Incorrect FHA Appraisal?

[Michaela Manco]

Hello all,

I am under contract on a mixed use 3 unit property that I am acquiring with an FHA loan. About a month ago I was asked by my lender to submit a letter of intent for the property. My letter briefly described that I was intending to occupy one of the residential units, rent the 2nd residential unit and rent the 3rd commercial unit. My intentions were crystal clear to everyone from my realtor, the lender & even the listing agent overheard me talking about these plans during the initial showing and when I was at the property for the home inspection.

To my surprise, I was in for a shock today when the appraisal came back. While giving the appraiser access to the property the listing agent told the appraiser that the commercial unit and one of the residential units were going to be merged to make one larger unit. This was not my plan at all, I am using rental income from the other 2 units to help quality for the loan. The appraiser has written up the appraisal to reflect these "plans". Now my lender is diligently working to have the appraisal corrected. Has anybody had any luck having an FHA appraisal corrected? Do you have any tips for moving forward with this situation?

[Chris Mason]

Originally posted by @Michaela Manco:

While giving the appraiser access to the property the listing agent told the appraiser that the commercial unit and one of the residential units were going to be merged to make one larger unit. This was not my plan at all, I am using rental income from the other 2 units to help quality for the loan. The appraiser has written up the appraisal to reflect these "plans". Now my lender is diligently working to have the appraisal corrected. Has anybody had any luck having an FHA appraisal corrected? Do you have any tips for moving forward with this situation?

 I'd congratulate that real estate agent on passing their real estate exam and having their first escrow, and let them know that in the future they should not be allowed to host an appraisal without their supervising broker present to ensure the duct tape shutting their mouth is in place. If this actually happened as you presented (eg, if this isn't hearsay or a misrepresentation of events), holy smokes (NSFW, unless you work in a mortgage or real estate office).

As for what you can do... a good letter of explanation including mention that it wasn't even your agent that was making this random slander up (maybe they have another higher backup offer and are trying to sabotage?), and then I'd make a sacrifice or two to the real estate gods and hope your lender has a good relationship with the assigned underwriter, since generally underwriters view what the appraiser writes in the appraisal report as the Word of God as it pertains to the subject property. 

For the real estate agents here, if you're ever the buyer's agent and my appraiser calls you instead of the listing agent (which is the norm), this is a good example why, so don't give me too much flak about it. :P