How much was your earnest money deposit???

[Margery]

I have been in this business over 13 years and I have never advised a buyer to waive an appraisal contingency, no matter what the market. If there is no contingency and the house appraises for under the sales price the buyer has to come up with the difference because the lender is going to loan a percentage of the appraised value, not a percentage of the sales price. I also have never advised a buyer to waive the home inspection even in the feeding frenzy of the recent past.

[gnu]

Originally Posted by bangorme

And a brain transplant $500,000, because that's what anyone would need that would buy a house without having it inspected and appraised before hand.

There's no need to have such a smarmy attitude.

I'm looking at foreclosed properties in the $100,000 range. They are all sold as-is, so a home inspection would make no difference, and at that price range, I know the properties are being sold well below normal market value; thus it would be irrelevant for me to get an appraisal. Between getting the house and not getting the house, I'm willing to bear the slight risk because the dollar amounts I am risking, on a ~$100,000 property, are more or less negligible.

[bangorme]

Originally Posted by gnu

There's no need to have such a smarmy attitude.

I'm looking at foreclosed properties in the $100,000 range. They are all sold as-is, so a home inspection would make no difference, and at that price range, I know the properties are being sold well below normal market value; thus it would be irrelevant for me to get an appraisal. Between getting the house and not getting the house, I'm willing to bear the slight risk because the dollar amounts I am risking, on a ~$100,000 property, are more or less negligible.

It's a joke, get a sense of humor transplant lol.

I purchased a foreclosed house and put 65% of the price of it into refurbing it. Fortunately I had the house inspected by a structural engineer beforehand so I knew what I was getting into. It could have been half that or twice that, but if you've got the money and don't care, go for it. Otherwise it's probably best to make an informed decision.

[frogbiscuit]

IMHO, the earnest money thing is total BS. A few years ago we sold our house and the buyer couldn't get financing because he lied on his credit app. They thought they deserved the earnest money back, I refused to sign off on it, got a lawyer, their lawyer got 1/6, they got 1/6, I got 1/3 and my lawyer got 1/3, only after we filed suit.

[car54]

Originally Posted by frogbiscuit

IMHO, the earnest money thing is total BS. A few years ago we sold our house and the buyer couldn't get financing because he lied on his credit app. They thought they deserved the earnest money back, I refused to sign off on it, got a lawyer, their lawyer got 1/6, they got 1/6, I got 1/3 and my lawyer got 1/3, only after we filed suit.

EXACTLY!

I've sold over 30 houses in my life and I have never tried to keep an EMD after a buyer backed out....just not worth the hassle.

[horseplayer]

But so many transactions are REO. They may even want more. I bought from WFC Asset Management, and gave them 1500 on a 35K purchase. They would have gone after it, for sure. But, they allow for their own way out. The contract you present them is not going to be the final contract. They will have their own, and if you want them to pay closing costs; it will be their choice of title cos..

[oneasterisk]

Originally Posted by bangorme

I am referring to the quoted portion in my message and trying to say that the realtor that advised Gnu to agree to "removal of financial/appraisal contingencies " was out of their mind. In today's housing market, you would be taking a tremendous risk to plunk down 2% and agree to not require an appraisal stipulation. Which btw, I would precede with an inspection of the property. Your $700,000 house would appraise for about $450,000 if it is mold infested.

Ahhhhh ok I'm with ya now! Yeah I don't care what market it is, waiving an appraisal and/financing contingency is nuts. Also I don't give too much credit to appraisals. Those same appraisers said the foreclosed house on the market for $120k, was worth $390k 3 years ago. They may be a little more conservative on their prices these days, but who really has any oversight on them?

Wouldn't you still have to pay for the appraisal if you are getting a loan from a bank for the house? The bank won't finance the loan if the house doesn't appriase for the purchase price right? If appraisal comes lower, wouldn't you have to bring money to the table to close the deal? I'm no expert, just thinking out loud...

[horseplayer]

Last year, I was selling in a market, where the appraisers were employees of the bank. It seemed to work a little better. Banks certainly gave better treatment to preferred risks, but the system was not susceptible to wholesale fraud.

[cubbluey]

We've been doing 1% of purchase price. Anymore than that will give you the upper hand if there is another offer that is close in price. You can always cancel the sale and void the check.
Once you get a ratified contract (i.e., all parties agree to all terms of the contract), then you submit a real check or transfer by wire to MBH Settlement Group LC who will hold the funds in a trust account. There are 3 good opportunities to void the contract after ratification: (1) After the Home Inspection and Radon Testing, you can void the contract if you wish and the earnest money deposit would be returned to you - - you do not even have to tell the Sellers why you are voiding the contract. (2) IF the Appraisal comes in lower than the contract price and the Seller refuses to lower the contract price, you can void the contract if you wish and the earnest money deposit would be returned to you. and (3) If your financing fails to come thru, you can void the contract and the earnest money deposit would be returned to you. In each of these instances, we have a limited time in which to void the contract and we have to prepare paperwork that informs the Sellers that you are voiding the contract and want the earnest money deposit returned to you. IF you do not take advantage of one of these opportunities to void the contract, you may run into difficulty in getting the earnest money deposit returned.