for the lender. You live in a state which has recently experienced longer turn times than most states, we call your state a COW state (Colorado, Oregon and Washington). Some appraisers will not work for an AMC, for a variety of reasons, including the low fee they typically pay to the appraiser. My bet is that if you were to take your loan to a bank that directly orders the appraisal (does not use an AMC) you would be well satisfied as to the overall fee paid and the service provided by a directly engaged appraiser.
 

George Hatch

Elite Member
Gold Supporting Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
California
The market for services responds to the laws of supply and demand. If appraisers are so busy that it takes 5 weeks to get one back then that indicates to a considerable degree of scarcity, so it really wouldn't come as a surprise to see a fee that's commensurate with that scarcity. After all, those appraisers (and I'm sure that company contacted several of them) apparently have alternatives. If you won't pay them what they want they apparently think they'll find others who will.

I can assure you that when the shoe is on the other foot and there's not enough work to go around that those fees drop like a rock as the appraisers are competing with each other. So this market volatility is a knife that cuts in both directions.
 

Elliott

Elite Member
Joined
Apr 23, 2002
Professional Status
Certified General Appraiser
State
Oregon
How many acres, how many square feet of living area, what do you think the estimated value is ? How far to the closest comparable sale?
 

RCJeffersonCoWA

Freshman Member
Joined
Oct 23, 2017
Professional Status
General Public
State
Washington
The market for services responds to the laws of supply and demand. If appraisers are so busy that it takes 5 weeks to get one back then that indicates to a considerable degree of scarcity, so it really wouldn't come as a surprise to see a fee that's commensurate with that scarcity. After all, those appraisers (and I'm sure that company contacted several of them) apparently have alternatives. If you won't pay them what they want they apparently think they'll find others who will.

I can assure you that when the shoe is on the other foot and there's not enough work to go around that those fees drop like a rock as the appraisers are competing with each other. So this market volatility is a knife that cuts in both directions.

It seems I somehow gave the impression I was complaining about the fee. I am simply trying to figure out if it can be done in a more timely manner. Want to get closed. Don't care about 1500$
 

AMF13

Elite Member
Joined
Jan 24, 2002
Professional Status
Certified Residential Appraiser
State
California
Sounds like you are getting screwed up by an AMC, not the appraiser. :shrug:

More timely may not be possible. Don't tell the sharks you don't care about $1500.
Or. PM me your address, I will send you a sase for it. :peace:
 

DTB

Elite Member
Joined
Jun 11, 2004
Professional Status
Certified Residential Appraiser
State
Illinois
Sounds like you are getting screwed up by an AMC, not the appraiser. :shrug:

More timely may not be possible. Don't tell the sharks you don't care about $1500.
Or. PM me your address, I will send you a sase for it. :peace:

More timely is ALWAYS possible. The question is how much will the expediting fee be?
 
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