What to Do If Your Appraisal Comes In Low in Illinois: Options for Buyers and Sellers in the Western Suburbs
A low appraisal does not have to end your deal. When the appraisal comes in under the contract price, buyers and sellers usually have four options: lower the price, cover the gap in cash, split the difference, or challenge the appraisal. If none of those work and the buyer has an appraisal contingency, the buyer may be able to walk away. Here is how each option plays out in Naperville, Aurora, Oswego, and Plainfield, Illinois.
Why a Low Appraisal Matters
When a buyer gets a mortgage, the lender hires an appraiser to confirm the home is worth what the buyer is paying. The lender will only lend based on the lower of the price or the appraised value.
So if you agree on $450,000 and the home appraises at $435,000, there is a $15,000 gap. Somebody has to solve it, or the numbers stop working.
This happens more in fast-moving markets. When prices climb quickly, sales from a few months ago can lag behind what buyers are paying today. Illinois REALTORS® reported the statewide median price was up 6% year over year in July, which is the kind of climb that can outrun the comps. You can see the latest data on the Illinois REALTORS® market stats page.
We covered what the appraiser is actually checking in our post on what appraisers look for in your home.
Your 4 Options When the Appraisal Comes In Low
- The seller lowers the price to the appraised value. This is often the cleanest fix. When a client calls us upset about a low appraisal, our first option is usually to go back to the sellers and ask them to reduce to the appraised value.
- The buyer covers the gap in cash. If the buyer has the savings and really wants the home, they can pay the difference on top of their down payment.
- Meet in the middle. The seller drops part of the way, and the buyer covers the rest. This is how a lot of these end.
- Challenge the appraisal. If the appraiser missed a good comp or got a detail wrong, like square footage or a finished basement, the lender can be asked to review it. This is often called a "reconsideration of value."
If none of these work, what happens next depends on the contract. If the buyer has an appraisal contingency, they may be able to cancel and get their earnest money back. We explained how that works in our post on contingencies in Illinois real estate.
What Sellers in the Western Suburbs Should Know
If you are selling, a low appraisal is not a personal insult. It is a snapshot based on recent sales. But you can help your odds before it ever happens.
- Price from real data. Homes priced right from day one appraise more easily. Our post on how to price your home explains our approach.
- Give the appraiser a list of updates. New roof, new furnace, finished basement? Put it on one page with dates and costs.
- Share strong comps. Your agent can hand the appraiser recent sales that support the price.
A quick note on rates. With 30-year mortgages back above 7% in late September per Freddie Mac, many buyers are stretched. That can make it harder for them to cover an appraisal gap in cash. Sellers who plan for that tend to keep their deals together.
How We Handle Low Appraisals
We're Julia Corkey and Vickie Schoenfeld with Team Elite Realtors, and a low appraisal is something we handle calmly and fast. We start with empathy, because it is stressful. Then we lay out the plan.
We use a tool called RealReports that pulls data from over 30 sources on every home. That helps us spot comps and details an appraiser may have missed. We're with Baird and Warner, which was the first brokerage in Illinois to put listings online back in the 1990s, and that tech-forward mindset still shows up in how we work.
Buying or selling soon? Book a consultation and we will walk you through how to protect yourself before the appraisal ever happens. You can also read what past clients say in our Google Reviews.
Frequently Asked Questions
What happens if my home appraisal comes in low in Illinois? The buyer and seller usually renegotiate. The seller can lower the price, the buyer can cover the gap, or both can meet in the middle. The appraisal can also be challenged if there are errors.
Can a buyer back out if the appraisal is low? Often yes, if the contract includes an appraisal contingency. Check your contract and talk with your attorney and agent.
How do I dispute a low appraisal? Ask your lender for a reconsideration of value. Give them better comps or correct any mistakes in the report. Your agent can help pull the data.
Is there a Realtor near me in Plainfield or Naperville who can help with a low appraisal? Yes. We're Julia Corkey and Vickie Schoenfeld with Team Elite Realtors at Baird and Warner, serving Naperville, Aurora, Oswego, and Plainfield for over 20 years. Call 630-286-9777.
Want to know what your home might appraise for before you list? Start with a free instant market analysis. Shopping for a home instead? Get alerts the minute new listings hit on Zenlist. And if you want to learn more about the full home buying process, the CFPB's Owning a Home guide is a great free resource.
Ready to make your next move in the western suburbs of Chicago?
We are here to help you every step of the way, whether you are buying, selling, or just exploring your options.
Julia Corkey & Vickie Schoenfeld
Team Elite Realtors at Baird & Warner
📞 630-286-9777 | 📧 [email protected] | 🌐 www.homesbyteamelite.com
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