New home appraisal less than selling price?

[Toogy]

Anyone have a mortgage lender appraise your new build for less than the agreed upon sale price from the builder?

My new house is currently being appraised and I'm waiting to hear the outcome, I honestly never knew this happened with new builds.

Thanks

[TKG26]

Woukd that be to calculate property taxes or reconstruction in the event of an insurance claim?

Not sure good question.. I'll stay tuned for the answer.

[Toogy]

It's the mortgage lender that ordered the appraisal... is this not common?

[Carlisle]

i am in the same boat. Our lender is requiring our house to be appraised when it is 97% complete.

If they apprise it for less that what we are paying the builder then we wont be able to get a mortgage with this lender, and have to settle with another lender at a higher rate....

[Toogy]

And our closing date is this Thursday!! Talk about stressing me out!

[Carlisle]

ours is april 9, and the house is only 70% done... they need it to be at least 97%....

[Toogy]

Well the appraisal came in fine, but now the mortgage lender want me to delay the closing a week!! I'm not sure I can take this stress any longer! lol

[Trepex]

Originally Posted by Toogy

Well the appraisal came in fine, but now the mortgage lender want me to delay the closing a week!! I'm not sure I can take this stress any longer! lol

Why do they want to delay closing?

I've heard of some lenders doing the appraisals in this market, and I think it's generally more common in cases where they are lending you a higher percentage of the overall value. Then again maybe some lenders are simply more likely to do it than others? Our first mortgage was with TD and we're with RBC for the new place - neither stipulated this as a requirement.

[oakvillehomeowner]

Originally Posted by Carlisle

i am in the same boat. Our lender is requiring our house to be appraised when it is 97% complete.

If they apprise it for less that what we are paying the builder then we wont be able to get a mortgage with this lender, and have to settle with another lender at a higher rate....

or you'll have to increase your downpayment to stay at the same ratio.

[good2know]

Originally Posted by Trepex

Why do they want to delay closing?

Ran in to this a few years back. House was not complete to satisfaction of the lender. We refused to sign to Tarion declaration (substantially complete and ready for occupancy). The occupancy permit could not be issued.

That generated some excitement with the builder

They were running around like ants for three days and got it all 'done'. Then we spent 8 months and over 30 days worth of trades visits to get it done 'properly'.