Assuming you're financing your home purchase with a loan, the lender will order an appraisal to be performed on the property to assess the property's value. An appraisal is normally ordered after the inspection contingency is satisfied and is generally the final contingency of the transaction before funding and closing. The lender is looking for the property to appraise at or above the sales price in order to fund the purchase as previously agreed upon. If the home does not appraise at or above the sales price, there are several avenues we can take to rearrange funding for the transaction. (1) If we truly feel the property has been inaccurately assessed, we can challenge the appraisal by sending in different comparable properties or any information we have that may dispute the appraised value in the hopes that they will raise the appraised value. (2) The seller can agree to lower the purchase price to match the appraised value and the transaction will proceed at this new lower price. (3) The buyer (you) can bring in the difference in the appraised value in addition to the down payment. (4) If none of these options are feasible for both parties, we can terminate the transaction and your earnest money will be refunded.