There is a backlog of appraisals. REALTORS® across Texas are calling the Legal Hotline, asking what to do when the parties can’t get an appraisal completed—or even scheduled—before the closing date.
When deciding on a closing date, talk to your clients about the high demand for appraisers and suggest that they allow additional time for the appraisal. Building in extra days to close the transaction on the front end can save both parties headaches later.
When a contract has specific dates and appraisal doesn’t come in, the contract is still enforceable and the Earnest Money contractually will be forfeited if seller presses the issue. That is my understanding.
You might want to remind us to extend the “Approval for Financing” date as well or the buyers could lose their earnest money.
That is a separate paragraph. Paragraph 2A is the buyer financing approval and paragraph 2B is the “PROPERTY APPROVAL”. 2B does not have a number of days requirement, only 2A has that.
Even if we put extra time in the contract, generally, lenders and appraisers pick up those contract and put them in “work” order by closing date..so putting extra days won’t help
Advise Buyers to incur cost of appraisal and order as soon as possible when lender has been selected. Make certain your Buyer knows they will be responsible for the appraisal cost even if they don’t get approved.
Whenever a home owner or potential buyer applies for a loan, for a home purchase or refinance, they typically are requested by the lender to give their lender the application fee and appraisal fee before anything is done on their loan, the buyer already knows they already know will be responsible for the appraisal cost .
Why would you ever order an appraisal if you dont know if the buyer is approved?!
That is simply not good practice
I appreciate that there is a backlog, but I am seeing a 60 day delay in appraisals, and the fees often have a premium associated with them of 25 -30%. Anecdotally, we are also “hearing” that appraisers are performing desktop appraisals, without seeing the property, and I am also seeing posts with professional FB groups that appraisers are coming in from out of town to the Texas Hill Country, and the appraisals have been materially off from the CMAs. The hypothesis is that the appraiser(s) are lacking market knowledge, they may not be members of local MLS or other relevant… Read more »
I am a Realtor AND an Appraiser, the desktop appraisals being performed are ordered by the lender NOT the appraiser, the appraiser has no control over what type of appraisal gets ordered by the lender. As far as appraisals have been materially off from the CMAs, appraisals are WAY different than a CMA, appraisers use closed sales as the most consideration, appraisers do not really use active and pending sales when arriving at an opinion of value like most CMA’s do. If an appraiser does not have access to a local MLS, they should not be performing an appraisal in… Read more »
The Realtors need to be talking with the lender their client is using before writting a contract to find out when the lender can close the transaction!
Gone are the days of rushes!!!
At the company I work for, we are able to close most loans in 30 to 45 days.
Appraisals are taking 15 days solid.
Be sure that when writing a contract you should be sure NOT to forget to give the lender plenty of time on the approval of financing, this is extremely important!
Bottom line is always …. communication with your loan officer.