Sat, Jul 04, 2009
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Can I GET the FHA Appraiser to Reconsider? |
daveh
59 Posts
Member Since: 10/04/2002
Rochester Hills, MI
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Posted: 15:18 on 04-07-2003
Here's my short sale dilema:
Small 2/1 in a Detroit suburb (you can see photo's on my website below). Seller paid $83K two years ago, owes about $81K plus late fees, etc. This is an FHA loan. Home needs $10K to $20K in repairs depending on how nice you want it to look afterward.
Seller has been out of work most of the last year due to health problems and wanted to just dump it. I offered $30,200. I Put together a short sale package and set it to Loss Mitigation at Washigton Mutual. They were willing to consider a short sale. I intend to wholesale to a rehabber and have two verbal offers over $40K for the house as-is.
Lender sent out an appraiser a two weeks ago -- he apprased at $80K. Since this is FHA they will only go down to 82% of appraisal = $65,600. Adding $15k in repairs yields a break even at best. Obviously the numbers don't work. It doesn't seem as though he considered the property's diminished condition.
Also when I talked to the loss mitigation rep, she said that because (my) estimated repairs exceed 10% of the appraised value that HUD will not qualifiy the house for a short sale. I never heard this rule before???
I realize my only hope is to get the appraiser to reconsider a lower value to make this work. I have Comps in the area as low as $47K and as high as $100K for similar sized homes within 1/4 mile. I can take extra photos of the damage and compile my Comps and send them to the appraiser.
Will the Lender give me an appraisal copy and the apparaiser's contact info? Any chance the appraiser will reconsider?
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BAMZ
746 Posts
Member Since: 03/18/2003
Champaign, IL
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Posted: 17:08 on 04-07-2003
Hi DaveH,
Even if the appraiser would reconsider, the bank already has in their hands what they now perceive as the property value of $80,000.
You might consider a fax campaign to them. If you have pictures, resend them via mail. Otherwise, on your fax campaign, make it very clear that the value of the property is considerably lower than the BPO (and that the repair cost was not even taken into consideration on the BPO), and that it would be in the banks best interest to order another BPO from a different agent to compare it to. Let the banks know that if they dont do this, they may be in for a big surpirse!
I've never heard the deal about 10% of repairs scenario from HUD. That is a new one to me. Whether this is correct or not, it doesn't make sense. If HUD were to buy the home back, when they first list it on the market, it is marketed initially to owner occupied buyers. What (first time) homebuyer has a load of cash waiting to repair their first home? Sounds kind of funny.
Well listen, I would give it a go on the fax campaign, and if that is not working out, I would move on to the next one. Best of Success!
BAMZ 
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tanya1215
882 Posts
Member Since: 11/23/2002
Winter Park, FL
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Posted: 19:29 on 04-07-2003
Here is an reply by SharonRestrepo in another post called Opening dialog with prospective homeowner:
A BPO..."Broker's Price Opinion". This is basically an appraisal done by a real estate agent. It costs 1/3 of the price of a certified appraisal, so banks like to use them to determine a possible sales price for the home in question. When a property goes into default or foreclosure, the foreclosing lender orders a BPO to see where the stand financially with this potential future REO (real estate owned).
When doing a short sale, the lender will order an appraisal or BPO (at their expense) after receiving your short sale offer. They do this so they can determine whether to accept or counter your offer. That is why it is imperative you meet the person doing the BPO at the property when they go. You simply tell the lender that you are the contact person and have the key to the home and they need to have the real estate agent call you to make the appointment for the BPO. Dwan and I hand a copy of the short sale package to the BPO person and explain the situation. This helps the short sale process to go more in our favor. We do not bribe the person! We simply explain the situation just like we did to the lender. A tip: when you first submit your short sale offer, sometimes the lender will say "this is so low, we already have an appraisal for more at $X". This means that a BPO was already done (but, it was only a "drive-by", meaning the agent only saw the outside of the home from his/her car). Your reply is "the appraiser couldn't have possibly seen the inside!" and the lender will say, "well no, it was a drive by"; you say, "well, you've got to see inside; it's a mess, etc.". Hope this novel explains it better.....thanks.....Sharon
I hope this helps.
Tanya
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