FHA Appraisals

[Mike Neyman]

Has anyone run into a situation where the first appraisal came in at the selling price, but the second appraisal came in below?

How is this discrepancy reconciled? Do they average the two or would you have to drop the sales price to the lower one?

[Ophelia Nicholson]

The guidelines say that if the second appraisal comes in lower than the first appraisal then the value of the second is used. If the second appraisal comes in higher than the first apprraisal then the value of the second is ignored and you go with lower- So you always go with the lower value. At that point the seller can decide to drop the price or cancel but be warned that with FHA the case number and the appraisal goes with the property not with the person buying so ifyou get a new buyer you will have to keep the same appraisals. Also if both appraisals have diffrent repair demands you have to fix both.