Appraisal concern with offering way over asking - Page 2

The Silverback

Joined: Dec 11, 2003

Posts: 6,572

User Profile

Private Message

Ignore User Stop Ignoring

How long do you want to ignore this user?

24 hours One week Permanently Cancel

11:13a, 10/22/21

AG

Yes, basically every dollar under your purchase price that the appraisal comes in at you need to come out of pocket the difference.

This only effects the people who are putting the min down for their particular program whether that be 5%. 10% or 20% down.

If you have the ability to come out of pocket more on your down with out a problem then this is a non-issue for you.

1

jja79

Joined: May 24, 2002

Posts: 38,698

User Profile

Private Message

Ignore User Stop Ignoring

How long do you want to ignore this user?

24 hours One week Permanently Cancel

In reply to The Silverback • 11:19a, 10/22/21

AG

If the appraisal is under purchase price you don't necessarily have to come out of pocket with more. You have that option but raising LTV is also an option for most buyers.

htxag09

Joined: Sep 28, 2010

Posts: 18,015

User Profile

Private Message

Ignore User Stop Ignoring

How long do you want to ignore this user?

24 hours One week Permanently Cancel

In reply to The Silverback • 11:26a, 10/22/21

AG

That makes sense. So if you want to borrow 80% to avoid PMI:

Purchase price: $200k

80% = $160k
down payment: ($200k - $160k = $40k)

Appraisal price: $190K

80% = $152K
down payment: ($200k - $152k = $48k)

If you're putting down 35%, 15%, etc. than it likely doesn't matter as long as that % isn't a condition of the loan or a benchmark for something, like PMI?

SteveBott

Joined: Jan 22, 2002

Posts: 46,660

User Profile

Private Message

Ignore User Stop Ignoring

How long do you want to ignore this user?

24 hours One week Permanently Cancel

11:43a, 10/22/21

AG

We always use "the lower of" Appraisel or sales price.

knoxtom

Joined: Oct 5, 2009

Posts: 2,169

User Profile Ignore User Stop Ignoring

How long do you want to ignore this user?

24 hours One week Permanently Cancel

1:17p, 10/22/21

No one is going to accept an offer for over asking without an appraisal guarantee. If you are going to offer over asking, you may want to mentally prep yourself for coming out of pocket.

When we sold our house in Keller this last summer we received 9 offers the first weekend. All were over asking, all had guarantees on appraisal, most covered all closing costs, and half waived inspection. The winning offer was 100k over asking and had all of the above clauses.

4

dudeabides

Joined: Jan 2, 2016

Posts: 1,018

User Profile

Private Message

Ignore User Stop Ignoring

How long do you want to ignore this user?

24 hours One week Permanently Cancel

In reply to knoxtom • 2:04p, 10/22/21

AG

knoxtomNo one is going to accept an offer for over asking without an appraisal guarantee. If you are going to offer over asking, you may want to mentally prep yourself for coming out of pocket.

When we sold our house in Keller this last summer we received 9 offers the first weekend. All were over asking, all had guarantees on appraisal, most covered all closing costs, and half waived inspection. The winning offer was 100k over asking and had all of the above clauses.

2

1 edit