Question: We're buying a house and the appraisal came in $21,000 too low. Apparently the appraiser didn't make accurate adjustments for the lot size and after being pressured by our lender, the appraisal was upwardly adjusted by $13,500. The seller has quickly agreed, without us asking, to lower the price to meet the appraisal, and has issued a new contract at that price, but we are skeptical about the pressure the lender put on the appraiser to adjust the appraisal. Since the seller was not obligated to offer a lower price, which would allow us to void the deal based on mortgage contingency, are we obligated to sign a new contract for the lower sale price?

Answer: How do you benefit as a buyer from an upwardly-revised appraisal? Does not a higher appraisal lead to a steeper price and a larger monthly mortgage payment?

How do you know the lender wanted a higher price? Do you have evidence? If what you say is true, then how did the lender help you in this matter? As a buyer would you not be better off if the price were reduced $21,000 rather than $7,500 ($21,000 less $13,500)?

Are you obligated to use the current lender? If not, perhaps you will want to see if better financing is available elsewhere.

As to your commitment under the sale agreement, it depends how the document is written. It may well provide that you are obligated to go through with the sale if the owners reduce the sale price to the appraised value. For details, have an attorney review the sale agreement and your loan papers.

Question: We signed an agreement to purchase a condo in 2005. These are condo hotel units sold to investors, renovated and promised huge appreciation. We attended an HOA meeting recently to find out why our rentals were not as profitable as another condo we bought down the street.

Then we found out our condo is handicapped. There was nothing in the contract that indicated that some of the condos maybe handicapped, so we were really surprised. The handicapped condo is not as attractive as the other unit, and everything is lower, very inconvenient. Is there anything that we can do about this situation?

Answer: It's hardly surprising that returns on two condos in two different projects differ. There could be any number of reasons why, including management, marketing, design, condition, location, pricing, etc.

As to the idea that your unit is less valuable because it offers easy access to those with disabilities, if anything such a unit should attract a larger pool of potential renters because easy-access features are not available in competing units.

Compare the marketing, management and maintenance programs associated with each property. You can bet they're different -- and the core reason for unequal rates of return.

Question: I am displeased with my broker. He promised to print for-sale flyers in color and didn't until I prodded him. I wanted him to post more photos of my home online, not just the front view.

My house has been on the market for 15 days. I have had one showing. I have not had an open house, I have not had my broker take other brokers through. I am told that the market is really bad, that's why I believe that the marketing piece is really important.

As a seller, I have done my part, I have had my home completely painted both interior and exterior in neutral colors. I have hired the very best (and expensive) carpet shampoo person in town. I have "de-cluttered" every room in the house getting rid of personal items, and even moved piano and other furniture items out to a storage unit to make it look more roomy.

Our listing agreement has three months to go. How can I get out of it?

Answer: If your broker promised to print color flyers and to post multiple and interior photos online, then that's what should happen.

Moreover, better marketing helps everyone. The broker will not earn a dime unless the property sells -- reason enough for both parties to work toward a common goal.

After two weeks you now want to dump your broker. I think this is a little quick on the trigger. As an alternative, sit down with your salesperson and review the marketing plan and the promises you received. If that does not work, then sit down with the broker.

A listing agreement is a contract and cannot be ended unilaterally by one party unless the agreement offers that opportunity or the other party agrees. Alternatively, a broker does not want unhappy clients broadcasting their dissatisfaction. You and the broker should be able to work something out that makes sense for both parties.

Question: I refinanced my rental property with a subprime loan, and now I can only afford to pay the minimum payment even with a renter. I am still spending $500 a month on the HOA and to meet the minimum payment I am still losing $1,000 a month. The house is now appraising at $30,000 less than it did when I refinanced. I have tried to lease option it with no luck. My credit is in good condition, and my income shows that I can pay the full amount, so I cannot do a short sale. I still have my main home, and I was considering letting this rental property foreclose. Do you have any suggestions.

Answer: You say you have good credit. If this is true, why do you have a subprime loan, financing which is for those with impaired credit?

Would it make any sense to refinance your residence with a loan at a lower rate and pay off the rental property? You would then have lower costs and perhaps come closer to breaking even.

Question: My recently widowed, retired father purchased a condo for $193,000. His was the first contract, before they even broke ground. The unit was supposed to be completed in December 2006 but remains unfinished.

In the meantime, the builder lowered the price of this particular unit to $175,000. I am asking the developer to please renegotiate his contract since there has been such a drastic drop in price. All of the other units in the community have all already gone up in price (they are larger than his, but they all increased by several thousand dollars and his dropped $18,000).

What recourse does my father have if the builder will not renegotiate?

Answer: Let's say the value of the unit increased $20,000 before closing. Would your father then go back to the builder and offer to pay more than $193,000 for the property?

Have an attorney review the sale agreement to see if there are provisions which might allow your father to void the agreement without penalty.

Question: Two weeks ago I made an offer on a bank-owned house. The bank was impressed with the offer, however, the listing agent said there was another offer so I upped my offer $8,000. Four days later they told me they accepted the other offer which was $15,000 lower than mine because it was a cash offer. My loan was already approved, so there was no financing contingency and I would have closed within two weeks.

The house is still in contingency with the cash offer and I was wondering if I had any recourse about these terms. Should I wait in the background to see if the deal falls through because I really wanted this piece of property.

Answer: A seller is not obligated to accept the highest price because there are a variety of issues in a real estate sale agreement. That said, I would not have turned down an extra $15,000 -- but I'm not a bank.

You could make a back-up offer. If accepted and the first offer fails, then you might be able acquire the property. However, if you make a back-up offer you might want to offer less than your original bid given the information supplied by the agent. Speak with a buyer broker for details, if you do not already have one.

Question: My husband and I own our home. We bought it from his grandfather for $26,500 (rent-to-own) and after five years he signed over the deed. We have done some work and it appraised for $70,000.

Should we sell and invest in a duplex (live in one side and rent out the other)? Are duplexes a good investment? We live in the Midwest and rent would go for about $995.

Or, is this a bad idea all together and should we just get another house, either way we do not like the location of our current home and staying is not an option.

Answer: The grandfather gave you a tremendous gift, that's a very decent thing to do.

Not knowing anything about your market I cannot suggest buying or not buying any specific type of property. That said, would it make any sense to refinance your current property, rent it and then use the money to buy a duplex?

Speak with local real estate brokers for specific information and options.

Question: I'm trying to sell my mother's house, something inherited in an estate situation. We have an offer on it, but the buyer would also like to have the first option to buy the piece of land next to the house that my brother now owns. Should my brother get money to sign this agreement up front?

Answer: You need to know more about this option. How long does it last? How long would the buyer of your mother's house have to act if your brother received another offer? What other offers or interest do you have in the property?

Plainly there's a value to an option, especially if it means your brother's property is less attractive in the marketplace. Alternatively, is your brother getting money from the sale of your mother's home?

You need to look further into the specifics of the option. Have an attorney who specializes in real estate help you with legal language.

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Published: August 24, 2007

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Have a real estate question for Realty Times? Wondering about buying, selling, financing, refinancing or renting? Here's where you can send your question to Peter G. Miller, OurBroker®, a nationally-known columnist, author and reporter. Peter G. Miller has written six books -- including The Common-Sense Mortgage -- a guide with hundreds of thousands of copies in print. Miller was the original creator and host of America Online's Real Estate Center and joined Realty Times in 1998. Send your questions to . Because of the volume of mail received, individual questions cannot be answered privately and not all questions can be used. Published letters may be edited for space and style and all letters become the property of Realty Times upon receipt.