Began 0313 on streamline refi with Chase.  Wanted closing costs rolled into loan which was agreed.  Chase orderd appraisal.  IT was done.  IT is wrong!  Appraiser missed 1.5 baths in my home potentially reducing appraisal by 10-15 k.  Meanwhile Chase denies loan because of insufficient funds, even though I have never been late, am a customer, they know the appraisal is wrong.  I feel like I'm getting the dirty end of the stick.

Many people have the mistaken idea that the "their bank" is going to give them special consideration for a home loan.  The underwriter is looking at the appraisal that was delivered to them and isn't concerned at all about your banking relationship with them.  Continue to work with the loan officer to try to get the appraisal corrected.  The loan officer can have no direct contact with the appraiser.  So getting an appraisal corrected can be a challenge when it has to go through a number of people to request a correction.  This is due to a federal regulation called HVCC - Home Valuation Code of Conduct.  Contact your congressman and senator if you think that the HVCC rules should be changed.

Contact your loan officer and have them initiate a review into the appraisal.  That takes time but should be the norm in a case like this.  I don't know where you are and if 1.5 baths would add that value.    I assume you are doing FHA?  If that is the case you may as well work with Chase because that appraisal will follow you even if you go to another lender.  If conventional again I would say have your lo fight the appraisal.

Just one item to mention....are any of these bathrooms in the basement? If so they will not be included in the bathroom count and should be counted as part of an overall adjustment for finished basement. Moreover, look at the report and see what adjustments were made for the bathrooms. This should give you an idea of the value you are losing on the appraisal.

Tom:

Not sure what part of the county you're in, but down here in the SE a full bath adjustment can add 2,500-3,000 in value depending upon fixtures, finish, etc. This is of course assuming that all four walls in the spacce containing the Bath are above grade. I have the same situation in my house, a full bath downstairs is not counted in the "GLA" room count.

You can appeal the accuracy of the appraisal throug hyour broker or lender. Most appraisers will be glad to explain (thru the lender, of course!)

Godd luck!

If you are doing a FHA streamline then try to get it done without an appraisal...

See if Chase can get it done that way.....

You willprobably have to bring a payment to a payment and a half to close but you would have to make the payment anyway...

I worked for Chase for 4 years, I left because of issues like this - the way they treat their clients.  They have no movitve to give you a new loan with a better rate and on stream lined there is no recourse with the appraisals.  They will not change the appraisal - on a stream line.  Your loan officer is very powerless at Chase, no matter how hard they try, there is not much help they can give you.

Tom,

Let's start over here. A) You have been told that if the bath is on the basement it will not be counted, but since you say 1.5 baths were not counted do you mean 1 full bath and another half bath? If so, even if one is in the basement, the appraiser then missed something upstairs. This can be revised and/or Chase can order another one due to the appraiser being unqualified. B) You also say it was denied because of "insufficient funds", this to me is really more of your issue. Even with the closing costs rolled in apparently you still needed funds day of closing and if I'm reading your statement correctly Chase is saying you didn't have these monies available or they were not verified in the application process?, hence the denial.

So, two things, Chase should correct the appraisal and if you need funds at closing and you have them make sure they see those asset statements.

On a third note, I agree with Jennifer, the 'big box' lenders are swimming right now, most of their qualified originators have jumped ship to better places to originate, thus you are left with inexperienced people and a system that is overun currently due to the volume nationwide, which led to your incredibly long turn times, even for a denial.

You can go to a qualified Mortgage banker in your area and ask for their assistance or you can battle Chase, I would at the least file a complaint, with today's regulations complaints from consumer's on mortgage loans are taken much more seriously now than in the past.

Good luck,

Dan

That is unfortunate.  Others here have given good suggestions.  Hope they were helpful.

By the way, is this FHA?  I am presuming it is.

As already stated, it is such a HUGE mistake when borrowers believe their current lender will offer them something better, quicker or cheaper.  So untrue. That's especially so for the turtle-moving big banks.  And they could care less about you banking with them or anything else.  They are too big to care.

In fact, look at your scenario from this point of view.  Chase has you as a customer at 6.25%, or whatever it is.  You try to do a streamline refi and it appears you cannot - for whatever reason.  What incentive does Chase have to knock themselves out trying to close a loan they already have?

I assure you if this happeend in my office, that appraisal would get corrected.  At Chase, they are too big, too impersonal and too many layers of management.

Chase is saying you have insufficient funds to close probably because with the lower value, you are unable to include all the closing costs in the loan.

If you ever do a streamline refi again or know someone who wants to do one, a broker is the place to go.  Never your current lender and never the mega banks.  Can't believe Chase has this stupid appraisal. I'm sure they have an interest in an appraisal management company.  Never heard of an appraiser missing 1.5 baths.  No photos either?  And if he/she did, they should be immediately removed as an approved Chase appraiser - or any list of appraisers.

Hope this turns out ok for you in the end.

P.S.  Did you pay for the appraisal and do you have a copy?  If you do have a copy, call the appraiser.  Their contact info is on the appraisal. No reason you can't tell them about the missing baths.  And take a look at your prior appraisal.  How many baths are shown?

EDIT:  Sunday, June 6, 2010:  As my colleague so correctly pointed out, I should not have said "never" use a current lender or big bank in my comments above.  Very few things are "never" in life.  And of course there are many borrowers who have done it successfully.  My professional apologies for that overstatement.

Carol....pretty bold statement to tell someone they should "never" go with their current lender and "never" go with a big bank. I work for a Wells JV and if this were a Wells customer we could have closed it without an appraisal. This would have taken the whole value varibale out of the equation.

I certainly have no probelms with brokers. I worked wholesale for years and may go back at some point, but there are some advantages to dealing with a big bank. For example....many big banks have put in place strict limits on what can be done as far as per loan profit. I couldn't sell a good borrower a rate over 5% on an FHA deal today if I wanted to (without one heck of lender credit). In addition, there are some lower margin products that big banks offer great rates on that many wholesalers don't care to compete. Some ARM's are a great example. On the FHA 5/1 with a 1% annual adjustment cap and a margin at 1.75% I am at full commmission between 3.25% and 3.375% today and on the 10/1 conforming ARM we are looking at 4.125%. (By the way these are on 60 day locks) Finally, many people just like the servicing they get with their current lender. I get a lot of good feedback about my employer's online portal. It is very convenient and there are a ton of payment options at no additional charge (bi-weekly, extra 10%, auto-pay, etc). So don't fool yourself, there are tons of good originators out there at the big banks that are doing 30+ million in volume each year. They have a business largely built on strong referrals because they do a great job serving their customers and partners.  I would never get on here and tell someone not to use a broker...you might consider the same courtesy.

Aside from that snafu....the rest of your insight was very helpful.

Thanks,

Jason

You are so correct, Jason.

I should know better.  Never say the word "never."   :-)

The situation made me so angry, I lost my womanly ability to be rational for the moment.

By the way, I didn't suggest "not" using a broker.  I am a broker/banker.