Here are the three options you have if the appraisal comes in low.
It’s difficult to believe we’re already this far into 2021, but all signs point to another seller’s market this year. With sellers continuing to benefit from low inventory, many buyers are paying way over asking price just to secure the home. However, what happens when the appraiser comes out to the property and finds the value of the home to be lower than the sales price? Here are the three options we have for when this situation arises:
1. Request a copy of the appraisal. Appraisers are human, just like the rest of us, and sometimes mistakes are made. So we first verify the appraisal to ensure all the house’s information is correct.
“This is yet another reason to have competent representation.”
2. Submit a rebuttal. If all the information is accurate, then we can rebut the appraisal with the lender involved by supplying updated information about the property and any other comparable home sales that we feel will help justify a higher sales price. It can be challenging to get the appraiser to change their assessment, but we’ve done it successfully.
3. Ask the seller to adjust their price. If the other options have been exhausted, the buyer can ask the seller to lower their price to the appraised value. The homeowner isn’t required to do this, though, and will sometimes only consider this option if your contract says that the sale is contingent upon a satisfactory appraisal or the buyer’s loan won’t get approved based on the lower appraised value.
All of this is to say that we have options if we’re faced with a low appraisal. This is just another reason to have competent representation whether you’re a buyer or seller.
Call or email us if you have further questions about low appraisals or any other real estate matter. We’re here to help.
