Lazy Home Appraisers (1 Viewer)

[James Daulton]

I believe I failed to mention that the same bank I'm trying to refinance with now (PNC), I refinanced with in March 2011 (lower rate, shorter term). The appraisal from that refinance was $110k higher than this one.

No impact on the current appraisal.

I get that but wouldn't it lead the bank to at least check and see if the current appraisal is #### by getting another one? Why would the bank want to lose a long time customer like me with a good history with them, steady job, and good credit? Being that inflexible doesn't make good business sense.

 

[RedmondLonghorn]

I believe I failed to mention that the same bank I'm trying to refinance with now (PNC), I refinanced with in March 2011 (lower rate, shorter term). The appraisal from that refinance was $110k higher than this one.

No impact on the current appraisal.

His point was that at least one of them is very wrong because market conditions haven't changed that much.

 

[Chadstroma]

I believe I failed to mention that the same bank I'm trying to refinance with now (PNC), I refinanced with in March 2011 (lower rate, shorter term). The appraisal from that refinance was $110k higher than this one.

No impact on the current appraisal.

I get that but wouldn't it lead the bank to at least check and see if the current appraisal is #### by getting another one? Why would the bank want to lose a long time customer like me with a good history with them, steady job, and good credit? Being that inflexible doesn't make good business sense.

It is not the bank's option. They are more scared of regulators than they are of you.

In an ideal world, the comp from a year ago would reflect value in the comps used for purchases from then to now. But- a short sale, foreclosure or extremely motivated seller can screw all that up pretty quickly.

 

[sbonomo]

Appraisers are a joke.

We sold our house recently and the three comps used were two houses about $10K above the offer we accepted and the other was one for $30K less. The one for $30K less did not have a finished basement, had 1 fewer bathroom and bedroom, and was just not as structurally appealing as our home. Regardless, he appraised our house at $5K TO THE DOLLAR less than the offer we accepted....so based on his judgment, we lost $5K in equity just like that.

The ##### knew what the accepted offer was, so he chose to make it $5K less. I've been over and over the appraisal report and the numbers still don't make sense. We requested a copy of the report as soon as we were given this information by their real estate agent. She "requested" it from the lender (or so she says) 5 times. We didn't even get a chance to see it until we were at closing. It just all seemed so shady. But we were stuck. We had already started the process of building our next house and had put deposits down on an apartment, etc.

Not to mention the appraiser canceled the appraisal twice (first time 30 minutes before he was to be there and the 2nd time an hour after he was supposed to be there -- both times I had taken off work) because he supposedly had "the flu" in the middle of the summer. I wanted to punch this guy hard. #### him.

Did you have backup offers? I had a completely remodeled home sell for significantly more than the appraisal. I let the first couple out of the contract and relisted with a no appraisal clause (see above for explanation). Ii ended up selling for 20K more than the original contract. I felt bad for the couple that cancelled but, they had chitty advice from their agent. They ended up in the same area in a similar house that did not have the 60K in upgrades that i put into mine. Point is, if the place is right, people will spend the extra dough to get in.

 

[James Daulton]

I believe I failed to mention that the same bank I'm trying to refinance with now (PNC), I refinanced with in March 2011 (lower rate, shorter term). The appraisal from that refinance was $110k higher than this one.

No impact on the current appraisal.

I get that but wouldn't it lead the bank to at least check and see if the current appraisal is #### by getting another one? Why would the bank want to lose a long time customer like me with a good history with them, steady job, and good credit? Being that inflexible doesn't make good business sense.

It is not the bank's option. They are more scared of regulators than they are of you.

In an ideal world, the comp from a year ago would reflect value in the comps used for purchases from then to now. But- a short sale, foreclosure or extremely motivated seller can screw all that up pretty quickly.

So an appraiser does a #### job and their word is final with no recourse? That sounds like really dumb business to me. I have been in contact with my mortgage guy and will report back when he tells me I'm ####ed with PNC.

 

[culdeus]

I believe I failed to mention that the same bank I'm trying to refinance with now (PNC), I refinanced with in March 2011 (lower rate, shorter term). The appraisal from that refinance was $110k higher than this one.

No impact on the current appraisal.

I get that but wouldn't it lead the bank to at least check and see if the current appraisal is #### by getting another one? Why would the bank want to lose a long time customer like me with a good history with them, steady job, and good credit? Being that inflexible doesn't make good business sense.

It is not the bank's option. They are more scared of regulators than they are of you.

