What is Low Appraisal Coverage
And how is it affecting getting an offer accepted:
What is low appraisal coverage
How it affects you as a buyer or seller
How you can use it as a strategy as a buyer
Watch the video to get the full breakdown
How do appraisals affect your ability to win a home in this market?
That is a complex question and one that is on the top of every buyers and seller's minds at the moment in our market.
With homes escalating well over list price, every seller is looking to accept an offer where the buyer is taking the risk off their shoulders.
Your loan is based off the appraised amount, not off the contract price. So if the home is under contract for $800,000, but only appraises for $750,000, sellers are looking for a buyer that can still close at the contracted price.
The only way to make up this difference is with cash.
We often will coach out clients to lower their own payment amount and increase their low appraisal coverage in their offer. This will typically result in a much higher chance of winning the home, and keeps your cash to close roughly the same.
When you offer on a home, it is important to realize that the strength of the escalation is only as good as the buyers ability to cover the increased price if it does not appraise for the higher value.
Are you ready to take the next steps toward buying or selling your home?
When you work with The Novak Team, you are putting to work the vast experience of some of the top agents in the industry, not just the area. Tap the link below to schedule a zero commitment consultation with me to see if it would be a good fit.