What's an appraisal and why is it needed?

An appraisal is an independent estimate of a home's value, ordered by your lender. The lender uses it to make sure the loan amount is supported by what the home is worth. It is different from an inspection, which looks at the condition of the home. Sometimes an appraisal comes in low, and sometimes the appraiser simply doesn't have the full picture. When that happens, I work with the lender to give the appraiser strong comparable sales and documented upgrades with their costs and dates, and if needed we submit a formal rebuttal. In my experience, that has resolved low appraisals in my deals, but I can't promise the result on yours. Other options can include renegotiating the price, paying the difference, or ending the contract if your contract's financing terms allow it.