In an ideal world, the comp from a year ago would reflect value in the comps used for purchases from then to now. But- a short sale, foreclosure or extremely motivated seller can screw all that up pretty quickly.

Try someone selling their perfectly serviceable house for lot value. Then getting a appraise back that's less than the dirt? This happened 6 doors down from me. The appraiser didn't even bother to validate the sale was for lot.

 

[Chadstroma]

I believe I failed to mention that the same bank I'm trying to refinance with now (PNC), I refinanced with in March 2011 (lower rate, shorter term). The appraisal from that refinance was $110k higher than this one.

No impact on the current appraisal.

His point was that at least one of them is very wrong because market conditions haven't changed that much.

Sure. Most likely I agree (all else being equal). I disagree with appraisals all the time. You know how much worth that is in getting a loan deal done? Somewhere between zero and zilch.

You can use that as 'circumstantial' evidence in an argument to have the appraisal reviewed but it will not be factored into the appraisal.

 

[thecatch]

I get that. just seems like you're getting 10-20% of what you paid at an appraisal. I think buyers would be willing to pay an extra $10-15k for an updated kitchen for example. you'd think an appraisal could show 50% of that even.

You can expect to get back materials costs, not labor. Materials depreciate over 3 years to nothing.

Pools are a $0 adder no matter what you spend.

I went thru this whole thing buying. It was a massive beating.

I just went through the appraisal process with a new home and at least according to our appraiser, pools were assigned a value of $25k in our area.

 

[doowain]

Appraisers are a joke.

We sold our house recently and the three comps used were two houses about $10K above the offer we accepted and the other was one for $30K less. The one for $30K less did not have a finished basement, had 1 fewer bathroom and bedroom, and was just not as structurally appealing as our home. Regardless, he appraised our house at $5K TO THE DOLLAR less than the offer we accepted....so based on his judgment, we lost $5K in equity just like that.

The ##### knew what the accepted offer was, so he chose to make it $5K less. I've been over and over the appraisal report and the numbers still don't make sense. We requested a copy of the report as soon as we were given this information by their real estate agent. She "requested" it from the lender (or so she says) 5 times. We didn't even get a chance to see it until we were at closing. It just all seemed so shady. But we were stuck. We had already started the process of building our next house and had put deposits down on an apartment, etc.

Not to mention the appraiser canceled the appraisal twice (first time 30 minutes before he was to be there and the 2nd time an hour after he was supposed to be there -- both times I had taken off work) because he supposedly had "the flu" in the middle of the summer. I wanted to punch this guy hard. #### him.

Did you have backup offers? I had a completely remodeled home sell for significantly more than the appraisal. I let the first couple out of the contract and relisted with a no appraisal clause (see above for explanation). Ii ended up selling for 20K more than the original contract. I felt bad for the couple that cancelled but, they had chitty advice from their agent. They ended up in the same area in a similar house that did not have the 60K in upgrades that i put into mine. Point is, if the place is right, people will spend the extra dough to get in.

No backup offers. We sold in less than 3 weeks.

I'm assuming the couple that bought your house came to closing with that extra $20K? That is not a common occurrence considering they are already putting a hefty amount down.

ETA: We could've asked for the extra $5K in the appraisal difference, but we'd have risked losing the buyer. And even if we did, we couldn't sell to anyone else over the next x number of months any higher than that appraisal value. Again, unless the buyer was willing to bring the extra $5K.

 

[comfortably numb]

I get that. just seems like you're getting 10-20% of what you paid at an appraisal. I think buyers would be willing to pay an extra $10-15k for an updated kitchen for example. you'd think an appraisal could show 50% of that even.

You can expect to get back materials costs, not labor. Materials depreciate over 3 years to nothing.

Pools are a $0 adder no matter what you spend.

I went thru this whole thing buying. It was a massive beating.

I just went through the appraisal process with a new home and at least according to our appraiser, pools were assigned a value of $25k in our area.

Is your area the playboy mansion?

 

[doowain]

I get that. just seems like you're getting 10-20% of what you paid at an appraisal. I think buyers would be willing to pay an extra $10-15k for an updated kitchen for example. you'd think an appraisal could show 50% of that even.

You can expect to get back materials costs, not labor. Materials depreciate over 3 years to nothing.

Pools are a $0 adder no matter what you spend.

I went thru this whole thing buying. It was a massive beating.

I just went through the appraisal process with a new home and at least according to our appraiser, pools were assigned a value of $25k in our area.

