Hello, all. We recently had an inspection on a home including a structural engineer because we felt like there might be structural issues. We were correct and a few walls in the basement must be braced but not excavated. The seller won’t budge on price and insists that the cost of the bracing is built into their price already (the home is tax appraised at $15,000-$20,000 higher than what we are buying it at but it has a lot of work it needs cosmetically). We are about to have an appraisal on the property. Should we disclose the engineer report? Must we?
I’m worried the appraiser is going to see an issue of $20,000 in reading the report instead of what it is ($10,000) to fix. Pros/cons to disclosing the report (unless we are required to…which is why I asked “Must we?” as well as “Should we”)?
I guess I was just trying to get a sense of how many of your inspection reports are used in appraisals. This is a for sale by owner so no agent and our attorney doesn’t really know the answer to the question of what the general practice of the appraisers are. Maybe I’ll check in a real estate agent forum. Thanks.
Your question was whether or not you should disclose information provided to you in an engineer’s report … not a home inspection report.
Again, the only practical advice that anyone here can provide to you is … prior to concealing any information from your appraiser that could affect his report to your lender … consult an attorney or your real estate agent. Best of luck.
You are paying for the appraisal. It is for the lenders protection, but it also protects the buyer as well. If it were me, I would want the appraiser to have all the information available to render you the most accurate report available. That is the only way you can make an informed decision on which way to proceed with your transaction. Whether it be negotiate with the seller or cancel the transaction. Good negotiating skill are needed. The seller will now have to “disclose” this info to all new potential buyers if you back out of the transaction. Many sellers do not want the hassle and will negotiate. Discuss it with your Realtor.
Pro - You will be better informed of the correct value.
Con - It may “kill the deal” as they say. But it might just need killing.
Clint VanNest - Realtor/Broker, Cert. Appraiser, Cert. Home Inspector.
Inspection reports are not to be used during appraisals. We inspect for current condition, appraisers try to determine market value. Totally different things.
You should have an agent. They are trained in this sort of thing, negotiations and all.
If your RE lawyer about the “general practice of appraisers” you should get a new lawyer.
Ultimately, YOU have to make the decision for yourself. Seems like you are trying to pass that off to others.
One more thing. You commented “Maybe I’ll check in a real estate agent forum. Thanks.”
This, along with the assumption that you do not have a Realtor, leads me to believe that you are trying to do this transaction “on the cheap”. If so, you are a fool.
Free advice is worth every penny. I would suggest that you hire professionals and let them work for you, just as it is intended.
I used to read, evaluate and write reports on appraisals for a lender.
As noted, home inspections and appraisals are two completely different things with two different purposes, done by different people with different training. I’ve personally never known one to take the other into account.
