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Re: appraisal contingency
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Home away from home
 
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I would keep the contingency clause in there - dont let the seller make demands that could end up screwing you over.
The unit we are buying didnt appraise for full sales price but thankfully we had the clause in the contract so at least had options if another solution couldnt be worked out.
Posted on: 2013/8/16 2:51
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Home away from home
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Cool. That works if you have on hand: 20% (or whatever your loan amount is) + 15K + closing costs.
Posted on: 2013/8/15 17:59
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Quite a regular
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we finalized appraisal contingency clause
so if it under appraises by > 15k, I'll have chance to renegotiate and walk away, otherwise I'll fill the gap with cash.
Posted on: 2013/8/15 17:37
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Re: appraisal contingency
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Home away from home
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Quote:
Honestly, the whole appraisal process is a load of crap. The bank makes a decision in advance based on current internal bank policy, a risk assessment for the area and very general market trends and then locates comps to justify it. The comps often aren't even very good choices relative to others that could be picked.
Posted on: 2013/8/15 17:35
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Quite a regular
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Quote:
what recent comps?
Posted on: 2013/8/15 17:16
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Home away from home
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You will definitely get a mortgage, the question is will a lender give you what you need. Have you asked your agent for recent comps?
Posted on: 2013/8/15 11:47
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Quite a regular
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Quote:
because I put 30% down, even if it appraises low I can still get a mortgage.
Posted on: 2013/8/14 22:37
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Home away from home
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Quote:
No. That's the whole point of waiving the appraisal contingency. If you can't get a mortgage for the full amount because it doesn't appraise, you are still on the hook and seller can take your deposit and perhaps sue you for the balance! I suppose that if you can't get a mortgage for some other reason, than the mortgage contingency provision would still apply. But I'd be concerned under those circumstances, where it didn't appraise, that Seller would still try to keep the deposit, and then you would have a legal dispute on your hands.
Posted on: 2013/8/14 20:08
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Home away from home
Joined:
2010/5/26 20:32 Last Login : 2023/9/14 15:34 From Hamilton Park
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If it appraises under what is expected and you could no longer get a mortgage wouldn't that just fix the issue, regardless of the appraisal contingency?
Posted on: 2013/8/14 19:05
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Home away from home
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Bubba,
It actually appraised over. The reason he had to remove the clause is because there was a stronger buyer in the picture. Meaning a buyer willing to place more cash off the bat on a transaction. Joe Grippi The Dale Fior Team Liberty Realty LLC 718-772-7952
Posted on: 2013/8/14 18:34
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Home away from home
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Quote:
Did the Hoboken condo appraise at or above the purchase price? Or did the buyers need to kick in additional $?
Posted on: 2013/8/14 16:37
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Home away from home
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Ultimately the decision is yours. If you are willing to face the possibility of an appraisal deficiency and be responsible for the difference that the lender is willing to give and what you will owe than you might be willing to exclude this from the contract. However if you may not be able to, or might not be willing than insist on keeping it in. Because the market is starting to tick up there might be instances where the lender will not value the property at its current market value, and this will kill the deal. Hoboken was seeing this happen a lot in late April into early June. People would have to come in 30 to 35 percent cash. Out of the last four deals that I have been a part of we only had to do this once. The one that did need the wave in the contract was in Hoboken, while the two that were located in the 07302 (Downtown JC) did not need a wave in the clause.
Joe Grippi The Dale Fior Team Liberty Realty LLC 718-772-7952
Posted on: 2013/8/14 15:57
Edited by JoeGee on 2013/8/14 16:23:35
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Re: appraisal contingency
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Home away from home
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I have heard it's becoming more common for sellers to demand this in the downtown area as well. I suppose it's a sign that the real estate market is picking up.
Posted on: 2013/8/14 15:27
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Re: appraisal contingency
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Quite a regular
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Thank you for the replies. Actually I already allowed appraisal contingency modified to allow for 10k below appraisal.
Will insist on the clause. THanks again.
Posted on: 2013/8/14 2:36
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Re: appraisal contingency
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Home away from home
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I would never do that. just say no. What will you do if it doesn't appraise? Do you have the funds to make up the difference? if not, its a no go.
Posted on: 2013/8/14 1:29
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Home away from home
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That seems like a major red flag...the seller expects it to appraise low and wants you locked in. Not a risk I would personally take because all the evidence in front of me would be saying "the condo isn't worth this." I mean, what if it appraises significantly lower than even the seller expects (i.e., even with your 30% downpayment, you still might have to put in more to avoid mortgage insurance)?
Posted on: 2013/8/14 0:34
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Re: appraisal contingency
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Home away from home
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Ask yourself if you're willing to risk and lose your money / shirt on this? If the answer is no, then protect yourself and ask for the contingency clause and be prepared to walk away.
I always take the viewpoint that it's my hard earned money, and I'll do everything I can to protect it (and myself). No apartment is worth the risk between me and my money 
Posted on: 2013/8/14 0:02
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Re: appraisal contingency
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Home away from home
Joined:
2010/7/7 17:29 Last Login : 2023/11/10 14:36 From Downtown Jersey City
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Don't even think about it. Say no. You always have to be willing to walk away. Just ask yourself why they would want that contingency removed.
Posted on: 2013/8/13 23:51
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Re: appraisal contingency
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Quite a regular
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Quote:
we are currently in attorney review. Point of disagreement is regarding appraisal contingency. Our lawyer wants it, seller's wants to remove it. we already put 30% down on contract. Also we offered full listing.
Posted on: 2013/8/13 23:49
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Re: appraisal contingency
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Home away from home
Joined:
2007/7/4 16:37 Last Login : 2021/11/4 21:55 From Hamilton Park
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Implications: a) put more $$$ down or; b) change bank with the hope that a new appraisal may prove higher. The seller has all motivation to sell his/her property but he/she can not force the bank to "remove the appraisal contingency". If you do this on your behalf (and on your behalf only) it will not impact your ability to get a loan and you may find yourself liable to lose your deposit so I would not do that.
Posted on: 2013/8/13 23:42
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appraisal contingency
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Quite a regular
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buying a condo in journal square area. seller insists on removing appraisal contingency. place is fully renovated but priced about 10% higher than market. I want the condo what should I do?
Posted on: 2013/8/13 23:25
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