In this active real estate market inventory is thin and desirable listings are moving quickly.Such high demand for these desirable listings creates a bidding war which is fantastic for the seller but could pose a problem for your client, the highest bidder. The problem occurs if your clients highest bid turns out to be more than the appraised value. Although we're not seeing this happen very often now we are definitely going to see this scenario happen more and more frequently as our inventory gets even thinner.
Select borrowers have access to a fantastic benefit called a Property Inspection Waiver (PIW). These PIWs are available for those doing Conventional loans with at least 20% down. If the borrower's credit is strong and the property is reasonably priced the automated underwriting system will issue a PIW which allows the borrower to proceed with the loan without the need for an appraisal. As we all know even a small discrepancy between the appraised value and contract price can cause financial issues for both the Buyer and the Seller. By using a PIW when it's made available home value issues are completely eliminated for all parties to the transaction.
Is there a topic, program or guideline you'd like to know more about? We strive to make these monthly emails as informative as possible, so if there's anything you'd like to know more about please just let us know! Simply email us your question and we'll put the information together for you and include it in a future newsletter!
As always, feel free to contact us at any time for personalized loan scenarios for you and your clients! Please Call (321) 757-5009.