05 Aug How To Use a Rebuttal Letter to Contest a Lowball Appraisal
No party involved wants to reach the appraisal process only to watch the entire deal crumble. In the case of a sale that risks falling apart after a lower-than-expected appraisal, a rebuttal letter may come to the rescue – if executed correctly.
Several sources cited in a recent Wall Street Journal article gave inside advice for how to submit what is also called a “reconsideration letter.” Though this formal letter offers only a slim chance for an adjusted appraisal to hoist the sale back on track, a number of agents have found success using this technique. In the best case scenarios, a new appraisal gives the borrower another chance to qualify at the desired loan amount instead of scrambling to deliver a higher down payment.
Select tips from the WSJ piece include:
- The borrower or loan originator prepares the rebuttal letter for the commissioning lender, with input from the agent and/or an appraiser
- Rely on facts (not emotions): offer data, exhibits and professional opinions
- If possible, prove factual errors, flawed methodology or that appraiser lacked market familiarity/experience
- State your intention to report appraiser to licensing board if flaws aren’t promptly corrected
- Letter should be bound professionally and distributed to all parties
To avoid a dangerously low appraisal, ensure the appraiser is highly experienced in the area and with the type of home, especially when selling a luxury property.
Read the full article at: http://online.wsj.com/article/SB10001424127887323993804578612042804523384.html