Yep. Don't know what culdeus is talking about. Unless it's an above ground pool or it's an inground in need of major repair, it absolutely adds value to the home.

ETA: $25K doesn't seem realistic, but it does add value.

 

[Chadstroma]

I believe I failed to mention that the same bank I'm trying to refinance with now (PNC), I refinanced with in March 2011 (lower rate, shorter term). The appraisal from that refinance was $110k higher than this one.

No impact on the current appraisal.

I get that but wouldn't it lead the bank to at least check and see if the current appraisal is #### by getting another one? Why would the bank want to lose a long time customer like me with a good history with them, steady job, and good credit? Being that inflexible doesn't make good business sense.

It is not the bank's option. They are more scared of regulators than they are of you.

In an ideal world, the comp from a year ago would reflect value in the comps used for purchases from then to now. But- a short sale, foreclosure or extremely motivated seller can screw all that up pretty quickly.

So an appraiser does a #### job and their word is final with no recourse? That sounds like really dumb business to me. I have been in contact with my mortgage guy and will report back when he tells me I'm ####ed with PNC.

An appraisal is an opinion so there is a significant amount of leeway in it. Unless I can show good comps (good meaning within time/location limits) or show that there is an error in the appraisal such as number of bedrooms wrong or size of garage or sqft, etc. There is nothing that will be done. It is not up to PNC or any other bank. Before, I could call up the appraiser and speak directly to him. Point out this or that and whatever. More times than not I would get an increase. I never pressured or did anything other than inform the appraiser of things I thought he might have missed or did not take into account fully etc. But- as with anything, a good thing was abused and now you can't do that.

If you don't like it like that then complain to your congressman because the changes are directly from Dodd-Frank and the resulting regulations.

Also, the bank is not going to spend money to get a new appraisal. You say you want to spend another $400 for another appraisal? What happens if that comes in low too? You wouldn't be even more unhappy for spending money on a second low appraisal?

 

[thecatch]

I get that. just seems like you're getting 10-20% of what you paid at an appraisal. I think buyers would be willing to pay an extra $10-15k for an updated kitchen for example. you'd think an appraisal could show 50% of that even.

You can expect to get back materials costs, not labor. Materials depreciate over 3 years to nothing.

Pools are a $0 adder no matter what you spend.

I went thru this whole thing buying. It was a massive beating.

I just went through the appraisal process with a new home and at least according to our appraiser, pools were assigned a value of $25k in our area.

Yep. Don't know what culdeus is talking about. Unless it's an above ground pool or it's an inground in need of major repair, it absolutely adds value to the home.

ETA: $25K doesn't seem realistic, but it does add value.

I'm not defending the valuation, that's just what our report said. Clearly they can be worth something on an appraisal report, contrary to Culdeus's assertion.

 

[Bogeys]

I believe I failed to mention that the same bank I'm trying to refinance with now (PNC), I refinanced with in March 2011 (lower rate, shorter term). The appraisal from that refinance was $110k higher than this one.

No impact on the current appraisal.

I get that but wouldn't it lead the bank to at least check and see if the current appraisal is #### by getting another one? Why would the bank want to lose a long time customer like me with a good history with them, steady job, and good credit? Being that inflexible doesn't make good business sense.

It is not the bank's option. They are more scared of regulators than they are of you.

In an ideal world, the comp from a year ago would reflect value in the comps used for purchases from then to now. But- a short sale, foreclosure or extremely motivated seller can screw all that up pretty quickly.

So an appraiser does a #### job and their word is final with no recourse? That sounds like really dumb business to me. I have been in contact with my mortgage guy and will report back when he tells me I'm ####ed with PNC.

An appraisal is an opinion so there is a significant amount of leeway in it. Unless I can show good comps (good meaning within time/location limits) or show that there is an error in the appraisal such as number of bedrooms wrong or size of garage or sqft, etc. There is nothing that will be done. It is not up to PNC or any other bank. Before, I could call up the appraiser and speak directly to him. Point out this or that and whatever. More times than not I would get an increase. I never pressured or did anything other than inform the appraiser of things I thought he might have missed or did not take into account fully etc. But- as with anything, a good thing was abused and now you can't do that.

If you don't like it like that then complain to your congressman because the changes are directly from Dodd-Frank and the resulting regulations.

Also, the bank is not going to spend money to get a new appraisal. You say you want to spend another $400 for another appraisal? What happens if that comes in low too? You wouldn't be even more unhappy for spending money on a second low appraisal?

