Househunting - Appraisal question - Posted by DF (OK)

Posted by louise on March 06, 1999 at 17:26:37:

You can offer 60,000 the worst is they could say no.

Househunting - Appraisal question - Posted by DF (OK)

Posted by DF (OK) on March 06, 1999 at 24:12:20:

Upon househunting today I found an ad saying owner finance
2 story, 4BR 3 bath, home $87,000 with 7% interest.

When I called the lady said it was a fixer upper. That they had it sold but the couple who had agreed to finance it ended up getting a divorce. And that they had cut it 30,000.

So I went and looked at it and it doesn’t look like its worth $87,000.

We called back and talked with the lady again and she stated that it had been appraised at $100,000. Maybe when it was fixed up but not as it is. The thing is it will take more than the 13,000 difference to fix the place up the way it should be.

Can we have it re-appraised and then use our own appraisal to negotiate with the owner? Would this be viewed as hostile?

Re: Househunting - Appraisal question - Posted by rayrick

Posted by rayrick on March 09, 1999 at 12:04:42:

I’m not convinced you need quite as deep a discount as some of the other folks out there seem to think you do on this house. My standard caveat: I’m a newbie and may be full of sh**.

Keep in mind, the seller is financing, and at an attractive rate. This is always worth something. That means you can sell with owner financing, which makes your house much more attractive. You can easily jack the price up 5-10% above FMV, and get a quick sale to boot.

Of course, you still need to put the cash in for repairs, but you could probably borrow that money too. Heck, even at credit card rates, if you could buy at 75K at 7%, fix up for 13K (on borrowed money, at say 18%) and, if that 100K after fix-up appraisal is real, sell for 108K with 8K down and the balance at 10-11%, you’d be getting some cash flow, and setting yourself up for a solid back end profit. You could then refi after some seasoning to eliminate the high interest debt if you wanted. Just another possibility to consider…

How much cash do you need to put down? That would play a key role in whether or not you need to get cashed out immediately.


Re: Househunting - Appraisal question - Posted by Kevin OK

Posted by Kevin OK on March 06, 1999 at 22:27:54:

I’d ask to see the appraisal…and then draw my own conclusions. Sometimes the “appraisal” turns out to be a Realtor’s estimate of value…often made on the high end to secure a listing…Not what I’d put any stock in. If it was/is a true appraisal, I’d check the comparables used. I’d want to be sure of the value, especially on a “skinny” deal.

Re: Househunting - Appraisal question - Posted by lezlieTN

Posted by lezlieTN on March 06, 1999 at 07:40:54:

If you pay 87,000 and need at least 13,000 in repairs, where is the deal? You don’t make any profit. the appraisal is usually very close to fair market value. Pass this one up, or make a much lower offer. (say 60,000). Just my .02.

Re: Househunting - Appraisal question - Posted by DF (OK)

Posted by DF (OK) on March 06, 1999 at 13:13:54:

I agree totally, there is no deal with 87,000 + 13k in repairs, but I seriously doubt that the appraisal of it in the condition it was in fetched 87k much less 100.

The gentlemen selling it is a builder which says to me maybe he had a “friend” appraise it.