Was Your Appraisal Lower Than Expected?

So what happens if the property that you’re trying to buy does not appraise for the sales price that you have on your sales contract?

Thankfully, this does not happen very often. However, if you do find yourself in this situation, there are a couple of things that you’re going to want to be aware of.

Number one, most sales contracts have a clause in them that allows a buyer to get out of a contract and receive their earnest money back if the home does not appraise for your sales price.So unless you have signed an appraisal waiver form which says that you will buy the property no matter what it appraises for,
you have a failsafe in most contracts to get out of it.

Secondly, and this is a big misconception, sellers are under no obligation to sell you the property just because it appraised for less. Are they more likely to renegotiate a contract with you and possibly split the difference or come down to the appraised value? Yes, but they’re not obligated to. So if you find yourself in this situation, you’re absolutely going to want to work with your realtor and your lender so that we can get together with the appraiser and do what’s called a rebuttal, which is where we’re going to say, hey, we have some additional sales or comparables that maybe either we’re not used or we feel like the adjustments could be tweaked a little bit to help improve our value.

So if you find yourself in a situation, don’t panic. Just reach out to your realtor and your lender and let’s see what we can do to save that deal.

If you find yourself in a situation, don’t panic. Just reach out to your realtor and your lender and let’s see what we can do to save that deal.

Bethany Ashby

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