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I recently tried to refinance my home loan. The current lender refused to re-negotiate my interest rate so I checked around. I found a good rate but the lender required upfront fees which I was told would be refundable at closing. Two years ago my property appraised at 250k and i owe 189k. I figured I could swing this deal. Well my recent appraisal came in at 159k. Local mortgage brokers said property values in my area had declined by not more then 21%. I checked the appraisal and found only one property used in the comps was from my neighborhood. I know property values have depreciated but I think I've been scammed by both the appraise and lender.
Any thoughts or commentary would be appreciated.

jameshogg · Posted: Thu Jul 02, 2009 8:39 pm Post subject:

Hi buckeye,

Property values have gone down badly in the recent times which has resulted in upside down mortgages. Most of the borrowers are unable to refinance their property just because their property value is lower than the mortgage they owe.

In your situation, if you feel that you've been scammed by your appraiser and lender, you can contact any other appraiser and check out the value of the property. If you find that your property value is more than the appraised value, you can contact any other lender and look out for a refinance.

Thanks

Jimmymackin · Joined: 17 Aug 2009 Posts: 66 0.65 Dollars($)

Jake,

The lender has a lot more to gain to fund your loan than they do for a few hundred dollars that being collected by the appraiser in the first place...Use free tools like Zillow.com or Realquest.com to find out what other homes have been selling for.

You can also contact a local appraiser to ask he/she about the area, they may be willing to provide insight.

Best of Luck

CArefinance · Joined: 25 Aug 2009 Posts: 2 1.91 Dollars($)

Hey Buckeye Jake,

Even though we are in a declining market 21% is a huge drop, but its happening all across the states. First thing I would do is, ask for a copy of the appraisal in which you paid for. Take look at the comparable sells to see if they are using accurate sales in your area. I know that appraisers and lenders are being very tight on value due to the market.
Also, check to see what typr of loan that you have. You maybe be able to do a streamline refinance. And you might want to check with another lender and or appraiser to get a second opinion if you feel that your are being scammed. Dont let one appraisal stop your quest for a refinance.

Guest

You have to understand that the 21 percent decline is what may have been the average decline for the market, that does not mean yours will not drop more or less than the average. An average is just an average, it is the sum of all, that you divide by the total and get an average. There are variances relative to price range within the same area. Two homes next door to each other, one might decline 10 percent, the other 30 percent and it does happen, so what is the average of the two, could it be 20 percent. Hmmm, now that would be unusual but it does happen, say one home is 4,000 square feet and built three years ago and the other 128 years old and 1,200 square feet, the odds are they are different, very different buyers and thus different sub-markets right next door to each other.

Guest

I have sort of a similar issue. I have one of the nicer homes in my neighborhood and dumped a ton of $$ into a pool/landscaping 2 years ago. We plan to stay and have excellent credit. However, we cannot get a comp in our neighborhood to support an 80/20 loan. The houses that are selling aren't even close to as large, have the size of lot we do, nor do they have $100k in a pool/landscaping. We need help going from a 30yr 5.65% fixed to a 15 year fixed loan. Any ideas??

Guest

If proper comps are not available, then it won't be possible for you to get a proper appraisal of the property. Thus, it would be difficult for you to get a refinance.

Guest

We again are refinancing our home. Knowing the appraisal gimmicks, we paid down extra so we would be sure to fall in the range so we could get the better rate. I just found out we have to pay additional money down now to fall within a 75% range or pay points. It is not much but I wanted to refinance with no closing costs. Our home was compared with those that had less upgrades, our additional (beyond builder) upgrades were not considered, and we were compared with pond view not pond front. I think the appraisers and the banks are part of the problem with the housing market and they need to be investigated. We are going ahead with the refinance but I am going to see what I can do about the way homes are being appraised.

adonis · Posted: Tue Feb 07, 2012 11:22 pm Post subject:

Welcome MaryP,

Paying points to get a lower rate is a well known option and as far as I know, a lot of people have benefited from it. In case you don't want to pay the extra costs, you can try refinancing your mortgage with some other lenders.

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