What now? In this HOT real estate market, this is a question buyers and sellers are asking.
When a buyer gets a mortgage loan, the lender usually requires an
appraisal so they can be sure they are not loaning more than they can
recover if the buyer defaults. That appraisal is based on several
factors and calculations and is the last word on the homes current
value.
After the contract has been accepted and receipted and the appraisal
comes back for a value less than the contract price; what happens? The
buyer has three options:
1. The buyer can accept the home at the original agreed upon price
but must make up the difference between the contract price and the
appraised value in cash.
2. The buyer can terminate the contract and in most cases in Texas receive his/her earnest money back.
3. The buyer can negotiate with the seller to reach a compromise
split determining a new price and the buyer will have to come up with
that difference in cash.
In times past, the seller would have to come down to the appraised
value because no one would buy his home for more than value but in
today's market in the Austin area, there is a line of people waiting to
buy any property and if this buyer doesn't want to pay more, someone
else will.
Austin, Texas. Robin Scott, BROKER. Certified Residential Specialist, Accredited Buyer's Representative, Seller's Representative Specialist. 512.589.7988.
Search for homes through Austin MLS
Find your home's value
Buying or selling? Hire an experienced professional. Call Robin Scott, Broker at 512.589.7988.
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