Can also file a complaint with the board that governs appraisers. This is what I ended up doing when an appraisal came in about 20% less than what it should have been based on comps in the area. Guy used comps that were 3 miles away in a completely different neighborhood instead of the 3 in my same subdivision that had sold in the last 6 months. Don't know what the outcome with him was (probably nothing), but I did make him waste his time going to a hearing, responding to the complaint and the answer to his answer, etc. Felt good thinking about this POS getting aggravated every time he got a letter from the State.

Oh, and I had to change banks but another appraisal a month later came in about 25% higher than this jackwads and was just slightly higher than what the comps showed.

 

[culdeus]

My experiences come from living in an odd area. About half the homes were built in the 60s and the people who built the homes and or had children in that timeframe never moved out. Now their houses are being sold for lot and rebuilt on.

About half the homes were kept up or had some appeal and were fixed up over time above lot value.

Lots go for about 375 to build a 950-1050 home (total cost) on.

Now underneath that are the fixed up homes that can range from 300 if they need some work but are ok, up to 550. Getting comps on these is impossible so everyone in the area passes around our refi documents to eachother to make sure the comps work out right and people are getting the right valuation (primarily refi driven). So I've looked at 10-12 refi docs over the last couple years and have a good feel for how ####ty these people are at doing their job.

 

[Chadstroma]

I believe I failed to mention that the same bank I'm trying to refinance with now (PNC), I refinanced with in March 2011 (lower rate, shorter term). The appraisal from that refinance was $110k higher than this one.

No impact on the current appraisal.

I get that but wouldn't it lead the bank to at least check and see if the current appraisal is #### by getting another one? Why would the bank want to lose a long time customer like me with a good history with them, steady job, and good credit? Being that inflexible doesn't make good business sense.

It is not the bank's option. They are more scared of regulators than they are of you.

In an ideal world, the comp from a year ago would reflect value in the comps used for purchases from then to now. But- a short sale, foreclosure or extremely motivated seller can screw all that up pretty quickly.

So an appraiser does a #### job and their word is final with no recourse? That sounds like really dumb business to me. I have been in contact with my mortgage guy and will report back when he tells me I'm ####ed with PNC.

An appraisal is an opinion so there is a significant amount of leeway in it. Unless I can show good comps (good meaning within time/location limits) or show that there is an error in the appraisal such as number of bedrooms wrong or size of garage or sqft, etc. There is nothing that will be done. It is not up to PNC or any other bank. Before, I could call up the appraiser and speak directly to him. Point out this or that and whatever. More times than not I would get an increase. I never pressured or did anything other than inform the appraiser of things I thought he might have missed or did not take into account fully etc. But- as with anything, a good thing was abused and now you can't do that.

If you don't like it like that then complain to your congressman because the changes are directly from Dodd-Frank and the resulting regulations.

Also, the bank is not going to spend money to get a new appraisal. You say you want to spend another $400 for another appraisal? What happens if that comes in low too? You wouldn't be even more unhappy for spending money on a second low appraisal?

Can also file a complaint with the board that governs appraisers. This is what I ended up doing when an appraisal came in about 20% less than what it should have been based on comps in the area. Guy used comps that were 3 miles away in a completely different neighborhood instead of the 3 in my same subdivision that had sold in the last 6 months. Don't know what the outcome with him was (probably nothing), but I did make him waste his time going to a hearing, responding to the complaint and the answer to his answer, etc. Felt good thinking about this POS getting aggravated every time he got a letter from the State.

Oh, and I had to change banks but another appraisal a month later came in about 25% higher than this jackwads and was just slightly higher than what the comps showed.

That is very odd.

Yea, changing banks/broker, etc will allow you to get another appraisal. If you are paying for it then that sucks getting two appraisals. If you are not paying for it then it is on the banks dime. So as a consumer, it is up to you.

You can have two people come in with two very different numbers on an appraisal- and still be within 'reason'. That does not say that there are crappy appraisers out there doing crappy jobs.... just gives them a whole lotta shade to sit in if the heat gets turned up.

 

[Chadstroma]

My experiences come from living in an odd area. About half the homes were built in the 60s and the people who built the homes and or had children in that timeframe never moved out. Now their houses are being sold for lot and rebuilt on.

About half the homes were kept up or had some appeal and were fixed up over time above lot value.

Lots go for about 375 to build a 950-1050 home (total cost) on.

