Posted by Matt (MPD) IL on April 12, 2004 at 10:03:01:
Did you ask your agent why they changed their numbers? This sounds a bit confusing to me. Any agent knows that comps and fair market price should be the same thing… it’s exactly what you’re looking for when you pull comps. You look up comparable property that has sold recently in close proximity to the subject house. Adjustments are made for different variances such as age, state of repair, desirability etc., if you can’t find something exact (which is usually impossible). When you have 5 or 6 comparable homes and their selling prices you should have a clear indicator of the fair market price for your subject.
Are you working with a mortgage broker or your own bank? Is it a mortgage broker that was referred to you by the agent?
i have my first deal under contract, financing lined up and everything ready to roll until my realtor says that my fair market analysis comes in at 125k instead of the 150k that i based my deal on!!! the bank said the would need the fair market analysis in order to move forward with the loan.
my question is how does the fair market analysis differ from comps? this same realtor pulled me recent comps when i first had an interest in the house and the numbers supported 150k if not more, with a price of 70 bucks per sq ft. according to the fair market analysis the house is only worth 50-something bucks per sq ft. another thing is the 125k is also the taxed assessed value, and i know that for the most part homes do sell for more than the tax assessed value. and this house is in a very desirable neighborhood, across the street from a lake, and in a good school district.
what is the difference between the two. is the bank expecting the FMA to come in lower than the 150k i told them the house is worth??
Will the bank accept an appraisal if you have one? Usually they
won’t make a loan without one in these parts.
We generally get an appraisal done, then put it in our loan
package when shopping for a lender. If they don’t want to accept
the appraisal we had done, we find a lender that will. You have to
position yourself to control these key elements of your deals.
Fun, huh? You need a lot of good experienced, reliable people on
your investment team. RE attorney, CPA, appraisor, loan broker,
realtor, escrow and title agent, etc. Avoid surprises…as much as
possible! : ]