You have made an offer on a home for sale, and you are in the process of securing financing for your home. There is an appraisal contingency. What does that mean to you? It means that if the appraisal does not come in at the purchase price, you can offer to renegotiate the price. I recommend getting an appraisal even if YOU ARE PAYING CASH!
I would not recommend paying more for the property than it appraises for. If it comes in lower than the purchase price, you have some options.
- You can walk away, because the appraisal contingency is part of the contract, and if the property does not appraise, that is a contingency that you can use to end the contract.
- Renegotiate the purchase price – offer to pay the price that the property came in at. If you really want the property, that is a consideration. Offer the appraised value to the seller, and see what their response is. It is up to you, if they don’t want to lower it, then it may be time to find another property.
- You “may” want to consider paying more than purchase price – bring cash to close the deal. This is NOT something that I recommend for my buyers.
Keep in mind, if you are obtaining a loan on your property, then it is imperative that is appraises. Even for cash buyers!!
If I can answer any questions about Newport Beach homes for sale and their appraisals, please contact me.