Now underneath that are the fixed up homes that can range from 300 if they need some work but are ok, up to 550. Getting comps on these is impossible so everyone in the area passes around our refi documents to eachother to make sure the comps work out right and people are getting the right valuation (primarily refi driven). So I've looked at 10-12 refi docs over the last couple years and have a good feel for how ####ty these people are at doing their job.

My SIL/BIL ended up getting a house that was sort of left to them by a grandfather who passed (they had to buy out other family members). It is a very old and small house in need of a lot of work sitting on a large (for the area) lot in a desirable burb. I urged them to bulldoze the house and get a construction loan- if not to live in to turn around and sell and then buy another home with the proceeds.

I am not very close to them and I communicated it through my wife to tell them (which my wife agreed that they should do). They decided not to do it but to fix the house up instead. I never bothered to find out their reasoning. Such a huge mistake IMO. They would make a killing.

 

[Bogeys]

I believe I failed to mention that the same bank I'm trying to refinance with now (PNC), I refinanced with in March 2011 (lower rate, shorter term). The appraisal from that refinance was $110k higher than this one.

No impact on the current appraisal.

I get that but wouldn't it lead the bank to at least check and see if the current appraisal is #### by getting another one? Why would the bank want to lose a long time customer like me with a good history with them, steady job, and good credit? Being that inflexible doesn't make good business sense.

It is not the bank's option. They are more scared of regulators than they are of you.

In an ideal world, the comp from a year ago would reflect value in the comps used for purchases from then to now. But- a short sale, foreclosure or extremely motivated seller can screw all that up pretty quickly.

So an appraiser does a #### job and their word is final with no recourse? That sounds like really dumb business to me. I have been in contact with my mortgage guy and will report back when he tells me I'm ####ed with PNC.

An appraisal is an opinion so there is a significant amount of leeway in it. Unless I can show good comps (good meaning within time/location limits) or show that there is an error in the appraisal such as number of bedrooms wrong or size of garage or sqft, etc. There is nothing that will be done. It is not up to PNC or any other bank. Before, I could call up the appraiser and speak directly to him. Point out this or that and whatever. More times than not I would get an increase. I never pressured or did anything other than inform the appraiser of things I thought he might have missed or did not take into account fully etc. But- as with anything, a good thing was abused and now you can't do that.

If you don't like it like that then complain to your congressman because the changes are directly from Dodd-Frank and the resulting regulations.

Also, the bank is not going to spend money to get a new appraisal. You say you want to spend another $400 for another appraisal? What happens if that comes in low too? You wouldn't be even more unhappy for spending money on a second low appraisal?

Can also file a complaint with the board that governs appraisers. This is what I ended up doing when an appraisal came in about 20% less than what it should have been based on comps in the area. Guy used comps that were 3 miles away in a completely different neighborhood instead of the 3 in my same subdivision that had sold in the last 6 months. Don't know what the outcome with him was (probably nothing), but I did make him waste his time going to a hearing, responding to the complaint and the answer to his answer, etc. Felt good thinking about this POS getting aggravated every time he got a letter from the State.

Oh, and I had to change banks but another appraisal a month later came in about 25% higher than this jackwads and was just slightly higher than what the comps showed.

That is very odd.

Yea, changing banks/broker, etc will allow you to get another appraisal. If you are paying for it then that sucks getting two appraisals. If you are not paying for it then it is on the banks dime. So as a consumer, it is up to you.

You can have two people come in with two very different numbers on an appraisal- and still be within 'reason'. That does not say that there are crappy appraisers out there doing crappy jobs.... just gives them a whole lotta shade to sit in if the heat gets turned up.

Yeah, the first bank actually appealed it but said there was nothing they could do and they had to accept what the appraiser said.

The appraiser's justification for the long distance was that I hadn't updated the kitchen or repainted, new floors, etc. That the comps in my subdivision had done 1 or all of these things so he couldn't use them as comps. So I asked why he didn't go the other direction...I was in an "in between" type older neighborhood. The direction he went were where it was mostly rent houses and low income, if he had went literally a tenth of a mile the opposite direction it was new 3000 sf houses. Found out he had done the appraisals on 2 of the comps he used and had some service where he paid for the other....was just cheaper for him to do it the way he did it and he wouldn't back off his initial appraisal. That is why I decided to make him jump through the hoops just to try to tick him off.

