Second Appraisal - Shopping for Loan?

[Andrew Flusche]

I'm a newbie to real estate investing and the forums, so I hope I'm following the rules...

I've got a contract on a single family home that was a flip. Sellers purchased it in July of this year, completely remodeled. Our contract price is much higher than the previous tax assessment.

We're doing a 30-year conventional loan with 20% down. They're doing a 4.125% rate with 2.125 points.

Our lender just told me that we're likely going to need a second appraisal because of the property's history, even though that wasn't in the fee estimate to begin with. Now I'm questioning my choice of lender, since this one was already a bit high on fees.

Does it sound normal to require a second appraisal for a conventional loan? Am I crazy to think that the lender should pay for it?

Is there a better place to take this loan?

Thanks!

[Charlie Fitzgerald]

Unless they are giving yout a considerable amount of lender credit for the points they are charging you for an already above par interest rate  (based on great credit, 20% down and 30 year loan), you are being taken.  As Upen mentions, there are limited instances when the guidelines call for 2 appraisals.  I do not believe this transaction fits that box, based on your information. I'd either call BS with the  current lender and tell them to get their numbers in line, or I would extend the contract and get a new lender.  If either of those don't happen, I'm walking.