If the purchase amount of the property that is under contract equals or exceeds the appraised value of the property you can proceed to close.
If not, the contract busts unless both parties re-negotiate the contract.
The appraisal is usually performed by a certified appraiser who reports to either the buyer (if cash) or the lender (if financing).
If the seller refuses, you walk away, get your earnest money deposit back, and keep looking. The appraiser is working for you and your lender so they're going to make sure what you buy is worth what you're paying!
Real Estate Network Group
2601 Airport Drive #120
Torrance, Ca 90505 310-429-4170
Having a home appraised is an important part of the mortgage and home buying process.
An appraisal contingency is important to have, as it is protection for you, the buyer, should the house not "appraise out" .
If the house appraises at a number LESS than your offer, the sellers would have to lower the price to match it, or you would have the right to walk away --- now, this is what is usually done, I suggest you check this, and verify it with your agent or real estate attorney.
It means that if the Home that you are interested in Purchasing does not Appraise for as much as the purchase Price that you have negotiated, then the Sale transaction may not Continue. You need to look and read all of the Contract Details regarding exactly what happens if this were to happen. Do you get your Earnest Money back without Penalty? Can you continue the Sale if you want? Can another Appraisal or 2 be ordered? Typically, this clause is to your benefit if you are the Buyer.
You make me miss home (Fairfax VA).
Contingent on appraisal means your offer requires the appraisal to be at or above your offered contract price. It usually comes with a time frame to complete. A contingency is provision in the contract that needs to be removed before closing the transaction. It is best to ask your REALTOR according to what your time frame is. He/she is responsible to coordinate meeting that time frame with your loan officer.
Best of Luck with your home buying!