All Forum Posts by: Abdul Azeez

 Wrong. But again depends on your contract. You can’t send a notice “assuming” the deal is still alive. The contingency is likely in their favor. They gave you notice of low appraisal and complied with their $5k gap. If the deal is not at that price point, there is no deal. The deal is off but you can renegotiate. Your response of “thanks for complying with the terms of the original deal but we’ll assume we are moving forward with a price point outside of the original deal anyways unless you tell us to the contrary once again” doesn’t work and is not a renegotiation. There might be more to it. Very hard to comment without having reviewed the transaction docs…

Not being familiar with your area’s standard forms I’d say that 99% of the appraisal contingencies I’ve seen either expire automatically (the buyer waives it) or require the buyer to give notice of low appraisal at which point the deal is either renegotiated or cancelled depending on what they say in their notice.
Check that language. If what I am used to is mirrored in your PSA and you (or your agent) haven’t received any notices, your buyer waived the contingency and you keep earnest money if they fail to close (unless there are other contingencies allowing the buyer to terminate).

What is in writing? The buyer either has or has not waived the appraisal gap contingency either choosing to proceed to closing or cancelling the deal. Waiting to hear something is not contractual unless you are within the contingency period and the buyer has time to either cancel or waive. Some documents and notices should’ve been exchanged if you are out of the contingency period

The buyer could still voluntarily pay the extra difference. I suppose the seller could choose not to accept the extra $$$ from the buyer and force the cancellation of the contract but why would the seller do that if the property is about to sell well above appraisal?

I am stuck here a bit.

“the appraisal comes lesser than the offer amount and if the $x over appraised value still leaves a lot of difference from the offer price”

Is the difference mentioned above higher or lower than the contract?

Say contract is $100k. Appraisal gap contingency is $10k

Did the appraisal come in at $85k? If so, $85k + $10k = $95k. The buyer gets to walk if they want (or voluntarily pay $5k more). Nothing the seller can do

OR

Did the appraisal come in at $95k? If so, Buyer must purchase at $100k (original contract is within the appraisal plus contingency gap). Seller must sell at $100k. Seller cannot walk OR demand $105k (appraisal plus full appraisal contingency gap)

@Abdul Azeez No, you don’t have to sell for less than the contract price.  The contract price is still the price….this clause just obligates the buyer to pay up to $10k above appraisal, to meet the contract price.  It doesn’t obligate the seller to accept less than the contract price. The buyer and their agent will lose this battle.

Are you the seller or buyer? 

I would advise for you to speak with your title company that is closing the deal. I just recently had this situation and made sure to include the proper wording for my seller.