Even With A Mortgage Approved, $ Down, A Contract & Motivated Parties-- What Could Go Wrong? Appraisal... Homes For Sale: Homes For Rent

Imagine you have a pre-approved mortgage for the buyer, a 20% down payment, contract and two parties that want to get the deal done at the set upon price-- what could possibly go wrong?

Well, the appraisal may not come back as hoped. Generally, lenders will finance only 80% of the appraised value. If the agreed upon price is $220,000 and the home appraises for $200,000, then we might have a problem.

The buyer would have to come up with another $20,000 more cash in the above example, the sellers would have to reduce the asking price by $20,000, or there would need to be some combination.

If the sellers stick to their price and the buyers cannot supply extra cash or refuse to come up with the extra money, the deal could die.

A lesson leared for both buyers and sellers.

My buyers and sellers know the market and are versed on the home. We know if the home is priced too high, the appraisal may not allow the deal to happen.

I only target those homes that make sense-- I leave the others to stagnate on the market. Either they will become realistic and come back to me or they will most likely be left on the market. Mis-priced homes and unrealistic expectations does not allow either party to acheive their respective goals.

For more information, please feel free to contact me. For free home searches and market data, please text me your name, e-mail address and phone number or visit my Web-site at www.langrealty.com/agents/michael-friedman

Michael Friedman
Realtor, Certified Distressed Property Expert (CDPE)
Member of Who's Who in Luxury Real Estate
Lang Realty
561-247-3550

Boca Raton FL real estate for sale and surrounding areas including real estate properties for sale in: Belle Glade, Boca Raton, Boynton Beach, Bryant, Canal Point, Dania, Deerfield Beach, Delray Beach, Fort Lauderdale, Hallandale, Hialeah, Hobe Sound, Hollywood, Indiantown, Jupiter, Key Biscayne, Lake Harbor, Lake Worth, Loxahatchee, Miami, Miami Beach, North Miami Beach, North Palm Beach, Opa Locka, Pahokee, Palm Beach, Palm Beach Gardens, Pembroke Pines, Pompano Beach, South Bay, West Palm Beach, Lang Realty

Real Estate Appraisals: What Sellers and Buyers Should Know

What some sellers and buyers do not understand is that a home appraisal can kill some deals.

Sellers must realize the home should be priced within a reasonable range of the appraised value. The reason is that a buyer may want to purchase the home at a higher price; however, the mortgage company may deny the loan based on the appraised value of the subject property.

Three common issues to be aware of as it relates to home valuation/appraisals:

1) In areas with many foreclosures and short sales, appraisers are sometimes left with little choice but to include them in the comparable analysis. This tends to reduce the appraised value of the subject property. Certain states that have a large number of distressed property sales, such as Florida, should be mindful of this.

2) Lower the credit score and/or the higher debt-to-income level, the greater the scrutiny of the colleral's value (i.e., home valuation). If there is some uncertainty, the extra focus on value could impact whether or not the lender approves the loan at the appraised value.

3) The fluctuations of the market can make some sellers apprehensive about selling at market value as they may start to believe the value will appreciate.

Sometimes sellers tend to want to get as much for the home as they can. And this is reasonable; however, it may wind up killing a deal when a lender is involved. On the other hand, some buyers fall in love with a home and are willing to pay more than fair value. If the buyers have "iffy" credit history or "just enough" to meet the loan-to-value requirements for a loan, they may be denied by their lender.

Please see some of our previous pieces on home and market valuations.

If you are looking to buy, sell, rent or invest in the South Florida real estate market, please feel free to contact me.

Michael Friedman
Realtor, Certified Distressed Property Expert (CDPE)
Lang Realty
561-989-2100

http://michaelfriedman.rmlsfl.mlxchange.com/?Page=7395217 <--property search link to cut and paste into your Web browser

Boca Raton FL real estate for sale and surrounding areas including real estate properties for sale in: Belle Glade, Boca Raton, Boynton Beach, Bryant, Canal Point, Dania, Deerfield Beach, Delray Beach, Fort Lauderdale, Hallandale, Hialeah, Hobe Sound, Hollywood, Indiantown, Jupiter, Key Biscayne, Lake Harbor, Lake Worth, Loxahatchee, Miami, Miami Beach, North Miami Beach, North Palm Beach, Opa Locka, Pahokee, Palm Beach, Palm Beach Gardens, Pembroke Pines, Pompano Beach, South Bay, West Palm Beach, Lang Realty