Home Appraisal Guide: What to Expect and What to Do If It Comes in Low

How a Home Appraisal Works

A home appraisal is an independent assessment of a property's market value, required by mortgage lenders before funding a loan. A licensed appraiser inspects the property, evaluates its condition and features, and compares it to recent sales of similar properties (comparables or "comps") in the area.

What the Appraiser Looks At

• Property size, lot size, and number of bedrooms/bathrooms
• Overall condition and any needed repairs
• Recent upgrades and improvements
• Location, neighborhood, and school district
• Comparable recent sales within 0.5-1 mile
• Current market conditions and trends
• Unique features (pool, views, lot characteristics)

What If the Appraisal Comes in Low?

A low appraisal means the appraised value is below the purchase price. You have several options:

Negotiate with the seller: Ask the seller to reduce the price to match the appraisal. In a buyer's market, sellers often agree rather than risk losing the sale.

Make up the difference in cash: Pay the gap between the appraised value and purchase price out of pocket as an additional down payment.

Challenge the appraisal: Request a Reconsideration of Value (ROV) with additional comparable sales data the appraiser may have missed. Your agent can help compile this.

Walk away: If your contract includes an appraisal contingency, you can cancel the purchase and recover your earnest money.

Cost and Timeline

Appraisals cost $400-$600 for a standard single-family home. Complex properties or rural locations may cost more. The appraisal typically takes 1-2 weeks from order to delivery. FHA and VA appraisals have additional property condition requirements.