When a home’s appraisal comes in lower than the agreed upon sale price, it can cause a panic for both the buyer and the seller. But don’t fret; all hope is not lost. In fact, there are several options available that can keep your real estate deal alive.


As a buyer, you think the house is perfect for you, but your lender will only provide 80% of the appraisal value. If the purchase price is astronomically higher than the appraisal, coming up with the difference is sadly out of the question for most buyers. Sellers are likely to favor a renegotiation if:

A. the house has been on the market for months, or

B. the owners are in a hurry to get it off their hands.

Split the Difference

As long as the buyer and seller are equally motivated to complete the deal, you might decide to split the difference. This is likely the scenario if the gap is small. It’s the best choice for buyers if the house has a great location, is an ideal build, and has all of the amenities you’re looking for.

A Second Appraisal

Both the buyer and seller can request a second appraisal. If aspects of the home were first overlooked or recent sales or listings in the immediate area occurred, a second appraisal could return a higher value.

Buyers: Come up with the Difference

If it’s a case of losing your dream home and the seller won’t negotiate the purchase price, you have the option of making up the difference with personal funds. In return, you can ask the seller for small favors, like additional repairs.

Sellers: Offer the Appraisal Value

Unless your home is in high demand, consider lowering the purchase price to the appraisal value. This might save you from additional costs and ventures associated with keeping your house on the market. ­­­

Especially in rising markets, low home appraisals are common. Unfortunately, because a lender will only loan up to a certain percentage of the home appraisal, a low appraisal will put buyers and sellers in a bind. Know your options when a home’s appraisal is lower than expected.

Like this article?


Leave a comment