Tip 5-2009: Appraisals

APPRAISALS: We are experiencing a sharp increase in the number of real estate contracts which are being terminated due to appraisal problems. Several lenders are now requiring urban comps within one mile, sales within 90 days, and sometimes other strict criteria. In a falling market, this can result in much lower appraisals. To make matters worse, on May 1, 2009 new rules are going to be enacted regarding the assignment of appraisers. Be prepared to defend the contract price, with pending sales unknown to the appraiser or in some cases, even changing lenders.