Posted on: 16th Jan, 2008 04:48 am
I’ll be buying home from landlord for $1, 50,000 and have a few questions:
I agreed to purchase the home for $1, 50,000 but the city tax assessor gave a value worth $1, 52,000 whereas the appraiser gave us a "drive by" appraisal of $1, 45,000.
I would like to know who pays for the title work if it's already done and then the deal doesn't work out?
And who will pay for the appraisal in case the deal doesn't work through?
Will the company not offer the loan if the house doesn't appraise for a loan offer of $1,20,000 as I would be paying 20% down payment? Should I again go for another appraisal in case the house would then appraise for $1,20,000. what are the possible loan options that I can look for?
I agreed to purchase the home for $1, 50,000 but the city tax assessor gave a value worth $1, 52,000 whereas the appraiser gave us a "drive by" appraisal of $1, 45,000.
I would like to know who pays for the title work if it's already done and then the deal doesn't work out?
And who will pay for the appraisal in case the deal doesn't work through?
Will the company not offer the loan if the house doesn't appraise for a loan offer of $1,20,000 as I would be paying 20% down payment? Should I again go for another appraisal in case the house would then appraise for $1,20,000. what are the possible loan options that I can look for?
You shouldn't be ordering an appraisal......That is the job of the lender....and a drive by appraisal may not give you the value you need....The lender will allow you to purchase the home for whatever you want but the loan will be based on the appraised value...ie if you are putting down 20% you may need to bring more money than that to closing.
why a driveby appraisal? what is wrong with the house?
as far as who pays - typically its the buyer but it can be anyone really depending on agreement.
you could get a normal appraisal (unless there was a reason for it to be driveby ) and that can get the value to where you guys need it.
you could also ask the seller to bring price down since the home value appraises lower.
Or you could just walk away and look for new home.
as far as who pays - typically its the buyer but it can be anyone really depending on agreement.
you could get a normal appraisal (unless there was a reason for it to be driveby ) and that can get the value to where you guys need it.
you could also ask the seller to bring price down since the home value appraises lower.
Or you could just walk away and look for new home.
You will pay for the appraisal, most likely.
No one "usually" pays for the title work on a deal that does not haapen "if" the lender has a good relationship with the title company.
No one "usually" pays for the title work on a deal that does not haapen "if" the lender has a good relationship with the title company.
Unfortunately for the title companies they only get paid if the loan closes, much like mortgage brokers.
It's the cost of doing this type of business and they happily do it to get more business from their lender/broker relationships in the future.
The appraisal is almost always a cost paid up front by the borrower.
A drive by appraisal is not worth it's weight in US dollars. A lender or mortgage broker ordered appraisal will have to be done for a lender to accept the value, even then there is a chance they will NOT accept the value upon an appraisal review.
It's the cost of doing this type of business and they happily do it to get more business from their lender/broker relationships in the future.
The appraisal is almost always a cost paid up front by the borrower.
A drive by appraisal is not worth it's weight in US dollars. A lender or mortgage broker ordered appraisal will have to be done for a lender to accept the value, even then there is a chance they will NOT accept the value upon an appraisal review.
LOL... drive by? Exterior inspections are most likely for statusing purposes....For purchase transactions the lender needs a full inspection ( the underwriter must be happy for the loan to go thru :)....and most likely the value will come in...condition (including interior) matters!!!!
To evolovik, don't know why it's a drive appraisal, that 's what the appraiser did, we were novice, so just didn't question. could you find any thing that we are missing out in this deal?
To chris, you mean we have to go for another appraisal which isn't a drive by?
To chris, you mean we have to go for another appraisal which isn't a drive by?
Hi Stranger,
When a home is appraised below the purchase price you have three options. The first one is to bring more money to the table since the lender will base the value on the appraised value as mentioned above or you also have a second option. You can use this to renegotiate the purchase price. Sellers understand that they cannot realistically ask you to pay more than what the home is worth. You would have the right to walk away if the purchase contract has a contingency on financing as most of them do. I would definately have your realtor try and negotiate the purchase price based on the drive by appraisal. Last but not least, if you really want the home and feel that the appraiser came in low on the value, then I would suggest going with a different lender and different appraiser. Especially when it comes to drive by appraisal, they may not have been able to consider all of the interior improvements that have been made to maximize the value of the home that you want to purchase.
When a home is appraised below the purchase price you have three options. The first one is to bring more money to the table since the lender will base the value on the appraised value as mentioned above or you also have a second option. You can use this to renegotiate the purchase price. Sellers understand that they cannot realistically ask you to pay more than what the home is worth. You would have the right to walk away if the purchase contract has a contingency on financing as most of them do. I would definately have your realtor try and negotiate the purchase price based on the drive by appraisal. Last but not least, if you really want the home and feel that the appraiser came in low on the value, then I would suggest going with a different lender and different appraiser. Especially when it comes to drive by appraisal, they may not have been able to consider all of the interior improvements that have been made to maximize the value of the home that you want to purchase.