Tag Archives: real estate

Buying, Sell, Uncategorized

Low Appraisal! What are your options?

It is not as simple as you think…

We are what we repeatedly do.

Excellence, then, is not an act, but a habit.

Aristotle
What goes into an Appraisal

Check out my Podcast on “What to do with a Low Appraisal”

If you are thinking that your only options on a low appraisal is to agree or get out, then you would be sadly mistaken! There are a lot of different options that I would consider (and so have my clients) as a win/win on a low appraisal. Let’s consider some scenarios:

  1. Scenario 1-The Appraisal Is Just Not Making Sense! So you look at the details and the bedroom count is wrong, the square footage is wrong, the contract price you agreed to is wrong, the Loan Type is wrong (FHA instead of VA or Conventional), the comps are in an area so far away in another city that you are wondering what the heck is going on with this appraiser!! First of all go through everything in detail and make detailed notes and gather your back up to prove your side. Sometimes, an appraiser is going so fast that they miss a Counter Offer or maybe there is a discrepancy in the listing and the county records on the square footage or they just get your file confused with another. Stay calm and request a reconsideration and document all of your findings without using the words “the appraiser was wrong”. Saying the appraiser was wrong will not get you anywhere and they will read everything you submit. So start by saying that you appreciate the time and effort they have put in for your appraisal, but that you noticed that the Contract Price was for $725,000, however, the Counter Offer #3 notes the Contract Price agreed upon as $750,000. Or that you noticed that the loan was for a FHA loan, however, the Buyer will be getting Conventional financing. You get the idea, the more nuanced you can be, the further it will get you.
  2. Scenario 2-The Renegotiation! So you have looked through the appraisal and either you agree with the appraisal or the time needed to get a reconsideration done isn’t enough to close on time, or you tried the Reconsideration to no avail; Now is time to Renegotiate! Have the Seller Offer to buy down some of the interest and ask the Buyer to put the down payment partially to the under appraisal portion of the home. This option can be done in conjunction with coming down on price as well, but first find out how much buying down the maximum amount of interest will cost and provide in a return on investment. You must know this FIRST before negotiating a further buy down. If an agent tells you otherwise, ask them about their previous experience doing this, my guess is never or they wouldn’t try to get you down on price first.
  3. Scenario 3-Commissionectimy! So sometimes a buyer is only putting the minimum amount down and there isn’t anything that can be done to lower the interest. In addition this works on smaller appraiser issues like $5,000 or so. What I do is tell the Buyer’s agent that I am willing to match them dollar for dollar in reducing the commission to get the deal done, then depending if there is a short fall ask the Seller for the difference. A Seller will be impressed that the two agents are already doing their part to make the deal happen.

So in summary there are a lot of options and they are NOT mutually exclusive. I have done all of these on just one home in some cases and got the deal done! Sometimes, only 1 or 2 of the options get it done, and sometimes both parties have to part ways…but before you do that give it your best shot to get past a low appraisal!!

Buying, Uncategorized

Is it a Buyer’s Market? Not Quite…

We appear to be in a Balanced Market!

Never Judge Your Clarity by Someone Else’s Response

Starting Over the TV Series

Check out my Podcast on “Balanced Real Estate Market! What is that?”

Right now we are all hearing that buying a home just isn’t possible, interest is too high, prices are too high or too low, the economy is bad, who knows what will happen in the future…So there may be some truth to all of these statements, but there are work arounds!

So when interest rates go up, lending tends to not be as tight, it’s the old supply and demand. Also, Seller’s are more apt to help buy down the interest in a Balanced Market! This is an awesome trend that is going on right now. Talk to your Lender about this one before you put in an offer to see what the maximum amount a Seller can contribute to you!

So prices being too high or too low, may not really be an issue if you are selling a home and buying a new one. In addition, Seller’s are more inclined to accept your contingent offer in a Balanced Market, giving you time to get your current home sold. But, be prepared to be a Seller who knows how to sweeten the pot for the right Buyer.

So the economy is bad and who knows what will happen in the future…so some day prices will go back up and the economy will get better. History tells us that there are ups and downs in real estate, but except in very rare cases is a home purchase deemed to be worthless, even if it’s only worth the land due to some unforeseen condemnation.

So if you are in the market to change your home, don’t be afraid, there are deals to be had and Seller’s are more reasonable than they have been in the last couple of years.

Watch this short Video on the New Balanced Market!
Buying, Sell, Uncategorized

Ideal Agent

What makes the Ideal Agent? Money or Attributes?

“Never do or don’t do anything because of FEAR”

Author 7th Heaven Episode Unknown
Question everything you want to know from an Agent!
Click the link above and Checkout my Podcast!!

So when you are considering an Agent to help you in your next real estate transaction, what do you think is important to you? Write those traits down and then put them in order of importance. When you write down your order of importance, go from top to bottom and ask this question, “If this was the only attribute that they had would that be ok?” Probably not, but let’s put them in a group. Then look at the list again from bottom to top and ask this next question, “If this was the only attribute that they did not have would that be ok?” This will obviously garner a different result. You will soon find what is truly important to you!

What do I think is the top attribute? For me, I think communication a) Timing–maybe you have a job and you can only talk after 7pm does your agent understand that? b) Method–So you are super busy and you prefer texting but your Agent wants to email all the time and you daily get hundreds of emails so you don’t see it. c) Content–Is the information you need done concisely or is there a story every time.