If your buyer is obtaining financing! Oh sure there are other options. The buyer could pay the difference in cash or the buyer and seller could split the difference but NOT in today's market.
This is a buyer's market.
The purpose of an appraisal is to ensure the buyer doesn't pay more than the property is worth. Would you pay more than a home was worth?
The lender won't. The lender wants to make sure that the house is worth the sales price because if the buyer were to default on the loan, the lender wants to make sure they can recover their loss.
The buyer won't either. Buyers want to know that they are making a GOOD investment. One that will appreciate, build equity and supply the most money possible when they sell.
In addition, if it's an FHA buyer (and because of the recent changes in the lending rules that's what most first-time homebuyers will be because of the low downpayment requirements - 3.5% ) that appraisal will remain on the FHA records for 6 months.
In a sellers market or if the property is especially desirable a buyer may be interested in paying more than appraised value but that buyer must have the cash for the difference because the lender won't make a loan for more than appraised value minus the downpayment.
The appraisal prosses is designed to protect the buyer and the lender from over paying for a property.
Robin Scott, BROKER. Certified Residential Specialist, Accredited Buyer's Representative, Seller's Representative Specialist. Amelia Bullock Realtors. 512.589.7988.
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