What to Expect once The Offer has been ACCEPTED

When you're in the process of buying a home, understanding the intricacies of the appraisal process is crucial. Your lender initiates this step to ensure that the property you're financing aligns with the agreed-upon price and meets loan guidelines. In this blog post, we'll walk you through the key aspects of property appraisal under contract.

The Appraisal Appointment:

If you're financing the home, an appraiser, typically required by the buyer's lender, serves as a neutral third-party professional to verify the property's value. However, if you're paying all cash, an appraisal might not be necessary. The lender usually contacts the listing broker to schedule an appointment to assess the property.

Appraisal Results:

Once the appraisal is completed, your lender informs you if the appraised value matches or exceeds the sales price and adheres to loan guidelines. The process goes smoothly if the home doesn't have any significant deficiencies like safety hazards or structural issues.

Dealing with a Deficiency:

In case the appraisal falls short of the sales price, a deficiency arises. Your lender bases the loan amount on the appraised value, which can lead to negotiation points between you and the seller.

Options for Resolution:

1. Request Appraisal Reconsideration (VA Loans): For VA loans, buyers can ask the appraiser to reconsider the value, although this is a rare and time-consuming option.

2. Seller Price Reduction: The seller may opt to lower the price to match the appraised value, though it means receiving less money at closing.

3. Buyer Pays the Difference: As the buyer, you can contribute the difference between the appraised value and the sales price in cash to proceed with the purchase.

4. Negotiate a Compromise: Both parties can negotiate a price in between, where the seller accepts slightly less, and the buyer pays a bit more to close the deal.

Lender-Required Repairs:

Any repairs mandated by the lender following the appraisal are also subject to negotiation. Your agent plays a crucial role in negotiating these aspects if they arise.

Conclusion:

The appraisal process is a critical step in the homebuying journey, ensuring that the property's value aligns with the agreed-upon price. Understanding the possible scenarios and negotiation points allows for a smoother transaction. If you have any questions or concerns regarding property appraisals or any other aspect of your home purchase, feel free to reach out to our team using the contact information provided on this page. We're here to guide you through every step of the process.

The agent representing you will be involved with negotiating the appraisal if it comes up. In most cases, there are few issues. If you have any questions on this topic or other issues relating to your home purchase, please contact our team using the information on this page.

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