We applied for an FHA loan with leading national bank and was prequalified. We found a property and submitted to the bank and the bank ordered an appraisal and we were charged the corresponding fee of $495. However, we cancelled when we found out that the appraised value is lower than the market value of the property. We found another property and re-submitted to the bank two months later and the bank informed us that we did not qualify for a loan because one of the borrowers is a temporary/contract employee. We specifically asked the bank when we were being qualified if having a temp job would cause us not to get approved and the loan officer assured us that it would not be a problem. We requested for a refund but the bank declined. Being there are no changes in the circumstances and our credit, can we be refunded the fee since we were not preapproved? Thank you.
Refunding of the fee is up to the individual bank and their management. You can take your request to a higher level of management and see if you get a different answer.
Appraisals are performed, and due, regardless of whether the value meets the sales price, the condition of the home is perfect, or the loan closes. IF you had taken the first contract to fruition and been denied due to income circumstances (and you'd fully disclosed all details of your employment to your loan officer), you MIGHT be justified in asking for appraisal money back. In your case, however, the appraisal you paid for was completed, and the contract cancelled due to low value. Not the appraiser's fault the value wasn't there, in fact, a low appraisal usually ends up protecting the buyer from overpaying. Have to say since services were rendered, there is no recourse for a refund.