Home Purchase Appraisal Comes in Low - Now What?

Real Estate

What Happens When the Appraisal Comes in Low in the Vancouver Washington area?

   Low Appraisal Notice!!

Exclamation Shock


You are the lucky buyer!

You found the perfect house!  

You got pre-approved, you gave it your best shot with your offer, and you and the seller agreed on the purchase price.  Yay!

Now the work really begins. 

Mounds of Paperwork You supply mounds of paperwork to your lender, you secure homeowner’s insurance, you have a home inspection and seller makes repairs, you schedule your moving truck, and you wait and wait and wait for your appraisal.  Everything is done – all you need is the appraisal and THE APPRAISAL COMES IN LOW!  WHAT????

 Now what clip art

What do you do now?  What can you do? You put all the puzzle pieces together! 

  Puzzle house

You love that house!

In this crazy market with offers bidding up the purchase price we are seeing this scenario play out on occasion and each time it’s ended with a different outcome.

Of course, no one can force anyone to purchase a home for more than its stated worth, but sometimes the buyer doesn’t mind that the appraisal came in a bit low because he/she plans to stay in the home for a long time and can recoup all of the difference in short order.

By law in Washington State, there are some options but both buyer and seller must agree on the method to proceed.

According to the Northwest Multiple Listing Service, 2017, there is a form that a buyer’s agent can prepare titled Notice of Low Appraisal Form 22AN.

Source: NOTICE OF LOW APPRAISAL ©Copyright 2017 Northwest Multiple Listing Service


Essentially this form provides notice to the seller that the appraisal came in low and asks the seller the question, “which of the following options do you choose?”


1.    Seller chooses to get another appraisal at seller’s expense.  If that appraisal comes in at value, seller agrees to provide a copy to the buyer’s lender for approval.

2.    Seller chooses to reduce the purchase price to the appraised value. **

3.    Seller chooses to reduce the purchase price to an amount above the appraised value with the buyer making up the difference.

4.    Seller chooses to reject the low appraisal notice and chooses to do none of the above. 

** If seller chooses to reduce the purchase price to the appraised value nothing more needs to be decided. 

However, if seller chooses to lower the price to more than the appraised value or chooses to do nothing, now you, the buyer, have some options:

1.    You can waive the financing contingency meaning you will now pay cash.

2.    You can accept the lowered purchase price that is still more than the appraised value and choose to make up the difference.

3.    You can terminate the transaction.


Though this does not happen often, it does happen so it’s good to be mentally prepared and financially prepared 

knowing all of your options up front.



If you are ready to start the journey of finding your dream home, we would love an opportunity to assist you – at no cost to you, the buyer!


Just send us a quick message and let the search begin!


Ron and Sherry Patterson

Make Your Next Move Your Best Move!