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posted
Hello.. I am a first time buyer (single woman in hwr early thirties) and recently put an offer on a condo but the mortgage company is now appraising it at a lot lower (about 15K) or 10% than the offer. I'm not sure what to do next. I spent my lunch break sobbing because I am afraid that I will no longer be able to purchase the house.

Here is the details of the situation:

1. There was another offer on the condo so I had to offer full asking price. The Chicago real estate market is moving properties and most good condos have been getting two offers. The seller wasn't even willing to provide credits to fix some electrical problems due to the state of the market. I don't think they will budge.

2. I cannot have any higher payments than the original estimates without eating only Ramen Noodles.

3. My lease ends at the end of Sept. which means that if this deal doesn't go through I'll have no place to live.

I'm just really frustrated and especially concerned about my living situation. I was wondering if I have any recourse.
 
Posts: 7 | Registered: Aug 15, 2013Reply With QuoteReport This Post
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The mortgage company will only let you borrow what the condo is worth. Are you able or willing to pay the difference out of pocket? I suggest you look for a property that appraises at offer price or you will find yourself underwater as soon as you settle.
 
Posts: 120 | Registered: Apr 17, 2013Reply With QuoteReport This Post
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I think that I am getting screwed over by the mortgage company. There was another offer for around the same amount so it was market price. The mortgage company, Wells Fargo, has been cited in quit a few lawsuits in the past. And I cannot put down any more than I currently am. Is there anyway for me to report the mortgage people? I seriously don't know where I am going to live if this doesn't go through.
 
Posts: 7 | Registered: Aug 15, 2013Reply With QuoteReport This Post
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Did your agent provide you with comps to justify the price when you submitted the offer?

Did your agent contact the appraiser and provide those same comps to him/her to justify that price?

If the unit isn't worth it, I'd happily avoid a negative equity situation and pass on this transaction. (I'm assuming your offer contained an appraisal contingency.)

Did you contact your landlord about extending your rental on a month-to-month basis when the lease ends? Other options, e.g. placing your stuff in storage and renting a room from family and/or friends?

The mortgage company may be doing you a favor, IMHO. I'd start looking at other units and consider myself lucky.

Hope everything works out well, kag.

P.S. Congratulations on buying your first home! It's an exciting but stressful time. Don't worry, things will work out for the best. Take care -

This message has been edited. Last edited by: SurfNow,
 
Posts: 518 | Registered: Aug 29, 2011Reply With QuoteReport This Post
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1. No I just heard about this today. When we made the offer, there was another offer on the table at near the same selling price. My agent thought it was a good value.

2. My building switched landlords in late July and basically gave me a weeks notice saying that I ha to renew my lease now or they'd say it was for rent again. They aren't amenable to letting people renew leases on a month to month basis and are quite happy to shove people put on the street when their rent is up. I don't have family or any good friends nearby, so I really don't know what to do if this falls through.
 
Posts: 7 | Registered: Aug 15, 2013Reply With QuoteReport This Post
Picture of Jewel
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How did the seller respond to this news? The "onus" is really on them to match their price with the appraisal value if they want to sell. Chances are that they'll have the same issue with any other buyer. Do they want to sell or do they want to waste more time on the market?
 
Posts: 8200 | Registered: Sep 18, 2002Reply With QuoteReport This Post
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They had another offer for the same amount and can easily walk away. They aren't even willing to give a thousand dollar credit for some inspection issues that came up. The property was only listed for a week and had a lot of interest in it.
 
Posts: 7 | Registered: Aug 15, 2013Reply With QuoteReport This Post
Picture of Jewel
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First, the other buyer is probably long gone by now. Secondly, the seller is likely going to face the same issue when any other buyer gets their appraisal. Your realtor needs to impress this on the seller's realtor and encourage the seller to continue to work the deal with you.
 
Posts: 8200 | Registered: Sep 18, 2002Reply With QuoteReport This Post
Picture of Charming
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This is where your agent (The agent is your own agent not the seller's agent?) earns his/her commission. Have them get to work on the most recent comps (sold not listed properties in the area)) and do a point by point analysis of the appraisal. Make sure you get a copy today of the full report - it is yours, you paid for it. Your agent should then send the findings to the bank and request a new appraisal.

Sit down with your agent and good luck.

Good luck.


Fun and Info
 
Posts: 3564 | Location: Coastal SC | Registered: Jan 10, 2006Reply With QuoteReport This Post
Picture of rker321
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Although I understand your predicament, there is nothing worse than when you are buying any property, you are unable to walk away if things don't go the way you need them to go.
Becoming emotional when you buy a home disregarding the circumstances is not good for your or your future. If you were to have to sign again in your appt. how long? can you move to another place, perhaps with a roomate on a temp basis. Don't close yourself and become to entangle in a property that probably already is having lots of issues.

