An appraisal contingency allows the buyer to renegotiate or cancel the contract if the home appraises for less than the agreed purchase price. Lenders require appraisals to make sure the home’s value supports the loan amount. If the appraisal comes in low, the buyer may ask for a price reduction, request the seller to split the difference, or offer to cover the gap in cash. Knowing your local market helps you prepare for appraisal outcomes.
