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Who is to BLAME when an Appraisal goes bad?

By
Real Estate Broker/Owner with Godzyk Real Estate Services NH License 033394

The Loan Officer tells the Buyer "there is enough blame to go around for everyone". Frankly, it offended the Buyer more than comforted them. See, right before a closing on a Manchester NH area Home, the appraisal was deemed "FAILED".

 

What failed is my question? The appraiser wrote "that the home needs a new electrical system as no basement lights worked." It sounded extreme and expensive. But wait, the appraisal was done 30 days ago. It is VA and there was a small list of repairs needed. There was painting a couple of exterior areas with peeling paint and installing a hand rail. There was no mention of electrical systems?

 

 

What happened since the appraisal? The home was occupied by the seller. The electric worked just fine they said. The seller moved out on the weekend and met me on the Monday to do a walk though before the buyer came. We also were to meet for the final inspection by the appraiser to show the exterior paint and hand rail was done.

 

I showed the appraiser the exterior areas all completed and walked inside to show her the hand rail. The appraiser sat on the stairs and reviewed her pictures. Somewhere as i went into the kitchen with the seller. The appraiser wandered down stairs. The light switch did not work. Got to the bottom, the light switch did not work. She says good bye, does not mention any issues and then leaves. In an "unknown and unreasoned" action, reports the basement electric is broken and needs full replacement. 

 

Fast forward the underwriter reads and fails the inspection, halting the sale until a full electrical replacement is complete???

 

It took an act of congress to get this information, but I was focused on getting to the bottom of this and fixing it. It seems the seller hired an electrician to install a ceiling fan the buyer showed the seller they would install in what would be his office. The electrician left the circuit breaker off. 

 

In what needed to be written in triplicate and stamped by the electrician, this simple explanation was sent into the under writer. OH NO, they want the appraiser to go back and check to make sure the work is completed. There is no work, the circuit breaker was off. AND WHY was the appraiser in the basement when there was no repairs to be completed there???? 

 

In the next week, we got the mortgage companies manager to take over for the loan officer who was still assigning blame and not helping one bit. The appraiser agreed to comeback and waive her trip fee. Her pictures matched the 24 pictures of working lights i sent in and we got the clear to close. 

 

"You know, had there been any other listing agent, this deal would have been long dead" says the branch manager at closing. The buyer looked at the seller who looked back at them as the buyer spun around to the branch manager and bashed the loan officer for blaming everyone and offering zero options or help. The closing lawyer whose mouth was open hearing this, looked at me and said "It is a good thing they had you Mr. Godzyk, as no one gets these deals to work like you."

 

With a smile, they buyer and seller got back to signing.

  

The buyer and Seller were very happy. They paraphrased my infamous saying that any Buyer or seller should take the time to hire the BEST not just the biggest. By using a philosophy, which is simple, to provide more personal and professional service to guide my clients through each step of the buying or selling process, I can help you find your dream home or sell your property. Your agent can stand behind you and assist with obstacles such as this.

 

The moral of the story is All Agents are not created equal and every buyer or seller should take the time to hire the BEST not just the biggest. By using a philosophy, which is simple, to provide more personal and professional service to guide my clients through each step of the buying or selling process, I can help you find your dream home or sell your property. Your agent can stand behind you and assist with obstacles such as this.

 

    

                                 

 

To CONTACT Scott Godzyk please call 603.661.2121 or EMAIL: Sctprop@aol.com .

 

  

About the Author: Scott Godzyk is the Owner/Broker of the Godzyk Real Estate Services in Manchester NH. Proud to be locally owned and operated with 30 years of experience, Scott is a leading Agent for Listing and Selling Homes in this area.We are Full Time Agents ready to serve all of your Real Estate needs. Servicing Hillsborough, Rockingham, Merrimack and Belknap counties. 

 

You can search for Manchester area Homes For Sale by clicking here. what is for sale by clicking here.

 

 

Comments (22)

Raymond E. Camp
Ontario, NY

Good morning Scott,

Too many think they are the expert's ad do not do what is expected of them!

At least you had a good attorney.

Make yourself an astonishing day.

Feb 21, 2017 06:05 AM
Barbara Todaro
RE/MAX Executive Realty - Happily Retired - Franklin, MA
Previously Affiliated with The Todaro Team

Good morning, Scott Godzyk the bottom line is that's what happens when one person within the chain is incompetent.... 

