WASHINGTON -- How fresh are your "comps" -- the comparable sales of properties used as benchmarks in home real estate appraisals? Buyers and sellers rarely had to be concerned about such a question -- or even understand it -- when values were on the upswing.

But in soft and declining markets, lenders recently have begun making comps a big deal. Some sellers are being forced to renegotiate lower prices with buyers, even after they've got a signed contract.

Rather than accepting sales of similar properties that closed as much as six to 12 months ago, lenders and mortgage investors are demanding that appraisers include only the freshest comps, ideally those closed within the previous 90 days, to support their valuations.

They're also pushing for more extensive data on local listings, pending sales, and listing-price to selling-price ratios before they agree to fund a mortgage at the requested amount.

As a result, growing numbers of sales transactions are being complicated -- even knocked off track -- as buyers demand that sellers lower agreed-upon contract prices to reflect the lower loan amounts offered by lenders.

"Appraisals have become a real hassle," said Steve Stamets, a loan officer with 20 years' experience at Nationwide Home Mortgage Inc. in Rockville, Md. "Some sellers are taking a beating," he said, citing a recent transaction where the appraisal came in thousands of dollars below the signed contract price. Had the seller not agreed to eat the difference -- take a lower price than the buyer had agreed to in the contract -- "the whole deal could have fallen through," said Stamets.

Major lenders and investors such as Fannie Mae and Freddie Mac "may have gotten rid of their 'declining markets' policies," said Stamets, "but now everybody is beating down on the appraisal" by demanding 90-day comps or fresher.

In Richmond, Va., appraiser Perry "Pat" Turner of P.E. Turner & Co. says his firm has seen "numerous" cases where using newly mandated 90-day or more recent comps -- as opposed to those six months or older -- has contributed to valuations lower than the price on the sales contract.

"In 95 percent of those cases," he said, "the (listing and selling) agents have gotten together and renegotiated the contract" rather than lose the deal. Continued...