Sellers: Know Your Options If Your Home Fails to Appraise!

There are many great Phoenix area homes for sale. Click here to perform a full home search, or if you're thinking of selling your home, click here for a FREE Home Value Report so you know what buyers will pay for your home in today's market. You may also call me at (602) 954-4663 for a FREE home buying or selling consultation to answer any of your real estate questions.

Sellers: Know Your Options If Your Home Fails to Appraise!

In my previous post, we spoke about your options as a buyer under contract when a home does not appraise for or at least the purchase price. Today, we will flip this scenario around and look at it as if you were a seller, who is under contract, and your home doesn’t appraise.

Within the past four months, we’ve noticed a transition in the market – the market has flattened out into a regular, or “normal,” market. Due to this market adjustment, there may be some instances where your property fails to appraise. As a seller, you have a few options:

1. Reduce the purchase price to the appraised value once the buyer formally notifies us
2. Negotiate with the buyer to meet somewhere in the middle
3. State that you will not reduce the purchase price to the appraised value

As a seller, you must be careful; if the buyer is an FHA Borrower, that appraisal will follow you for at least 90 days. With an FHA Borrower, your options are:

1. Reduce the purchase price to the appraised value
2. Place your home back on the market and wait for a Conventional loan or cash offer

As professional listing agents, our job is to minimize your appraisal risk. When we meet at our initial consultation, I will provide you with your home’s comparative values from within the past 90 days. These are the values that appraisers use when appraising your property. It is also worth noting that an appraiser may reach out to the listing agent to obtain comparative values. This is something we are happy to do – we will put together a professional presentation for them and provide it to them at the time of appraisal or via email.

If you’re looking into selling your home, we would be more than happy to help. Also, it is a great time to purchase – buyers can take advantage of low interest rates, which are sitting at 4.5%, and a great selection of inventory. Thanks and have a great day!