Selling a house can be a complex process with many potential setbacks, and one of the most significant is failing an appraisal inspection. There are two main issues that can arise during an appraisal: the home’s appraisal value coming in lower than the sales price, or the discovery of safety or repair issues with the property. Without passing an appraisal inspection, it is impossible to sell your Washington house, as buyers are required to pay for an appraisal as part of their mortgage application.
What Can I do if my Washington House has under Appraised?
The purpose of an appraisal is to determine the home’s fair market value, which allows the lender to ensure that the amount of money they lend to the buyer does not exceed the property’s value. If your house is under-appraised, it can be disheartening, as it may lead to a minor financial loss or even derail the sale entirely. However, there are several steps you can take to resolve an appraisal value issue, ranging from no-cost solutions to those with a more significant economic impact.
CONTEST THE APPRAISED VALUE
First, you can contest the appraised value by presenting data to support your sales price. Your real estate agent may be able to work with the appraiser to reconsider the appraisal value, especially if they have a good working relationship and credible information about comparable off-market sales.
ASK THE BUYER TO PAY FOR THE DIFFERENCE
Alternatively, you can ask the buyer to pay the difference between the appraised value and the contract sales price at closing. In a seller’s market where prices are rising rapidly, buyers may be willing to pay more to secure a property rather than waiting and paying more in the future.
NEGOTIATE WITH YOUR AGENT AND BUYER
If the above steps fail, you can negotiate with the buyer to meet in the middle by reducing the price of the house by half and requesting the buyer increase their offer by 50%. If you are unable to convince the buyer to pay more, you can consider reducing the price by a third, asking your agent to reduce their commission by a third, and requesting the buyer increase their offer by a third.
LOWER THE SALES PRICE TO THE APPRAISED VALUE
As a last resort, if you want to sell your house and a reduced sales price will not keep you from moving forward with your plans, you may have to reduce the price of your house to the appraised value.
In the event that the appraisal report highlights major repair issues, you may have to address them before the sale can proceed. However, if you want to sell your house quickly, you can consider selling to a “we buy houses for cash company” like Sound Home Buyer. Such companies can purchase Washington houses for cash, avoiding the need for bank appraisals and home inspections, and allowing you to sell your house “as is” without the usual headaches of selling through traditional channels.
Conclusion
Failing an appraisal inspection can be a significant setback when selling your house, but there are several steps you can take to resolve appraisal value issues or address repair issues, depending on your situation.