What Does Your House Need To Appraise For? 

What happens if your house does not appraise for the sales price is a grey area of the contract. In most cases you should assume your house needs to appraise for the sales price (not the loan amount) otherwise the buyer has the right to terminate the contract and receive a refund of their earnest money.

There is an addendum you can request the buyer include with a contract called the Addendum Concerning Right To Terminate Due To Lender’s Appraisal. Click here to see a detailed analysis of this addendum:

This form has 3 choices that can be selected providing more clarity about what will happen if the home does not appraise for at least the sales price.

We often see this form used if there are multiple offers and a buyer is paying over asking price or if a buyer is concerned they are paying over appraised value.

Keep in mind requiring this form may scare a buyer off from making an offer for your home because they will believe they are paying too much. Please let us know if you want to require this form to be included with any offers.

We can’t guarantee your home will appraise for the sales price as the appraiser give a value that is based on their opinion of value. However, we make every effort to work with the appraiser for your home to defend the value of the sales price. We will provide the appraiser with comparable sales, upgrades and special features of your home and an explanation for any recent comparable sales that will not support the sales price.

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