 

[bagger]

I am in the middle of a refi also. My lender was looking at house values on Zillow.com (He said he usually gets a fair estimate) and the appraisal came in $40k under the Zillow estimate. The PITA was the fact that with the estimate we could have easily walked in and out without putting out a dime, now with the lower appraisal, we will have to shell out ~$6k in order to not have PMI on the loan.

Was talking to my lender about this whole thing, and I jokingly said that wouldn't it be nice if we could just go to the appraiser and say "Can't you just give us $10k more?" He came back with that in the past they could, and that is partially what lead to the Housing Crisis people were mentioning above. Since 2007, the lender isn't allowed any contact with the appraiser, there is a dept in their bank (SunTrust) that deals with them solely. Now I understand that $10k on my place isn't going to cause the world to end, but you can see how lenders saying to appraisers, "give me X on this house or you won't work for me again" and the X being large, could lead to bad things.

In the end, since we are not financing what amounts to the closing costs, we will actually save more per month on the new loan, and with a skipped payment with the timing of the old and new loans, we will make up the amount we shelled out in about 6 months, so it will not be a big deal.

i am about to put my house on the market and I will likely sell it for $50k less than the Zillow number. Am listing it for $30k under it. Zillow is nice to get very general estimates but not good at all specifically.

 

[Mr. Ected]

I am in the middle of a refi also. My lender was looking at house values on Zillow.com (He said he usually gets a fair estimate) and the appraisal came in $40k under the Zillow estimate. The PITA was the fact that with the estimate we could have easily walked in and out without putting out a dime, now with the lower appraisal, we will have to shell out ~$6k in order to not have PMI on the loan.

Was talking to my lender about this whole thing, and I jokingly said that wouldn't it be nice if we could just go to the appraiser and say "Can't you just give us $10k more?" He came back with that in the past they could, and that is partially what lead to the Housing Crisis people were mentioning above. Since 2007, the lender isn't allowed any contact with the appraiser, there is a dept in their bank (SunTrust) that deals with them solely. Now I understand that $10k on my place isn't going to cause the world to end, but you can see how lenders saying to appraisers, "give me X on this house or you won't work for me again" and the X being large, could lead to bad things.

In the end, since we are not financing what amounts to the closing costs, we will actually save more per month on the new loan, and with a skipped payment with the timing of the old and new loans, we will make up the amount we shelled out in about 6 months, so it will not be a big deal.

i am about to put my house on the market and I will likely sell it for $50k less than the Zillow number. Am listing it for $30k under it. Zillow is nice to get very general estimates but not good at all specifically.

You're probably right, but the lender was a bit surprised that it came in that low, that the Zillow numbers in our area were fairly accurate.

 

[Chadstroma]

I am in the middle of a refi also. My lender was looking at house values on Zillow.com (He said he usually gets a fair estimate) and the appraisal came in $40k under the Zillow estimate. The PITA was the fact that with the estimate we could have easily walked in and out without putting out a dime, now with the lower appraisal, we will have to shell out ~$6k in order to not have PMI on the loan.

Was talking to my lender about this whole thing, and I jokingly said that wouldn't it be nice if we could just go to the appraiser and say "Can't you just give us $10k more?" He came back with that in the past they could, and that is partially what lead to the Housing Crisis people were mentioning above. Since 2007, the lender isn't allowed any contact with the appraiser, there is a dept in their bank (SunTrust) that deals with them solely. Now I understand that $10k on my place isn't going to cause the world to end, but you can see how lenders saying to appraisers, "give me X on this house or you won't work for me again" and the X being large, could lead to bad things.

In the end, since we are not financing what amounts to the closing costs, we will actually save more per month on the new loan, and with a skipped payment with the timing of the old and new loans, we will make up the amount we shelled out in about 6 months, so it will not be a big deal.

i am about to put my house on the market and I will likely sell it for $50k less than the Zillow number. Am listing it for $30k under it. Zillow is nice to get very general estimates but not good at all specifically.

Yea, Zillow is really not very accurate usually. I only use it to get a ballpark idea or when the customer has no idea at all (or plays like they don't as if that matters). Any time I use Zillow in a conversation with a customer I always explain to them that Zillow can actually hurt more than help in getting an idea of value.

My own home purchase Zillow was about 10% below purchase price and the appraisal was higher than my purchase price (reduced down to purchase price).

 

[sbonomo]

Appraisers are a joke.

