You found a JUICER! (At least that’s what we call them in my office.) As for “leaning” on him to do it again, the good news is that if he’s truely a juicer, and from what you said it sounds like he may well be, then you won’t need to do much leaning to get the value. Typically if an appraiser is a juicer they usually look to the client for direction when “looking for” a value. Their mindset is completely backward from what an appraiser should be doing. (Appraisers are bound by USPAP to be unbiased and “not to favor the cause of the client”.) The bad news is that this doesn’t necessarily help you the investor in the long term. You have already seen the down side of a juiced appraisal, you borrow more than the property is worth and are now stuck with it. This limits your options with that property even though you are able to benefit from an increased cash out in the loan for the short term. It’s really up to you but I’d be careful using this strategy in the long term.
Regarding my last post, I re-read it and it came off a bit rude. That’s not how I intended it, sorry about that.
I recently refinanced a rental property and pulled out some equity. Now I find that the appraiser inflated the value by $50,000 by using comps that weren’t really comparable. (Their value is in their land.) Now I can’t sell the place because I’d take a loss on it.
It was the lender’s appraiser. Do I have any recourse as far as damages? This has put me in a very difficult position financially.
I hate to say it but as for recourse that is going to net you any $ to cover your losses I’d doubt it. The legal forum may put you in touch with somebody closer to an expert than I am on this although this seems pretty much off the beaten path for most attorneys I know.
My question is how, as an experienced investor, did you not know better when you signed the papers to pull the equity out in the first place? $50,000 is a big difference.
I’m NOT an experienced investor. This is one of those “expensive” seminars I’ve heard so much about. I didn’t really want to sell it anyway and now I’m thinking I might use the same appraiser again. I have another property that I need to appraise high. Do you think I could “lean” on him due to the false appraisal last time? Thanks of your input.