Appraisal Lower Than Selling Price

[randyj]

What is the name of your state?VA
We entered into a contract to purchase a new home for $675,000 and close Oct 14, 2005. Appraisal came in at $620,000. The appraiser calc. appraisal on 9 comps. even though bank only required 3. A $5,000 deposit was made to listing agent. The contractor is also the selling party. In the Purchase Price sect. of contract, listing agent checked that contract is contingent upon obtaining a conventional loan. He failed to complete any of the blanks for principal amt., %, etc. The financing paragraph that asks for a written committment from lender for the purchaser was left blank. It states, "if no date filled in, the date for shall be the same date set forth in the Settlement: Possession Date(closing date).
We upgraded 2 items for which contractor had purchased but had not installed: kitchen sink (his costs $75/ ours $288) and range (his costs $795/ours $1300). In addition, we had a separate oral contract for contractor to build detached garage. He estimated $15,000. We gave him $7,500 deposit. The bank would not loan the full asking price and we could not afford to pay the difference. Out closing attorney advised we write a letter to listing agent stating we wish to terminate contract based on financing contigency clause before closing date. We did. Listing agent is demanding to see the appraisal which we was ordered by the bank.
Seller now does not wish to refund any of our expenses or allow us to remove our range. The sink is installed and we are willing to forget that expense.
What about escrow, which listing agent does not wish to return, the deposit on the detached garage ( which contractor/seller plans to complete)? Aren't we entitled to these refunds?
This is a mess!!!!

[HomeGuru]

Originally Posted by randyj

What is the name of your state?VA
We entered into a contract to purchase a new home for $675,000 and close Oct 14, 2005. Appraisal came in at $620,000. The appraiser calc. appraisal on 9 comps. even though bank only required 3. A $5,000 deposit was made to listing agent. The contractor is also the selling party. In the Purchase Price sect. of contract, listing agent checked that contract is contingent upon obtaining a conventional loan. He failed to complete any of the blanks for principal amt., %, etc. The financing paragraph that asks for a written committment from lender for the purchaser was left blank. It states, "if no date filled in, the date for shall be the same date set forth in the Settlement: Possession Date(closing date).
We upgraded 2 items for which contractor had purchased but had not installed: kitchen sink (his costs $75/ ours $288) and range (his costs $795/ours $1300). In addition, we had a separate oral contract for contractor to build detached garage. He estimated $15,000. We gave him $7,500 deposit. The bank would not loan the full asking price and we could not afford to pay the difference. Out closing attorney advised we write a letter to listing agent stating we wish to terminate contract based on financing contigency clause before closing date. We did. Listing agent is demanding to see the appraisal which we was ordered by the bank.
Seller now does not wish to refund any of our expenses or allow us to remove our range. The sink is installed and we are willing to forget that expense.
What about escrow, which listing agent does not wish to return, the deposit on the detached garage ( which contractor/seller plans to complete)? Aren't we entitled to these refunds?
This is a mess!!!!

**A: and where is your Realtor?

[randyj]

Realtor works for a very prestigious agency but (at the age of 60) has only been in the real estate market for 9 months. He is trying to play the role of mediator, but is also related to the contractor/seller. After talking yesterday to the contractor/seller, and his refusal to refund any of the deposit made toward the detached garage, we have made an appointment w/ an attorney.
We were trying to see if anyone else has encountered a similar problem.

[pojo2]

Originally Posted by randyj

we have made an appointment w/ an attorney.

Good because someone would need to see all of your contracts to answer adequately.

[HomeGuru]

good answer**************....and adequate.

[Gadfly]

Isn't there a clause in the contract about the home appraising?

[HomeGuru]

Originally Posted by Gadfly

Isn't there a clause in the contract about the home appraising?

**A: of course not. That's why there is the problem.

[randyj]

Recently met with a real estate attorney. In the middle of reading the contract, he laughed. He stated that the listing agent/realtor dropped the ball......in our favor. Because he did such a poor job of writing the "Contract to Purchase", it will make our attorneys job easier. So, it should not be a problem getting reimbursed. But as you guys know, its not over till she sings.

Thanks for all of your correspondence!

Randy J

[HomeGuru]

Originally Posted by randyj

Recently met with a real estate attorney. In the middle of reading the contract, he laughed. He stated that the listing agent/realtor dropped the ball......in our favor. Because he did such a poor job of writing the "Contract to Purchase", it will make our attorneys job easier. So, it should not be a problem getting reimbursed. But as you guys know, its not over till she sings.

Thanks for all of your correspondence!

Randy J

**A: so post back when she sings.