We sold our house recently and the three comps used were two houses about $10K above the offer we accepted and the other was one for $30K less. The one for $30K less did not have a finished basement, had 1 fewer bathroom and bedroom, and was just not as structurally appealing as our home. Regardless, he appraised our house at $5K TO THE DOLLAR less than the offer we accepted....so based on his judgment, we lost $5K in equity just like that.

The ##### knew what the accepted offer was, so he chose to make it $5K less. I've been over and over the appraisal report and the numbers still don't make sense. We requested a copy of the report as soon as we were given this information by their real estate agent. She "requested" it from the lender (or so she says) 5 times. We didn't even get a chance to see it until we were at closing. It just all seemed so shady. But we were stuck. We had already started the process of building our next house and had put deposits down on an apartment, etc.

Not to mention the appraiser canceled the appraisal twice (first time 30 minutes before he was to be there and the 2nd time an hour after he was supposed to be there -- both times I had taken off work) because he supposedly had "the flu" in the middle of the summer. I wanted to punch this guy hard. #### him.

Did you have backup offers? I had a completely remodeled home sell for significantly more than the appraisal. I let the first couple out of the contract and relisted with a no appraisal clause (see above for explanation). Ii ended up selling for 20K more than the original contract. I felt bad for the couple that cancelled but, they had chitty advice from their agent. They ended up in the same area in a similar house that did not have the 60K in upgrades that i put into mine. Point is, if the place is right, people will spend the extra dough to get in.

No backup offers. We sold in less than 3 weeks.

I'm assuming the couple that bought your house came to closing with that extra $20K? That is not a common occurrence considering they are already putting a hefty amount down.

ETA: We could've asked for the extra $5K in the appraisal difference, but we'd have risked losing the buyer. And even if we did, we couldn't sell to anyone else over the next x number of months any higher than that appraisal value. Again, unless the buyer was willing to bring the extra $5K.

Yes they paid the full asking price which would increase the loan amount, or lack there of in my case. As long as their lender is okay with the LTV, i don't know why you would care. If you sold it in three weeks, you definitely left the 5k on the tables. Sounds like your were okay with it for the convenience though right?

 

[doowain]

Appraisers are a joke.

We sold our house recently and the three comps used were two houses about $10K above the offer we accepted and the other was one for $30K less. The one for $30K less did not have a finished basement, had 1 fewer bathroom and bedroom, and was just not as structurally appealing as our home. Regardless, he appraised our house at $5K TO THE DOLLAR less than the offer we accepted....so based on his judgment, we lost $5K in equity just like that.

The ##### knew what the accepted offer was, so he chose to make it $5K less. I've been over and over the appraisal report and the numbers still don't make sense. We requested a copy of the report as soon as we were given this information by their real estate agent. She "requested" it from the lender (or so she says) 5 times. We didn't even get a chance to see it until we were at closing. It just all seemed so shady. But we were stuck. We had already started the process of building our next house and had put deposits down on an apartment, etc.

Not to mention the appraiser canceled the appraisal twice (first time 30 minutes before he was to be there and the 2nd time an hour after he was supposed to be there -- both times I had taken off work) because he supposedly had "the flu" in the middle of the summer. I wanted to punch this guy hard. #### him.

Did you have backup offers? I had a completely remodeled home sell for significantly more than the appraisal. I let the first couple out of the contract and relisted with a no appraisal clause (see above for explanation). Ii ended up selling for 20K more than the original contract. I felt bad for the couple that cancelled but, they had chitty advice from their agent. They ended up in the same area in a similar house that did not have the 60K in upgrades that i put into mine. Point is, if the place is right, people will spend the extra dough to get in.

No backup offers. We sold in less than 3 weeks.

I'm assuming the couple that bought your house came to closing with that extra $20K? That is not a common occurrence considering they are already putting a hefty amount down.

ETA: We could've asked for the extra $5K in the appraisal difference, but we'd have risked losing the buyer. And even if we did, we couldn't sell to anyone else over the next x number of months any higher than that appraisal value. Again, unless the buyer was willing to bring the extra $5K.

Yes they paid the full asking price which would increase the loan amount, or lack there of in my case. As long as their lender is okay with the LTV, i don't know why you would care. If you sold it in three weeks, you definitely left the 5k on the tables. Sounds like your were okay with it for the convenience though right?

That's my whole point. Lenders won't lend money above the appraisal value.

 

[cstu]

I am in the middle of a refi also. My lender was looking at house values on Zillow.com (He said he usually gets a fair estimate) and the appraisal came in $40k under the Zillow estimate. The PITA was the fact that with the estimate we could have easily walked in and out without putting out a dime, now with the lower appraisal, we will have to shell out ~$6k in order to not have PMI on the loan.

