Jon Griffith

Yes, I have seen this happen. In recent instances where a less experienced appraiser botched the appraisal and gave a ridiculously low number to the buyer's lender, it was disputed, and properly adjusted.

If the sales price is a fair market value, and the low appraisal is incorrect, there's no reason it shouldn't be adjusted by way of a new appraisal.

If the sales price is over fair market value, and the lower appraisal is more realistic, then you as the buyer have a decision to make. You can either come out of pocket and pay the higher price, covering the difference from what your lender will lend, or you can take the appraisal to the listing agent and negotiate a lower price.

As soon as the seller sees the appraisal, they will probably want to dispute it right off the bat, especially if their expectations are out of line with market value. After all, it is their home, and they are emotionally attached to it, so "obviously it's worth what they say it's worth." But we all know that's not the truth, and the reality is that their agent is probably relieved that he now has more evidence that the price needs to come down for future marketing purposes, especially since you may be ready to walk away because you can't cover the difference. - Thu Oct 1 2009, 10:52