Here are my tips for what you can do if the appraisal comes back low.
Our real estate market is a little crazy right now and we’ve seen record-high prices. That’s great news for sellers, but it does present some complications when it comes to appraisals and what a bank will actually give a prospective buyer. Today I’m talking about what happens if appraisals come back low.
An appraisal is when the bank hires a third-party appraiser to come to take an assessment of the value of the property. Whatever that assessment comes back at is what the bank will lend you to purchase the home. However, as we see prices skyrocketing, we’re seeing a lot of appraisals come back low. In our market, one in five appraisals come in low. Here are your options if that happens:
1. Walk away from the deal because you had a financing contingency built into your offer.
2. Come up with extra cash to make up the gap.
3. Renegotiate the sale price of the property.
More often than not, your appraisal will come back at value and you’ll be ready to close in a week or two. If you have further questions about this topic or anything else related to real estate, feel free to reach out to me. Have a great day.