When Your Property Doesn’t Appraise…

What happens if your property doesn’t appraise?

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Right now, we’re in an incredible market where home prices are being driven up and sellers are in the driver’s seat. That said, many buyers still need a mortgage to get a property, and mortgages entail an appraisal. Sometimes buyers can waive an appraisal contingency, but more often they want to ensure that they’re not overpaying for the home.

As a seller, when an offer comes in on your home, first find out if the buyer is willing to do a non-appraisal contingency. If they are, then you won’t have to worry as much. However, supposing the buyer isn’t willing to do a non-appraisal contingency because you’re priced at the higher end of the market, what are your options?

      You need to have a great agent who will help you negotiate with the buyer’s agent.


Imagine you priced your property at $500,000 and the appraisal came in at $480,000, meaning that the bank wouldn’t lend any more than that for a mortgage. If it’s a conventional mortgage, the buyer can actually bring more money to the table if they’re willing and able. This is also why you need to have a great agent who will help you have a discussion with the buyer’s agent to see if they’d be willing to do a non-appraisal contingency. If they’re not, ask if they have the money to bring so that both parties could meet in the middle.

Another option is to do a second mortgage and provide owner financing back to the buyer. That’s not necessarily ideal for homeowners, but it is an option. There aren’t many agents out there who know how to do that, so if that’s a route you’re thinking about, make sure you find someone who knows what they’re doing.

If you have further questions about low appraisals or any other real estate topic, call or email us. We would love to help you.

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