When you sell your home traditionally the buyer will pay for an appraisal. This lets their lender know that the house is worth the amount they are getting the loan for. A good timely appraisal is a must when selling your house fast in Tulsa County. Some Tulsa real estate appraisers are more conservative and some not so much. If an appraiser doesn’t do a good job they can get their numbers way off. If the appraisal comes in too low it can give the buyer a legal way to exit the contract and get their earnest money back if the seller won’t come down on price.
Here is a perfect example that happened to one of my personal properties that shows how this process can be manipulated. After I fixed it up and listed it we got an offer within a couple weeks. We signed the contract and the inspections and appraiser did their thing. All looked good but the only thing that was odd was the appraisal was not turned back in yet. They had been to our house a few weeks earlier and usually appraisers get it done and turned in around a week.
This is where it went downhill. It was a week before closing and the realtor assured me that all should be fine, that they were expecting the appraisal to come back any time now. I was starting to get nervous when it was 3 days before closing and still no appraisal. So I asked the buyer’s realtor what the hold up was and she said all is well they will get the appraisal to us on time. It was the day before closing and the appraiser finally returned a totally ridiculous appraisal. They said our house was only worth $190k. Well that was what we paid for it 4 years earlier and we fixed it up so we knew it was worth more. The contract purchase price was $220k. That was $30k below purchase price. We argued our case but the appraiser wouldn’t budge. I even showed him other comparables of smaller less nice houses that sold for way more than $190k in our neighborhood. He still wouldn’t change the appraisal. Then I started to realize there was a friend connection between the realtor, the buyer and the appraiser. I think what likely happened is the buyer found a home they liked better and wanted to back out of the deal without losing their earnest money. To do that they would need a way out. That way was making the appraisal come back extremely low so we would have to either drop our asking price or let the deal fall through and return the buyer’s earnest money. So we didn’t have any way of fighting it. We met with the president of one of largest real estate brokers in town to let him know we didn’t appreciate their realtor leading us along up until closing like everything was okay and at the last second give us a bad appraisal. We felt the appraiser they used was not honest. The broker didn’t seem to care about our complaint until I set up court mediation at the Tulsa courthouse.
Mediation is a process that you can set up at the courthouse to bring both parties together in order to solve a problem. I honestly didn’t even care about getting the earnest money, but I wanted the broker to take some responsibility for their agents’ lack of integrity and the sketchy business practice that took place. My wife and I both felt like we were given the old bate and switch.
I had a uHaul already in front of my house and we were all packed and in the process of loading it up. Right at that moment, the day before closing, is when we got the phone call that the deal wasn’t going through. I know this type of thing happens sometimes but it’s usually not the day before closing. If they would have told us a couple weeks sooner we would have been disappointed but at least our entire house would not have been packed.
The lesson I learned is that there are sketchy people in real estate and even if they are representing a well known brokerage you should still be aware of odd behavior. The agent’s job is to bring the buyer and seller together and make sure everything runs smoothly from filling out the Tulsa real estate contract to closing. Even though they can’t control everything, they at least need to be competent. I should have addressed my concerns with the brokerage that their agent was not doing their job in a timely manner. This may have exposed stuff sooner and we could have ended the deal sooner than the day before closing. Then put our house back on the market. We know the appraisal was dishonest because we ended up selling the house with a different buyer at $215k. That is a $25k difference from what the original appraiser said it was worth.
If you are selling your home you probably don’t need to worry about this happening to you but stay on top of the realtors and make sure everything on the to do list is crossed off well before closing. I truly believe most people are honest but keep your eye out because there are wolves in sheeps clothing in the real estate industry.
If you don’t want to sell your property the traditional way and just want to sell your house and not worry about what the appraisal comes back at then you can sell it to a local Tulsa investor like us. A good investor will run their numbers well and make sure their funding will cover what they need at closing regardless of the appraisal of the home.
Remember if you know of anyone who has a house that needs some love and needs to get it off their hands, please let us know so we can help them. We buy homes cash in Tulsa!
Call or text us at 918-297-6222.
This website does not provide legal advice and does not create an attorney-client relationship. If you need legal advice, please contact an attorney directly.