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Are Appraisals Keeping Up With the Market?

Dear Monica: In talking to my lender, I found out that some appraisals lately have come in at less than the purchase price. Should buyers especially be worried about this? Jack B.
 
Dear Jack: It’s true that some appraisals are coming in lower than the contract price. In our somewhat overheated market, this is not a surprising turn. Interest rates have risen sharply and even though employment is strong, there is negative economic news making lenders be more cautious. Know that if you are a buyer with no contingencies, you should be prepared to make a higher down payment if the property doesn’t appraise at the contract price.

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