Originally Posted by Heathpack

Real estate is so crazy here that I was ok with being upside down when we bought our current house. We were buying in the last big real estate crash and my opinion at the time was that appraisers (esp VA appraisers which we were using) were being too conservative. They were spooked by recent irresponsible lending practices or maybe had a mandate to “protect” the buyer a little more than they had. The trouble was, they were protecting vets right out of the market since pretty much all houses had multiple offers and the nonVA offers were consistently accepted over VA offers lest the VA offer not appraise.

Our realtor took to driving around neighborhoods at random and looking for houses with renovations going on, chatting up the tradesmen to find houses about to go on the market. He got wind of our current house in advance and it was a listed a little low we thought. We jumped in at over asking price, in a rare single offer scenario.

Offer was accepted but- you guessed it- the house didn’t appraise. We felt pretty certain the appraisal was just wrong. And then we figured out it was fraudulent. I was googling the guy post appraisal to check him out, realtor (who was present for the appraisal) looks over my shoulder and says “that’s not the guy who did the appraisal”.

Turns out VA appraisers have to go where they’re assigned and our house was a 90 min drive for him. We never figured out who he sent in his place but our appraiser never set foot in our house. Lol I can’t remember exactly how we worked it out but in the end our mortgage broker made the appraiser aware that his jig was up and the response was essentially “tell me what you want me to appraise it for”. Totally sketchy but it got the job done.

Maybe our example is a bit wild but there were multiple houses I would have been fine being upside down in if they didn’t appraise. We thought the market was very undervalued at the time. Ten ish years later, we were right, our house has appreciated 35%. We were technically upside down in it for the first two years. But we had no intention of selling it on any kind of short time frame anyway.