Appraisal after signed purchase agreement?

[momof5boys]

A question: A person buys a home, removes all subjects, and signs the purchase agreement. Then, three weeks prior to closing, the buyer's lawyer requests an appraisal on the home. First of all, why would a lawyer request an appraisal and secondly, if the appraisal comes in lower than the selling price of the home, can the buyer renegotiate with the seller?

[MortgageQueen]

No, not if the offer was firm with no conditions.
What may have happened, is the buyer's bank is requesting an appraisal prior to approving final financing.

[momof5boys]

No, not if the offer was firm with no conditions.
What may have happened, is the buyer's bank is requesting an appraisal prior to approving final financing.

But then wouldn't the bank ask for an appraisal....why a lawyer? Seems odd to me but maybe it isn't...not sure what to think.

[blueeyetea]

What is your lawyer saying?

If the appraisal comes in lower than the selling price, well, tough luck for the buyer, he/she already has already agreed to the price.

[momof5boys]

Update: It was an appraisal office (not a lawyer) that sent the appraiser. He came this morning - mentioned that our home is likely coming in at the selling price. He also said that the buyers are asking for this appraisal most likely for financing. Still seems odd to me that they didn't request an appraisal before signing.

[MillieH]

Sometimes nasty real estate sales people will do this.. I'm not quite sure how it works but if its appraised at below the value they could opt out.. My neighbour used to be a sales agent ,thats how he ended up on my street.. he tried to back out with the appraisal but it came in too high.. If you house price is on par with other houses in your area and in good condition, you shouldnt' have any probs at all.

[blueeyetea]

[QUOTE=MillieH;5734213]Sometimes nasty real estate sales people will do this.. I'm not quite sure how it works but if its appraised at below the value they could opt out.. QUOTE]

Only if it's a condition in the purchase agreement that the price can be revised pending an appraisal. Even if the the appraisal is a condition for them to get financing, if it's not spelled out in the purchase agreement, the buyer is on the hook for the price he agreed to.

That's the reason conditions are put in place when a buyer has doubts. It's to cover their butts to make sure they can back out of a deal if there's something wrong with the house or they can't get financing. Inspections, financing, selling the house they live in are the most common ones I know. What is common is for a seller's real estate agent to receive multiple offers and turn around and ask the buyers to sweeten their offer by removing any conditions. Definitely a buyer beware to go ahead with such a request.

[MortgageQueen]

I'm pretty sure the buyer's bank is requesting the appraisal. It's much more common now with tighter mortgage rules. If they had, had a broker in the first place, the broker wouldn't have allowed them to waive their financing until the appraisal was done. Unfortunately, people take the bank's "approval" at face value and assume all is fine, which is NOT the case. They still have to do their underwriting/due diligence. . .at which time, they may decide they want an appraisal.
A broker would have found that out up front.