How to Appeal a Low Appraisal

Nadia Kafaipour
Feb 26
2 min read

A low appraisal can feel like a deal breaker — but it doesn’t always mean the transaction is over. Whether you’re a buyer or seller, there are steps you can take to challenge or work through a lower-than-expected valuation.

Here’s how to handle it strategically.

📉 What Is a Low Appraisal?

A low appraisal happens when the appraiser’s valuation comes in below the agreed purchase price.

This creates a problem because:

Lenders base loan amounts on the appraised value — not the contract price.
If the value is lower, the lender won’t finance the difference.

That gap has to be addressed before closing.

📝 Step 1: Review the Appraisal Report Carefully

Don’t assume it’s correct without reviewing details.

Check for:

Incorrect square footage
Missing upgrades or renovations
Wrong number of bedrooms/bathrooms
Outdated or distant comparable sales (comps)
Obvious data errors

Even small inaccuracies can impact value.

📊 Step 2: Gather Better Comparable Sales

If stronger comps exist, your agent can submit:

Recent sales closer in proximity
Homes with similar upgrades
Properties that closed after the appraiser’s selected comps

Timing matters — the newer the data, the stronger the case.

📬 Step 3: Submit a Reconsideration of Value (ROV)

Your lender can formally request a Reconsideration of Value (ROV) from the appraiser.

This typically includes:

A written explanation
Supporting comparable sales
Documentation of upgrades
Evidence of market trends

The appraiser may adjust the value — or stand by their original opinion.

💰 Step 4: Consider Other Solutions

If the appeal doesn’t change the value, you still have options:

🔹 Buyer Pays the Difference

The buyer brings additional cash to closing.

🔹 Seller Reduces the Price

The seller agrees to meet the appraised value.

🔹 Split the Difference

Both parties compromise.

🔹 Appraisal Gap Clause

If included in the contract, the buyer may already agree to cover a set amount above appraisal.

🏦 Can You Order a Second Appraisal?

Generally, lenders control the appraisal process. A second appraisal is uncommon unless:

There were clear errors
The first appraisal was flawed
The lender approves a new valuation

Switching lenders could mean starting the process over.

🚨 What NOT to Do

❌ Panic immediately

❌ Confront the appraiser directly

❌ Ignore timelines

❌ Assume the deal is dead

Low appraisals are common in rapidly changing markets.

📈 Why Low Appraisals Happen

Rapid price increases
Limited comparable sales
Unique property features
Overly aggressive pricing
Conservative valuation approach

Appraisers rely on data — not emotion.

The Bottom Line

A low appraisal doesn’t automatically kill a deal. It’s a negotiation point — not a final verdict.

With the right approach, you can:

✔ Correct factual errors

✔ Strengthen comparable data

✔ Renegotiate strategically

✔ Keep the transaction alive

Preparation, data, and calm negotiation make all the difference.