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I recently entered a purchase agreement, and after the appraisal process (which took 10 days), the appraiser effectively "quit" saying that they could not provide a value for the property.
The property in question had modifications done to two rooms and a garage (likely un-permitted work). The appraiser noted this in his report, and could not find the necessary permits for the work. Based on these circumstances, I do not want to buy a property that will only cause problems in the future since the modifications to the home were apparently un-permitted and illegal.
I had the real estate agent write an addendum to cancel the agreement, which the seller refuses to sign. He says that I have "cold feet" and wants to appeal to keep my earnest deposit. Furthermore, he now states that getting a second appraisal is not "sufficient performance".
What are my rights as a buyer? I do not want to purchase a lemon that will cause me headaches down the road. Will a second appraisal, and subsequent inspection fulfill my end of the agreement? I only wanted to avoid wasting everyone's time, since I fear that this will only unearth the same problems, but if need be, I will do it.
In the State of Georgia, Buyers have a "Due Diligence Period". It states that during "x" many days from Binding Agreement Date, the Buyer will do whatever they need to do to make a decision on purchasing or breaking the contract without penalty.
I would also ask your Buyer's Agent what does your state's Appraisal Contingency read in terms of an Appraiser not being able to determine the value of a property.
Your options as far as canceling depend on where you are in the process and how your contract is written. Read your contract and talk with your agent.
Is the seller willing to have the permit taken care of? It is possible to get one after the fact. It doesn't necessarily mean it wasn't built right just because it doesn't have a permit. It might just take the seller having someone look at it, OK it and then he pays money for a permit. If he can't get the permit, you can't get the appraisal or your loan and the deal will fall apart. And he likely will have the same issue again if he tries to sell it to someone else without taking care of this. Did the appraiser see anything wrong besides not being able to find the permit? If not, it may be worth seeing if the issue can be resolved.
Not all remodeling needs/requires a permit.
Just hire a new appraiser.
A reputable appraiser will not quit when something comes up or the going calls for more work than the Avg property or if they can't find all of the paperwork.
The seller has to take care of these permits "after the fact". And get the CO
The house cannot be purchased by anyone financing the purchase, as no CO, no mortgage.
Many people do not pull permits with their town because they do not want their taxes to go up.
In my market, when an appraiser finds no CO, they make note on their paperwork and leave.
IMHO this seller sounds like a real piece of work. It's not an FSBO is it?
By the way, the seller has not a leg to stand on.
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