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  • Omega Financial Mortgage

What if Your Home Appraisal Comes in Too Low?

With the hot housing market, bidding above asking price has almost become the norm. Unfortunately, this trend has led to problems for some buyers: An appraisal that comes back lower than the agreed-to selling price.

What can you do if this happens to you? First of all, you shouldn’t panic because you do have options.

Negotiate a lower price. Although this strategy may not work in the current market—since a seller may be able to line up another buyer fairly easily—it could be an option worth trying. In some situations, a seller will negotiate with you on the price if they believe that an appraisal problem could happen with another buyer as well. Also, they may be willing to negotiate if they don’t have any other bids on the home or if the next best bid is significantly lower.

Have the appraisal reviewed or redone. A home appraiser can make mistakes, so make sure you review the appraisal thoroughly. Mistakes may include an overlooked capital improvement, wrong square footage or number of rooms or simply a mathematical error. You can also ask the lender to have another appraisal completed, although the lender may not agree. If they do agree, be forewarned that you may have to pay for it out of pocket.

Make up the difference in cash. This is the most common solution when the home appraisal comes back lower than the selling price. Obviously, it’s not an appealing option, but if you really want to buy the home, this may be your best bet. The funds can come from a variety of sources such as gift money from family, adjusting your down payment, cashing out an investment, or simply tapping into savings.

Each scenario does have its pros and cons and each situation is different, so make sure to talk to your real estate agent and mortgage professional about your options. Also, you should know that in some cases you may have other options available to you besides the ones listed above.


For more than 25 years, Omega Financial has been serving mortgage clients in Massachusetts. Our brokers have approximately 50 years in the mortgage business. You always will receive fast, courteous, and accurate information. Omega Financial, Inc. is a company duly licensed to operate in Massachusetts as a Mortgage Brokerage. We are located in the Town of Norwood, Massachusetts where we have been operating as Omega Financial Incorporated since 1988.

Licensed by the Commissioner of Banks - License No. MB2671

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