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What to do when your appraisal comes in much lower than the offered price?

The purchasers are going FHA.
  • April 26 2014 - Garden City
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Answers (2)

Profile picture for Outer Banks N C
I have argued and gotten appraisers to increase their appraisal, but never for one that was "much lower" as you said. Good luck.
  • April 26 2014
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There are several avenues that can be taken.  The FHA addendum states that the property must appraise for purchase price. If the agents feel the appraiser is wrong and there are comparable properties that have sold in the area they can present them to the appraiser.  They must be closed prior to the appraiser visiting the property within the last 6 months (most likely this year). The buyer can pay the difference in cash at closing.  The seller can drop the price to appraised value or the buyer and seller can come to an agreement and then the buyer would have to bring that difference in cash at closing. If the seller isn't willing to lower the price and the buyer can't afford to pay the difference up front then the deal goes dead and the buyer get their deposit back and starts looking for a different home.  The seller need to be aware that the FHA appraisal with stick with the house for 6 months, so any buyer using FHA financing will get the same appraisal.

Good Luck!
  • April 26 2014
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