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Appraisal Lower Than The Purchase Price?
Uh oh! What happens if after you've made an offer on a house and you're now working with your lender and their appraiser came in with a value less than the purchase price?
This has happened on many occasions and hopefully your agent has put in the contract a provision that deals with this eventuality. Since you cannot get a loan for more than the appraised value, and the seller will have a difficult time finding another buyer who is willing to pay more than the home is worth, it is in the interest of both parties to try to work this situation out. Normally, you would try to get the seller to agree to a lower price that would match the appraisal. If the seller balks at this idea, and you absolutely love the house, you can consider paying the difference between the purchase price and the appraised value in cash, through a higher down payment. If you are not in a position to do this, the only remaining option is to cancel the contract and look for another home. But, again, this must have been clearly spelled out in the contract in the very beginning so that you don't lose ... more

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