Imagine the agony of a buyer when the bank's appraiser rules that the apartment the buyer has agreed to pay $750,000 for is worth only $650,000.
The buyer has three options move on, because the low appraisal means the mortgage the bank will give is too small to buy the apartment; scramble to come up with a larger down payment to make up for the smaller loan or use the appraisal to try to renegotiate the price.
Real estate agents, mortgage brokers and appraisers all say that the low ball appraisal has become increasingly common in today's unsettled market.
The problem is even more pronounced when homeowners are hoping to refinance a mortgage or get a home equity loan, because there is no agreed upon sale price as a benchmark, they say....