My Landlord Stopped Making Mtg Pmts,he Says Bank Will Consid Short Sale. What % Of Tax Apprais Should I Offer?
ByThis hit out of nowhere, we have a lease on the house through next November and now he tells us that he can’t make his payments. He says that the bank will take a short sale due to the current real estate situation here in the Miami area but I don’t know if this is the case or not. The house is not worth what he paid for it, I know that for sure, he made a bad investment at the wrong time. He paid over 130K more than the current tax appraisal and the builder is still building new houses in the neighborhood at lower prices than when he bought two years ago. My biggest question now is how to evaluate the lowest legitamate price that the bank would accept given the current real estate conditions in the area. The only hard value that I currently have is the county tax appraisal. So, what percentage of the tax appraisal might the bank accept in a short sale situation? Or, is there a better way to evaluate the best price to offer?
Thanks
4 Comments
January 7th, 2010 at 8:53 am
Forget the county tax appraisal, it is meaningless in constructing an offer in this situation. See if you can find out how much he owes. Normally the threshold for lenders is about 88% of loan value. But abnormally in a declining market and with the other new construction factors you mentioned, I would get a good realtor involved to get you some comps. If he/she is good, they should be able to structure a good deal and receive a commission. Look for someone who has had short sale experience.
January 7th, 2010 at 11:25 am
Yes there is a better way to evaluate the worth of this property. The Tax Appraisal’s office value is always too high. They are just trying to “collect taxes” so they will establish values which I swear they find in the cracker jack box. Now, seriously, find a Real Estate agent that is willing to work for you. No, real estate agents don’t work for the BUYER they work for the SELLER. However, if you contact the local Miami Realtor Board they can provide you with names of agents who will take your business. That way the agent is your employee. He will look out for your welfare. After all if he does not, he doesn’t get paid, right? This agent, because of his license, has easy access to much more information, trends and appraisal information than you could get in a month of Sundays. Besides he knows where to look for such. You and I don’t. We have to search and peck and only hens get something worthwhile by pecking. Go hire a Real Estate Agent.
January 7th, 2010 at 4:04 pm
Yes, call a real estate agent (make sure they are working for you as a buyer’s agent). Have that person come over and evaluate the price of the house. This should also include looking at selling prices for comparable houses in the area.
January 7th, 2010 at 6:57 pm
The county tax assessment means nothing to a lender. However, you can get a full URAR appraisal of the house by a licensed appraiser and then offer the bank around 75%-80% of that value. They are likely to take it especially in the Miami area do to the greatly depressed housing market. Remember, banks are in business to lend money not own houses and then have to sell them at a loss.
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