All Forum Posts by: Kathryn Bowden

I have two offers on my property coming in, and was wondering if people have experiences (good or bad) with the banks that would provide the mortgage to these buyers.

Both are pre-approved.  Buyer #1 will get their mortgage with US Bank.  Buyer #2 is using a mortgage broker and going through a lesser traditional type of lender.  Buyer #2 needed to go this route because their traditional bank wouldn't pre-approve them for quite enough (though their income doubled in 2017 from 2016) because they haven't filed their tax return yet for 2017 (obviously).

We own a rural property, which has all the things banks can give you a hard time for (well, septic, mnfd home, etc.).  Since Buyer #2 is going with a less traditional lender that is more lenient with their self-employed status, my theory is that perhaps they will be also more lenient with the whole underwriting process.  Has anyone found this to be true?  Also, how do people experience the underwriting process with US Bank?

Obviously there's no guarantees, but I'm just wondering with all things being equal, what might be the best shot for a successful closing with the least amount of pain.

Thanks, @Jennifer Z..  I've heard that as well!  I just don't get it.  People need jobs - I don't understand why there has to be a shortage of appraisers.  I don't get the system behind it that causes that situation.  And the reason I'm thinking ahead is because I too ran into a problem with an appraisal on an investment place we have up in Gold Beach just a month or so ago.  We had multiple offers, but they appraised it a fair percentage lower - $140,000 on a $150,000 contract (originally had offers for $155,000).  However, our place was a stretch on the price per sq foot, but that's because it's a tiny cottage and there are no comps at that size.  We gave them our reasoning and comps (also our's was way nicer finish out), but they didn't budge.  Our Brookings place should be much easier to justify, but since I was burned once, now I don't trust the process.  Yes, we would definitely dispute it , especially depending on what comps they were to use.  But hopefully that won't be necessary!  All feedback from realtors has been very good on price, and my comps justify it, at least in my unprofessional opinion.

@Jacob Wathen, thanks so much.  So, if the appraiser were to start with 1-10 acres, would he/she then broaden their search even if they've found similar properties, but just wasn't able to get to the value of my offer/contract?  Does that make sense?  My property has five acres.  Most of the comps are at one acre, but otherwise similar.  But the comps I like the most are in the 11-16 acre range.  Very similar in every other way and did sell for more than I'm asking.  Though I don't know how much might get attributed to the extra acreage.  If too much, then I might be better off with the lesser acreage ones! 

We are selling our home on five acres (4.97), and will be entering into a contract shortly (if all goes as planned).  My question is when the appraisal is done, is there a standard of the comps they pull on the range of acreage.  Btw, this will be a conventional loan.  For example, would they only pull 1-10 acres; or up to 5 acres; or anything over 1 or 2 acres, etc.  An important note is that this is a small town, so there isn't a ton of comps.  So in my opinion, the broader the search the better a picture it gives on our value.  Otherwise it could be skewed, and maybe not in our favor.  When I look at the comps, I pull up 1+ acres with mnfd home, because there's only a handful above maybe 2 or 3 acres.  A couple of the best ones for us are more like 12 - 16 acres.  They sold for more than we are asking, but I think they're really good comps, as one is right up the street from us, and just very similar in every other way besides less acreage.  I'm worried that the appraiser would just pull up some formula that would leave out these important comps.  Is there a standard for this?  I'm in Oregon if that makes any difference.  I am worried, as I had a bad experience with an appraisal recently on another house, which was a first.  Also, people around here seem to complain about the appraisers.  Thanks for your insight.

@Ben Winchester, very interesting - thanks for your reply.  I just took a closer look at the contract.  I have seen that financing clause before and haven't liked it - that if buyer can't get financing, earnest money goes back to buyer.  Of course, I guess I do like it if I'm the buyer.  :-)  But it states that the buyer AND property must qualify by lender (property at agreed price), and if not, and we're not able to agree to new terms, then buyer can walk away from contract with EM.  That says to me (in my unprofessional opinion), that regardless of us coming 100% down to the appraised value, that he could say he changes his mind, and still get his EM back.  Where my realtor came up with something otherwise, I don't know.  However, she is the professional and maybe there's something I don't understand to do with Oregon law (?).  She told me that I should get the full EM if we offer to come down to that appraised price with no other changes to the contract (which we essentially did because she didn't even get to the credit change part of our offer - she only verbally left a message that we would come down 100% to appraised value - also btw, she is representing both of us!).  But I suspect he might have had a leg to stand on if he demanded his EM back in this situation.  Instead, realtor told him at that point that we offered to split the EM with him if he wanted out of the contract, which he accepted - we wanted to start with that incentive, as he had been dragging his feet.  This is a small town area, and I don't think a lot of buyers would necessarily have the same experience as in the big city.  Our realtor is the top producer in this county, so she's no slouch. 

Also, since you live in the NW as we do, you gave me some hope now that we are going into the winter.  It's nice to possibly see light at the end of the tunnel if we hold on to this place till the Spring.  We are thinking of furnishing it and making it into a temporary rental.  We are hoping that this might ultimately pay off in either a short or medium term.  Any additional thoughts of the Oregon markets?  It's very disheartening to have our place held up for months.

Update:  We terminated the contract today and split the earnest money.  Very relieved to have it behind us so we can move on.  Thanks everybody for the input.

@Christine Kankowski, that seemed to be what my realtor said on the EM.  Yes, she presented the appraiser with comps and the fact that there had been multiple offers.  The highest comp hadn't closed yet though, which we don't know if she took into account (it has closed now).  Even with the highest appraisal, ours' would still be a higher price per sq ft.  It's a very small house at 600 sq ft.  Prices have also been generally going up in the area (but not super hot - it's a small town). 

That all makes total sense.  I'm getting irritated because he seems to be dragging his feet, which is only holding us up at this point.  I think our realtor only left that offer as a verbal offer on his voice mail.  I've left a message with her this morning that I want to sign a termination of contract by noon if we haven't heard back.

But how does that apply to the earnest money?  And even if I left the credit in, you are still changing the contract by changing the price, aren't you?

We have a house we are selling with a realtor. We entered into a contract with a buyer for $151,000 with $1,000 credit back on closing costs with a VA loan. Our appraisal came in at $140,000, which was very disappointing, especially considering we were in a multiple offer situation. :-( At first we agreed to split the difference with the buyer coming up with the cash. He had a chance to talk with his friends over the weekend, and decided he changed his mind and wouldn't pay a penny over the appraised price. We ended up offering him the $140,000 price, but without his $1,000 credit (the realtor also gave back 2% to us, and we really felt we just need to move on with this sale). He is dragging his feet on agreeing to this, which should be a no-brainer in my opinion if he wants the house - so us and realtor believe he must have cooled on the house. Our realtor says we would not get the earnest money in this case if he backs out because we are changing the contract with removing the $1,000 credit. She is probably correct, but do other professionals out there agree with this assessment?