What Happens If the Appraisal Comes in Low?

You’ve made it through inspections, you’re excited for closing… and then your lender calls: “The appraisal came in low.”

It’s one of the most stressful moments in a real estate transaction—but it doesn’t have to kill your deal.

In Lubbock’s 2025 market, low appraisals happen more often than you might think, especially in fast-moving neighborhoods or new construction areas where sales data can lag behind actual demand.

Here’s what’s really going on: an appraisal reflects the past, not the present.
Appraisers compare your home to recently sold properties (“comps”) nearby. But if the market’s moving quickly, recent sales may not yet reflect today’s higher values.

So what can you do if the appraisal comes in under contract price?

1. Renegotiate the Price
The simplest option: ask the seller to lower the price to match the appraised value. If the seller’s motivated, this often works—especially if the property’s been on the market a while.

2. Split the Difference
Sometimes buyer and seller meet in the middle. For example, if a home appraises $10,000 low, the seller may drop $5,000 and the buyer brings $5,000 in cash.

3. Cover the Gap
You can bring extra cash to closing to cover the difference between the appraised value and contract price. This is common in competitive Lubbock neighborhoods, where demand pushes prices faster than appraisals can keep up.

4. Challenge the Appraisal
If you believe the appraiser missed something—like recent upgrades or better comparable sales—you can request a Reconsideration of Value. It’s not a guarantee, but I’ve seen it work when strong data is presented.

5. Cancel the Contract
If neither side can agree, the appraisal contingency allows the buyer to back out and keep their earnest money.

As your Realtor, I help interpret the report, identify negotiation leverage, and communicate directly with your lender and the listing agent to find a balanced solution.

Low appraisals aren’t personal—they’re procedural. And with the right approach, they’re fixable.

The best defense is preparation. Before you even make an offer, I pull neighborhood comps and discuss potential appraisal risks. That way, if one comes in low, we already have a plan.

In short: a low appraisal is a hurdle, not a dead end. And in Lubbock real estate, strategy always outruns panic.

— Insights from Tess Hernandez, Realtor | Reside Real Estate