Challenging An Appraisal

Here is the scenario: You have tirelessly worked to negotiate a sales contract between the buyer and seller and have now finally arrived at an agreed upon price. Unless the sales terms are cash, the lender most likely will order the “dreaded” appraisal for the subject property. Then, after a week or so of anxiously waiting,  you get the news of the appraisal results, and as you feared, the opinion of value came in below the contract price. Now, after all this hard work, you have to go back to your client and give them the bad news. This is not an uncommon occurrence. It is estimated that 1 out of every 10 appraisals will come in below the contract price.  When the appraised value is below the contract price the lender typically will not approve mortgages for more than the appraiser’s opinion of value. Now, what do you do? Well, you can try to re-negotiate the purchase price. That would be the easiest option, and of course the buyer is usually open to paying less, but convincing a seller is another story. The next option is to challenge the appraisal. You can do this by contacting the lender or AMC with your evidence for dispute. To get a copy of a sample letter on how to do this,  please use the link below and sign up for Spero Appraisal Services news letter.

http://chicagoappraiser.org/?p=182

 

 

This entry was posted on Wednesday, March 5th, 2014 at 5:44 pm and is filed under general. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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