The appraisal came in low. What actually happens next

When an appraisal on a refinance comes in below expectation, the loan-to-value rises and the consequences follow: a smaller cash-out, a worse rate tier, mortgage insurance where there was none, or a declined file. The first step is to read the report rather than react to the number. The comparable sales are listed with adjustments. Look for comparables outside the immediate area when closer ones existed, sales that predate a market move, a missed bedroom or bathroom count, square footage that does not match the county record, or renovations that were not reflected. The formal route is a reconsideration of value, submitted through the lender. It works when it is evidence: specific closed sales with addresses and dates that the appraiser did not use, a correction of a factual error, or documentation of improvements with permits and costs. It does not work as an assertion that the property is worth more. Borrowers also have the right to a copy of the appraisal, and on most transactions the lender must provide it. If the value stands, the options are ordinary. Bring cash to the closing to reduce the loan amount. Take the smaller cash-out. Wait, particularly if the comparables reflected a slow stretch. Or pay for a second appraisal with a different lender, understanding that the first report does not disappear. Preparation reduces the odds of getting here: a clean, accessible property, a list of improvements with dates and costs, and recent comparable sales handed over at the inspection. This article is general information, not legal, tax or financial advice. Rules change and every deal is different — check your own case with a licensed professional. Alberto Zaltzberg — Adonait · adonait.com