“What Happens if the Home I’m Buying Doesn’t Appraise?” is the next video series for Home Buyers. In this video, I talk about something that has been happening more often lately as the market has picked up.
“In today’s changing real estate market, with home prices on the rise, there’s more concern than ever with appraisals. As a home buyer, you don’t need to be too concerned however, because the appraisal process is there to protect you. If the house you’re trying to buy doesn’t appraise, one of two things can happen: you can elect to pay the original sales price and bring the difference in cash to the closing table, or you can try and renegotiate with the seller to get them to come down to appraised value. If you can’t work it out with the seller, you have grounds to terminate the contract, and you’re entitled to get your earnest money back. In reality, what usually happens is the seller bites the bullet, reduces to appraised value, and you continue moving towards closing. It’s really in the seller’s best interest, because otherwise, they’re going to have to put the house back on the market, and they’re probably going to have to go through the whole thing again, with another appraisal that doesn’t come in for value, or face the fact they are just not going to be able to sell for what they want to.
So when it comes to appraisal time, try not to get too stressed out, remember the appraisal is there to protect you. And if it doesn’t come in for value, it can actually save you money.”
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