The Escrow is Closed

I waited until this sale was a "fait accompli" before writing about it. If you remember from an earlier post, this private townhouse sale was a win-win for all parties, and it seemed like smooth sailing until the closing date. The buyer was motivated and fully preapproved by her lender. The sellers were packing and had found the perfect rental property in the community of their choice, and the other agent and I made sure that all paperwork was in and completed.
And then the appraisal came in $90,000 under the selling price!
A reappraisal brought it up to $65,000 under, and a third, independent appraiser came up with the same figure. The obvious question is "why did this happen?" especially since all parties felt that the price was right on. The reason is that following the sub prime loan debacle, lenders and appraisers have a whole new set of rules. These include the number of comparable sales needed, the distance from the subject property, and how recently the other sales occurred. Because there were so few townhouse sales over the holiday season, the appraisers had to do some creative comparisons, adjusting the values of dissimilar properties.
What finally happened? The sellers reduced the price somewhat, the buyer came up with more cash, and we recorded today....a happy ending for some very nice people.
...and I received some beautiful roses from my clients!