Few things in the home buying process are more frustrating than having your offer accepted, only to have the appraisal fall below your offer. But all is not lost! If the appraisal comes in below your offer, there are several tactics and strategies that can lead to a happy solution.
Get a second opinion: There’s no need to take the appraiser’s estimate as fact. You can pursue a value appeal, or you can discuss a second appraisal with your prospective lender. Sometimes you can even get the seller to pay for the second appraisal because they will be motivated to complete the sale. Your real estate professional should be able to help you through the process of an appeal or a second opinion.
Renegotiate for a lower price: Unless the market is extremely hot, there’s a good chance the seller can be talked down to the appraised value. Sellers often prefer to complete the deal, rather than putting the property back on the market.
If all else fails, resist the urge to pay more: Sure, paying more in cash to cover the difference between the loan amount and the agreed upon sale price is tempting. Buying a home is an emotional experience, and you may think that this particular home is the only one that you’ll be satisfied with. Take a step back and consider searching for another property.