Options for Remedying a Low Appraisal
Here’s how our team handles low appraisals in today’s real estate market.
In this market, hopefully, your listing agent can get you an offer that either waives the appraisal contingency up to a certain amount or waives it altogether. However, you're more likely to end up in a situation where you’re selling a home and the appraisal comes in well below the agreed-upon sale price. If you still have the appraisal contingency in the contract and it comes in low, here’s how you should proceed:
First, check the appraisal document for human error. There could be a typo or missing comp that completely throws off the home’s estimated value. If there isn’t any human error but you do have better comparable homes that support your sale price, the next step is to send those to the appraiser.
"All relevant, comparable home sales should be considered."
If they still won’t budge, it’s time to renegotiate. There is a five-day period built into the standard contract for the buyer and/or seller to come up with the difference between the appraised value and the sale price. It’s best to start negotiations as soon as possible for that reason. It’s up to you and your listing agent to determine whether it’s a good idea to go back to market versus selling for a little less. There are a lot of factors to consider.
If you have further questions for me about appraisals or anything else related to real estate, don’t hesitate to reach out via phone or email. I look forward to hearing from you soon.