Was talking to my lender about this whole thing, and I jokingly said that wouldn't it be nice if we could just go to the appraiser and say "Can't you just give us $10k more?" He came back with that in the past they could, and that is partially what lead to the Housing Crisis people were mentioning above. Since 2007, the lender isn't allowed any contact with the appraiser, there is a dept in their bank (SunTrust) that deals with them solely. Now I understand that $10k on my place isn't going to cause the world to end, but you can see how lenders saying to appraisers, "give me X on this house or you won't work for me again" and the X being large, could lead to bad things.

In the end, since we are not financing what amounts to the closing costs, we will actually save more per month on the new loan, and with a skipped payment with the timing of the old and new loans, we will make up the amount we shelled out in about 6 months, so it will not be a big deal.

Zillow?

 

[cstu]

Why do they insist on comparing my 5 bedroom house to 4 bedroom houses that are 500-800 sq feet smaller

Lack of recent 5 bedroom sales of similar square footage in your neighborhood?

so i get the shaft bc people arent selling 5 br houses. there has to be a better way, no?

There's an appraising term called Conformity which refers to a property conforming to it's market. If you're in a neighborhood with all 4 bd homes that are smaller there's less value to the addition square footage.

However, appraisers are supposed to 'bracket' the square footage so there should be at least one comp in the appraisal that has a larger square footage than your home - even if it makes expanding the area and making location adjustments.

 

[cstu]

My best guess is somewhere in the 50-60% range for conforming.

The bank's have basically no influence now on the appraisal process via new laws/regulations. There use to be a lot of influence that banks could exert for higher appraisals both normal course of business kind of things and crossing the line type of things. Those are basically all gone now.

An appraisal is the appraisal. There is no pressure to make anyone happy. As long as the information is accurate and within the accepted appraisal business practices then there is not much more to do. Though, you can have two different people use the same info and come out with different valuations. I seem to remember hearing there being some sort of oversight now that if your appraisals were way off then you could get in trouble but that is very vague in my head so that could be totally off.

That's true and not true. It's not like the old days but there's is inherent influence because the bank's reviewer can make the appraiser's life hell if the appraisal doesn't come in at the sales price.

 

[cstu]

It all sounds like voodoo mixed with grifters. How hard can it be take the houses that sold in the past 6 months in your area find our the sq footage and bam your estimate. Homeowner be damned. bachelors degree for what?

Yep, that's all there is to it...

 

[Bob Loblaw]

I'm an appraiser. Granted, it's for a county assessor's office, so my focus is a little different than that of a fee appraiser, but still an appraiser. I do commercial properties now, but have a lot of experience with residential.

To OP, I think you just got a ####ty appraiser assigned to your appraisal. Too many inconsistencies, better comps than what were used, etc.

The purpose of the appraisal plays a role as well. If it's for financing purposes, then they'll come in more conservative. If it's for estate purposes, then it's usually higher than "financing" appraisals. If it's to substantiate a taxpayer's claim that their property's value is less than assessed value, then it's typically waaaay below market value.

For property tax purposes:

• bathroom count has more weight than bedroom count. The closer the ratio is 1:1 (bed:bath) the better.
• Pools add value but nowhere near the amount that was paid for construction. Sometimes the value added is negative, as the subject is in an area that gets little-to-no sun.
• we pay attention to the Principle of Regression (nicer home amongst crappier homes will drive down the value of the nicer home), and the Principle of Appreciation (a lesser home amongst nicer homes will drive up the value of the lesser home)

If you have any other questions, I'm here to help.

 

[culdeus]

I know in Dallas for tax purposes they are starting to more heavily value the lot and depreciate the home alot more aggressively. I can see the reasoning here. In a good school district a shack has value. The value is just the dirt and access to the school and area.

Same concept where you take X house in crap school area and drop it in a different part of town now it's worth $X more. It's not that hard to come up with lot valuation across a city in this way.

It's harder for some people to understand just how little value the actual structure has. I mean you blow it up and rebuild it from scratch it would cost a fortune, but the real value is far less.

I think you knock my house over the lot is probably worth $350k +/-25k or so. I feel like the house itself is fully depreciated. Probably on it's own not worth much anywhere else than where it is right now. I'm not sure where the line is drawn where the dirt is worth 50% of the total value. 20 years? 30 years? Longer?