Feb 21, 2017 06:07 AM
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

It never ceases to amaze me Sally K. & David L. Hanson , another reason why they need to over haul how appraisers are assigned to orders

Feb 21, 2017 06:36 AM
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

Exactly Raymond E. Camp  WIth appraisers i think there is such an over kill from all the bad appraisals done in eary 2000

Feb 21, 2017 06:38 AM
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

The worst thing was even if the appraiser would have asked why dont the lights work? instead she nearly kills a sale for no reason. I do love that saying Doug Dawes 

Feb 21, 2017 06:39 AM
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

That is exactly it Barbara Todaro , i dont take things laying down and no way i was letting this go. The seller had their new home to buy after this and i was fixing this

Feb 21, 2017 06:41 AM
Myrl Jeffcoat
Sacramento, CA
Greater Sacramento Realtor - Retired

Perhaps we need to coin a new quote, "A transaction is only as good as the weakest link in the chain!"

Feb 21, 2017 09:23 AM
Belinda Spillman
Aspen Lane Real Estate Colorful Colorado - Aurora, CO
Colorado Living!

OK that was brain damage.  Don't you wish you could drag the underwriter over there to show her how everything is working just fine?

Feb 21, 2017 10:29 AM
Nina Hollander, Broker
Coldwell Banker Realty - Charlotte, NC
Your Greater Charlotte Realtor

All I can say, Scott, is thank heavens I've never run into such an extreme situation.

Feb 21, 2017 10:35 AM
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

I never understand these types of stories, Scott Godzyk ... and why any mortgage originator would take this stance.  Most LOs don't get paid if they don't get the loan successfully CLOSED.  You'd think that fact alone would motivate them to find some sort of positive solution, even if nothing else did .... say like doing the right thing by their client(s) .. referral partners.  

Not even going to mention how lame it was that the appraiser didn't check the breaker prior to reporting that electrical work needed to be completed.   Wow ...

Thankfully, your client was being represented by someone with common sense ... and gumption ... and a true advocate ...

Gene

 

Feb 21, 2017 11:38 AM
Chris Ann Cleland
Long and Foster Real Estate - Gainesville, VA
Associate Broker, Bristow, VA

I haven't had an appraisal with lender required repairs ever...and I hope I never do.  

Feb 21, 2017 11:38 AM
Anna "Banana" Kruchten
HomeSmart Real Estate - Phoenix, AZ
602-380-4886

Scott I've been down this road a few time and it clear no appraiser wants 'egg' on their face and some get stoned faced and difficult. But there is always (almost always) a solution. We just have to find it - like you did.  Why in heavens name she didn't mention anything or ask the seller about why the light switch wasn't working. But even more strange is concluding that all the electrical in the basement needed to be re-done.  Beyond nuts and then some.....

Feb 21, 2017 01:05 PM
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

That is how i felt Anna Banana Kruchten and just crazy assumption to not have even asked

Feb 21, 2017 01:08 PM
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

I had 1 in December and 2 in January, before that it could have been 7 years Chris Ann Cleland 

Feb 21, 2017 01:09 PM
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi that is what i told the manager, the LO's job is to assist the buyer getting the loan closed, not hinder it 

Feb 21, 2017 01:10 PM
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

And hope no one else ever has to  Nina Hollander. it was wild and crazy, but done 

Feb 21, 2017 01:11 PM
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

Yes, i think it should be required Belinda Spillman . Loan officers, appraisers, asset managers , valuation people should all have to be in a real house and see real things so they have real knowledge and dont follow a black and white script written by someone who also may have no experience with what they are making decisions over. 

Feb 21, 2017 01:13 PM
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

Tht it is Myrl Jeffcoat 

Feb 21, 2017 01:14 PM
Dick Greenberg
New Paradigm Partners LLC - Fort Collins, CO
Northern Colorado Residential Real Estate

Hi Scott - Obviously that never should have happened, and lucky for everyone involved that you were on the case and persisted in making it work. Very nice job!

Feb 21, 2017 01:16 PM
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

I was happy we were able to work things out. Some may have given up and ran Dick

Mar 14, 2017 03:15 PM