Appraisal requiring repairs done in order to close a deal

By
Real Estate Agent with RMX REALTY

Appraisal requiring repairs done in order to close a deal

 

I have not heard of this requirement before but I have a situation on a shortsale where the appraiser required that in order for them to sign off on it, the 2 leaks in the bathroom must be done and that they will have to do an appraisal review in order to close. This is a short sale and the lender typically will do no repairs. The borrower on the other hand cannot get the loan docs unless the repairs are done. Problem is the borrower does not own the property yet so it does not make sense for them to proceed with the repairs. However, the borrower was willing to do the repairs but now the owner will not allow the borrower to send someone over to do the repairs until the property is officially closed. This is a catch 22 type situation. 

 

Has anyone encounter this dilemma? Now the owner and his agent had sent the borrower a Notice to Perform letter or else they will cancel escrow. This is a sticky situation now because of the several variables that are involved in this transaction that prevents it from closing escrow. The borrower was even willing to sign a waiver when doing the repairs but the owner even refused that option. Would the borrower be able to pursue 'specific performance' from the owner in this situation?

 

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Copyright © 2012 by DAVID DEE. All Rights Reserved. "Appraisal requiring repairs done in order to close a deal"

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Rainmaker
464,714
Bruce Hicks
Best Homes Hawaii - Honolulu, HI
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I came across a similar situation a few weeks ago.  In our case, it was more than a few leaks, but it was structural, 2 post and piers are wood rotted and need to be replaced.

Aug 24, 2012 05:31 PM #1
Rainmaker
302,191
Ken Brandon
Coldwell Banker Sea Coast Advantage (Jacksonville, NC) - Jacksonville, NC
Camp Lejeune, Jacksonville, NC

We have repairs called by appraisers regularly in our market. (It is primarily a VA loan market) So, I am not sure about the short sale situation and how that impacts the transaction, but we have had times where the buyer was OK with the "repair" not being done and the lender just had them sign off on a statement to that effect. Not sure a leak not being fixed would be looked on favorably by the lender though.

Aug 25, 2012 05:18 AM #2
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Rainmaker
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David Dee

Real Estate - San Gabriel Valley (L.A.) & N. Orang
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