Home Appraisals & Contract Negotiations . . . What's in Your Contract?

Knowing your contract inside and out, and making sure your clients understand the offers they make as buyers, or the ones they are looking at as sellers, is critical.

This is excellent advice, Carla. The contract has specific verbiage which needs to be followed by all parties, and we are the consumers' representatives had better know what that verbiage is.

Many clients get confused about the appraisal process as they just remember from some years ago when it was the Wild, Wild, West and agents had control over appraisals. But you pointing the terms in the contract out to them, should do the trick for clients. ~ Marisa

So to be clear, no matter how badly an appraiser may go off course with a valuation for a home, the listing agent should just accept that as a value because your Portland contract doesn't explicitly provide the opportunity to appeal?  Where does the listing agent's fiduciary duty to get best terms for his/her clients fall into this scenario?  Depending on the type loan, the appraisal stays on file for months, so just voiding the contract doesn't make the problem with a "bad" appraisal go away. 

Taking the approach that no appeal is allowed may just cost the buyer the opportunity to buy the home they want and the seller the opportunity to sell at an acceptable price.

ToMAYto, toMAHto?

And I'm not suggesting badgering/harassing the appraiser, but if there's a clear error in the appraisal process, shouldn't that be fair game to ask for a correction?  I'm assuming that if an appraisal is low the appraisal is presented to the seller side to provide objective evidence that the appraisal is legitimately short?

We deal in many condo communities and what many fail to realize are the by-law rules and regulations. We suggest to READ it all before signing on the dotted line!

Liz and Bill Spear - in my area the appeal process is not part of the contract BUT, and that is a big BUT ... appeal is managed via the buyers agent and lender. The lender then initiates the appeal process. Most of the time appeals don't work here. What happens is the buyer goes to a new lender and gets another appraisal. That works 90% of the time from my experience. 

Carla Muss-Jacobs, Principal Broker/Owner - always, Always, ALWAYS we must read and understand the contract and march to the beat of the terms of the contract.  I don't know what the consequences would be if an agent stepped around it.  I've heard of appraisers threatening to report agents for doing just that. 

The only time the listing agent/sellers see an appraisal is if the property does not appraise and the buyers agree to share it...we have only had a glitch once...and the appraiser did miss a couple things ...we were only a $1000 apart.

Carla - you are the consummate professional buyers agent!  Good for you for spelling out all the details for buyers to understand appraisals, contract negotiations and more!

Good Morning Carla: In my area, there were instances when appraisers contacted me for comps for unique properties. They were not from the area. I have to provide him/her what I have as the the listing agent.

 I got to do what I got to do to assist to move the transaction forward.

With regard to home inspection, I don't call home inspector to nag or negate the findings but to shed more clarification when I find the report vague and unclear.

There is a line we draw but this line is imaginary. Our approach can spell the difference.

Carla, as an ethics instructor I always tell my agents that, once we have a contract we are bound by two things. The letter of the law and the letter of the documents. Anything outside that is engaging in the unauthorized practice of law and is a felony. Unfortunately I find by questioning in class and in transactions that many agents do not understand what they can and cannot do within the scope of their license.