From our Friends at Atlantic Bay Mortgage
Last month, we covered some of your most common appraisal questions---and this month, we've got even more! As always, I am available to discuss these and other scenarios in more detail.
Can my homebuyer dispute a low appraisal?
Atlantic Bay is happy to submit a reconsideration of value on behalf of the Borrower. Only the Borrower---our client---is able to request or approve a reconsideration.
The greatest success with reconsiderations comes from supplying the Appraiser with additional comps to consider (no more than three), though other things, such as gross living area (GLA) disputes, can be considered. The majority of the time there is no charge for a reconsideration, though if the Appraiser asks for one, or if they must revisit the property (as in a GLA dispute), then there would be a charge for this.
The borrower is not allowed to order a new appraisal if they disagree with the original; this is called "value shopping" and is not allowed. The only times a new appraisal can be ordered is if the loan type changes or if the Appraisal Department finds the original appraisal deficient (in which case we order a new appraisal at no cost to the borrower).
Because VA borrowers can only use a VA appraiser, if the appraisal is too low for the seller and the deal falls through, the veteran borrower may have fewer resources than civilians to move forward.
But if during the appraisal process the report appears not to be meeting the contracted sales price, the Appraiser must invoke the Tidewater Initiative prior to completing the report, requesting additional property details from the buyer and seller as a way to validate their price. I will then be notified to work with all involved parties---within two business days---to obtain comps to help support the value. Next, the Appraiser is given two business days for review and completion of the report. The appraisal will then be submitted to Atlantic Bay and will be reviewed by one of our staff appraisal reviewers, who will issue the Notice of Value (NOV). (Side note, it's called "Tidewater" because the pilot program was established right here in Hampton Roads!)
Are detached structures included in a VA termite inspection?
Yes, they are. Unlike other loan programs, VA loans require termite inspections, so if the Appraiser ascribes any value to a detached structure like a shed or barn, it must be included in the inspection.
If there is no value given to the structure, then it is not required to have the termite inspection; however, if it is given value, we cannot go back and ask that the value be removed so that the inspection is not required. We suggest stating in the contract if any structure is not to be included in value for this reason.
Thank you to our friend
for always providing expert advice for our clients!
Moving to Asheville or one of its surrounding communities? Or thinking of moving to the Upstate of South Carolina?
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