Some quick questions about CMA value for my house.

[PurplePanda]

I have an attorney and will be filing a CH7 petition in 3 to 4 weeks. I am an under-median filer. There are a few complicating factors, all of which my attorney is aware of. My biggest concern is exempting my home equity and keeping my home.

I am in Michigan and so I have the option of using Federal or Michigan exemptions. Generally speaking, the Federal exemptions are more generous across the board, except for the homestead exemption, so I am going with my state exemptions. I lease my car and the only other assets I have to protect are my household items and furnishings. I purchased my house three years ago and, obviously, the value has went up considerably. The paperwork provided by my attorney asks for the "fair market value" of my house. I contacted my realtor from when I purchased my house and asked her to provide me with a CMA because the values I found on various online sites varied by thousands of dollars. For example, Redfin, Zillow and Trulia are all coming in around $230K but Bank of America comes in at $210K.

My realtor's CMA is coming back at $192K, which seemed low. I then asked what her listing price would be if she put my house on the market today and she said she would list for $205K or maybe a little more. She also said that she could adjust the CMA and increase the value closer to that number, but that $192K is the accurate CMA number based on comps over the last 6 months.

Correct me if I am wrong, but wouldn't the "fair market value" actually be $205K rather than the $192K from the CMA? Or, do I provide the CMA value to my attorney as being the fair market value? Should I ask my realtor to adjust the CMA value a little higher to get closer to her listing number, or would I be out of my mind to do that? I want to provide a fair, accurate number and I want it to be credible. I don't want to use an artificially low and unbelievable number on my petition/paperwork and cause a trustee to question how I value all of my assets.

Thanks for your help.

[justbroke]

FMA, fair market value, is a misnomer. In real estate sales the fair market value is what a reasonable seller will sell to a reasonable buyer while being affected by market conditions. The fact is that you already see different valuations from different sources. The online sources use an automated valuation method/model or AVM. Some AVMs are good, but most give an estimate of value based on a proprietor (computer) algorithm. That's why your agent shows a different value because they use comps based on the market.

For example, an AVM could choose a comp that's not even in your neighborhood because it's "close" to your home. That could affect the price up or down... and is the reason why most don't trust Zillow's estimate of market value (although Zillow now provides a range).

You don't want to use an unusually high valuation either. I think the best is a CMA from an agent, then I'd go with an appraisal if I had to prove the value. The Trustee may ask where you obtained the valuation and you can say from a Realtor. That may give more weight. If you're worried about showing too much equity, and you're close to that number exposing too much equity, expect the Trustee to take a closer look. Whether or closer look means that the Trustee will challenge you on the valuation is too hard to tell. If they notice a big discrepancy in "their" source and what you listed, they may actually ask about the valuation in the 341 Meeting.