Updated over 8 years ago on . Most recent reply
Property appraised with after rehab value but not pre rehab value
We are under contract on a building that is 3 apartments and a storefront. It will require pretty significant repairs including foundation and slate roof. Because of all the particulars, it qualifies for both federal and state tax credits for historic restorations for the cost of the work that is needed. We would get 45% of the costs back. Sweet.
We went to our local small town bank for financing, and they approved the loan.
BUT - We got the appraisal back yesterday and the pre rehab value of the property per the appraisal is $22,000 LESS than what we agreed to pay for the property. Because the post rehab value numbers work out to support the loan, the bank is letting us go forward.
Question - Do we have any right/opportunity to go back to the seller and ask them to reduce the selling price to meet the current appraised value of the building? We surely don't want to pay more for it than we have to.
Appreciate any good advice .