Weird underwriting situation — lender won't count one of the two lots in the appraisal. Anyone dealt with this?
Borrower is under contract on a property that consists of TWO separate lots of land, recorded together under one title. Here's where it gets tricky:
• **Lot 1** – Vacant, buildable land (no structure)
• **Lot 2** – Has the 2-unit property built on it
Price of the property is based on both lots. Title confirms both parcels are recorded as a single property. However, the underwriter is saying the appraised value can ONLY be based on Lot 2 (the one with the structure), and they're essentially ignoring Lot 1 entirely — because it's buildable/developable land.
Should I still send this for appraisal?
**My questions for the group:**
Has anyone faced this problem, and was able to get it resolved?
Is there a specific guideline (Fannie/Freddie/FHA) that addresses excess/surplus land in situations like this?