Whether you’re buying or selling a Barron County home, an appraisal is usually part of the process. The lender will require an appraisal to verify the market value as part of the mortgage approval. The appraiser determines market value by making comparisons to similar homes that have recently sold.
But finding comparisons can mean looking at sales from six months ago, when market conditions may have been very different. Or, in rural locations, the appraisal may involve distant properties less relevant to your area. When an appraisal comes in below the expected value, it puts Barron County home buyers and sellers in a bind!
If the appraisal is too low to support the buyer’s mortgage needs, the buyer might:
1. Increase the down payment to cover the difference
2. Ask the seller to compromise on the sales price
3. Cancel the purchase, according to the financing contingency
For sellers, a low appraisal can potentially mean the loss of the entire sale. Or, a potential reduction in the sales proceeds if the home price is reduced. If you need the sales proceeds to finance another home purchase, a low appraisal can jeopardize everything.
Fortunately, you can appeal a low appraisal. First, check the appraisal against your home features and local market. Find ways to prove a higher value. This could include newer or more localized sales data, or overlooked facts about your home’s amenities. You’ll need to show documentation to prove your points. We can help with this!
Another option is to purchase a new appraisal to be performed by a different company. This would need to be approved by the mortgage lender, and the appraisal fee would be due up front. There’s no guarantee of a higher appraisal value, but it can be worth a try.
Low appraisals don’t have to break your deal. We can help you determine your options and negotiate a solution!
Six Lakes Realty offers the very best in real estate guidance! We are a locally-owned family business with over 40 years of experience. Our friendly, hometown service is just a call away!
John Flor CRS, GRI, ABR, RSPS, RRS, e-PRO
Team Lead / Property Marketing Specialist
Six Lakes Realty powered by Keller Williams Realty Diversified
Office: (715) 924-4806