Steps to Successfully Challenge a Low Appraisal When Selling Your Home

What Causes a Low Appraisal?

The following factors drive low appraisals:

• Overbidding: In order to secure a home, buyers may occasionally bid more than the asking amount. While this may help you approve your offer, it will not help you acquire financing. Mortgage lenders will only fund a house purchase if the appraised value is close to or greater than the selling price.
• Rising house prices: Even if you did not technically overbid based on market conditions, the new market standards may not have been reflected in your property appraisal. Appraisals use precedent to determine home selling prices; if not enough homes sell at the new market standard, the home will not rate for that price.
• Comps are scarce or of poor quality: The precedent that appraisers look to when evaluating the market value of a home is set by comps, or “comparables” - homes in the region with identical qualities as the one being appraised. If there aren’t enough comps in the neighborhood, or if the comps in the region don’t represent the home’s condition, the appraiser may not have enough basis to value the home at the asking price.
  

How to File an Appeal for a Home Appraisal 

If your appraisal was low, don’t freak out. Here’s how to appeal against a home appraisal:

Examine the evaluation

The first step in appealing your appraisal is to gather tangible evidence that it is incorrect. Remember that appraisers must adhere to a strict code of ethics in order to stay objective in their assessments. Your appeal must be equally objective in order to be successful. Look for the following when reviewing the appraisal:

• Clerical errors: Even appraisers make errors. Examine their computations to ensure that there are no errors or omissions.
• Recent house improvements: Appraisers use precedent to determine the present worth of a home. If you made recent improvements that were not included in the floor plans or comps reviewed by the appraiser, you may have grounds for reconsideration.
• Aesthetic evaluation: Lenders have begun accepting desktop appraisals for house transactions because of long wait times. This method evaluates the residence using digital methodology rather than an in-person walkthrough. These appraisals are generally accurate, although appraisers can make mistakes, especially when they do not have the opportunity to inspect the property in person. If your appraiser employed this method, double-check to ensure they didn’t miss something obvious in person (such as the size of the home and property).
  

Review the Comparables

Comps are a vital foundation for appraisers, and erroneous real estate comps can significantly influence their evaluated worth. Examine the ones the appraiser uses to see if they fit your home appropriately. To guide your investigation, use the following prompts:

• Characteristics of the property. Do the comparables share features (for example, an inground pool, a remodeled primary bathroom, or a mother-in-law suite)? Do they have the same amount of space? Is each one the same type of house (for example, a two-bedroom bungalow)? 
• Location. Does the appraiser consider the comparables in close proximity? If not, seek for comparables in your community. 
• Timing. Are the comparisons outdated? In a hot market, home values can fluctuate quickly. Check that the appraiser used the most recent comparables.

If you have cause to feel the comparables are not comparable to your house, explain why they are incorrect and provide alternatives for greater clarity.

Submit a Value Reconsideration Request

Once you’ve obtained your proof, include it in your value reassessment. A borrower might use this formal method to request that an appraiser examine their assessment to verify accuracy. It is not and cannot include a request for a different home valuation. Although it is uncommon, appraisers may revise their appraised value if they agree with the provided evidence.

Find an Appealer Who Knows the Area

Every neighborhood and town has unique characteristics, which is why your appraiser must know about your specific location. If an appraiser lives more than 50 or 100 miles away, he may not be the appropriate person to give a value to your home. If you have any issues, call your lender right away. An evaluation by someone unfamiliar with your neighborhood could be a valid ground for a value appeal.

Don’t be Hesitant to Seek Assistance

Buyers and sellers are on the same side when an appraisal comes in at the selling price. To appeal, all parties must work together and rely on the skills of their real estate agent. Agents can be especially useful in examining the complexities of comparables and a home’s physical attributes. However, you don’t have to hire an agent if you don’t have the money. 

You can seek the help of a cash home buyer Lebanon. These buyers include we buy houses Lebanon organizations and investors, who buy houses for cash quickly. They are the ideal choice if you want to sell my house fast Lebanon, as they can help you appeal the home appraisal. If anything, when you Sell my house fast Lancaster, you don’t need a home appraisal from a professional, as the cash buyer can complete the appraisal on your behalf. 

When you’re ready to submit your reconsideration, collaborate with your mortgage officer to explain your findings in the format that their company prefers. This ensures that your appeal will not be dismissed due to formalities.

Give us a call anytime at 484-484-0971 or fill out this quick form to get started today!