This message has been edited. Last edited by: rker321,
 
Posts: 5009 | Location: 0 | Registered: May 31, 2007Reply With QuoteReport This Post
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My current apartment is done. I cannot get an extension on it. I definitely have to move out by September 30th. The new management company is quite horrible. And I don't have any good friends or family in the area to live with. What exactly do you think I'm going to do? Move in with an anonymous roommate?

There are no problems with the property. The inspector has already checked things out. The problem is with the bank and the assessment. The Chicago real estate market has been steadily increasing since April. I think that the bank is being shady for some reason.
 
Posts: 7 | Registered: Aug 15, 2013Reply With QuoteReport This Post
Picture of Charming
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The bank is not being shady. The appraisers come out of a pool and some are good, some are bad. We had a bad one earlier this year and he under appraised our house by a significant amount. Fortunately it was a refi and we were okay, just made the amount available for HELOC lower than we would have liked.

As I posted before - put your agent to work. You do have options. The seller knows you are approved and also you have an appraisal in hand, if they are not willing to come down let them know you will walk. Depending on how long the property was on the market before they received your offer will help determine their response.

Also, you have 6 weeks - you are approved for a certain amount by the bank - put your agent to work finding another property while s/he also works on analyzing the appraisal.

This message has been edited. Last edited by: Charming,


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Posts: 3564 | Location: Coastal SC | Registered: Jan 10, 2006Reply With QuoteReport This Post
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I generally would not suggest something like this, but if you are still in your apartment after September 30th, what do you think the landlord can do? It will take them quite a while to initiate court proceedings to have you evicted. Notify them in writing a day or two before that you will be unable to vacate on time, but you should find out what your existing lease or state's laws are regarding court costs and attorney's fees.
 
Posts: 748 | Registered: Jan 02, 2005Reply With QuoteReport This Post
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I don't know about the state that she happens to be, but in Ca. they have that issue well taken care of. It takes no more than 30 days to evict anyone.
 
Posts: 5009 | Location: 0 | Registered: May 31, 2007Reply With QuoteReport This Post
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They must give you a written 30 day notice to resign or vacate within 30 days. I would find out the name of their corporate office and tell them what is going on and how you have been a good tenant and have been paying on time and you are not understanding not being able to sign month to month or just basically told to get out.
 
Posts: 168 | Location: Creve Coeur, Missouri | Registered: Jan 16, 2008Reply With QuoteReport This Post
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kag1982, Seems like you have two problems - one, the appraisal of the place you were hoping to buy didn't work out - simple solution = keep looking and find another place (that will probably be even better). Smile

2nd problem? Your current place has given you notice in July that you need to vacate since it has been sold. What is so hard to understand about that? You've been given 90 days notice - more than fair.

My suggestion? Gear up and start house-hunting in earnest right away and, meanwhile, find another place to rent on a month-to-month basis or even a 6/12 month lease if possible. Might give you some time to decide/research ... Good luck Cool
 
Posts: 6492 | Registered: Jan 01, 2008Reply With QuoteReport This Post
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Hello.. My lease ends in September and I was basically told at the end of July that I needed to design within a week or the place would be put up for rent again August 1st. I literally didn't receive the papers in the mail until five days before they needed to be returned. I talked to my realtor, mortgage broker, etc. and theybdidn't think this would be an issue. The problem really is that the condo market has gotten hot in Chicago and the particular area where I live is fairly hot in August because it is near a university. The appraisal is incorrect. Any appraisal on an apartment would be incorrect because the market has changed since April.

And I've never heard of a reputable leasing company offering month by month leases or even leases less than on an annual basis. I'm a single woman who lives alone so just for safety purposes I'd prefer no anonymous roommates or renting in shady areas.
 
Posts: 7 | Registered: Aug 15, 2013Reply With QuoteReport This Post
Picture of Charming
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kag1982 - What is your agent doing to challenge the appraisal? I asked this in 2 different posts. Still wondering?

Also - do you have to live in the University area? By limiting your search range you are putting yourself into more of a time constraint.


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Posts: 3564 | Location: Coastal SC | Registered: Jan 10, 2006Reply With QuoteReport This Post
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I'm not moving out of the area I'm living in because I really hate suburbs, especially subdivisions where all the houses look the same. And I'm not moving into a dangerous or poor area. I have to live in this condo for awhile.
 
Posts: 7 | Registered: Aug 15, 2013Reply With QuoteReport This Post
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