Your buyers want the house, but it might be up to you to make it happen.
The price is set, the house is listed, and you've got an interested buyer. But then the unimaginable happens: The appraisal comes in short of the asking price for the home.
Is there any way to save this sale? While there's no perfect way to rescue a shortfall after it happens or guarantee that your house will appraise well in the first place, there are measures that you can take that might help.
After a Low Appraisal: Negotiate with the Buyer
When an appraisal comes in lower than your asking price, one thing is absolutely certain. The lender, no matter who it is, won't lend to the buyer what you are asking for.
Forbes suggests that you've got a few options. You could lower your asking price. You probably expected that, and the words probably pinch. Nobody wants to volunteer to reduce the price, but in the case of a low appraisal it could save the sale.
The buyer could also put more money down to make up the difference. That's a precarious request of a buyer, especially one who might balk after reading the appraisal. But in a market that's hot with a low housing supply, and if the buyer really wants the house, it could work. You could also offer to 'meet in the middle.' You could lower your asking price a bit, and the buyer could put more money down.
Another suggestion from Forbes is to challenge the appraisal. It might sound fruitless, but Bankrate suggests there's some evidence that you could succeed. However, the buyer has to request a re-appraisal.
Planning Early: Get As Much Information as You Can
Get your own appraisal, and then you'll know for sure.
Pricing a home isn't easy. Sometimes a real estate agent helps with that, and sometimes a buyer is set on what she needs to get from the sale. But this is never a job for guesswork. The safest way to come to a reasonable price for your home is by getting an appraisal before you list it.
Search for an appraiser at the Appraisal Institute website to ensure that the one you hire has the right credentials and experience. Then once you get the appraisal, you'll have a much better idea about what your home is worth.
Comparables, which are houses similar to yours that have recently sold, make up a great deal of what an appraiser assigns as a value to your home. But if some of those homes were foreclosures or short sales, the prices won't reflect the actual value and, the comparables will be 'off.'
Appraisals make even the most seasoned real estate veteran more than a little nervous. You just don't know what the appraiser will see, and you don't know what your comparables will be.
In just a few minutes, and at no cost to you, you can get your home's estimated value and see the closest comparables. That information is power. It helps you avoid surprises, lost sales, and a lot of headaches.
Get your free property valuation today and plan better tomorrow.