# How to Contest a Home Appraisal When You and the Appraiser Disagree

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When it comes to real estate, whether you are selling or buying a home, it is quite possible that what you think your home is worth and the figure the appraiser comes back with are two different numbers. If the difference is nominal, it may not make a difference in the sale going through or the amount of the mortgage you receive from the lender.

If the difference in figures is significant, it can jeopardize the sale of the home or your ability to refinance or obtain a second mortgage on your home—ultimately affecting the amount of money you get out of the home. Fortunately, all you have to do is learn how to contest a home appraisal, which proves that your home is worth a different amount than what the appraiser is showing to prove you should get the sales price, buying price or mortgage amount you seek.

## Find Comparables

One of the first thing an appraiser does when he or she returns to his office after viewing your home is to pull comparables or comps for other homes in your area. You can research and find your own comps to share with the appraiser/mortgage company to prove the value of your home. When you are looking for comps, some characteristics are important to look for in your comps:

• Same/similar square footage as your home
• Within one to five miles of your home
• Same type of home (single-family, condo, townhome, etc.)
• Similar amenities

You want to look for comps that include both homes that currently up for sale and those homes which have sold in the last six months or less. Divide the listing or sales price of the home by the number of square footage, which provides you a price per square foot. Then multiply this number by the square footage of your home.

For example, if the average sales price of a 2,000 square foot home is \$150,000, then you would divide \$150,000 by 2,000 square feet to get the answer of \$75 a square foot. If your home is 1,800 square feet and fits the other criteria to be a comp, then you would multiply \$75 by 1,800 square feet to come up with an approximate value of \$135,000.

## Broker Price Opinion

You can also get a Broker Price Opinion (BPO) from a licensed real estate professional. A professional real estate agent can also do the behind-the-scenes research to estimate the value of the home. They can pull up records from the multiple listing service (MLS). The MLS is a subscription-based service real estate agents use to see the prices of homes that are similar to your home. Again, they are looking for the same characteristics you would be looking for if you figured out this information on your own. The advantage is they may be able to find the information faster and easier than you can.

If you are already working with a real estate agent to buy or sell the home, they will typically perform a BPO at no charge. If you simply approach a real estate agent seeking a BPO, then there may be a small charge for their time. They will provide you a written report of their findings that includes the comps they used and how they determined the approximate value of your home.

## Hire Another Appraiser

Third, you have the option to have another appraisal company conduct an appraisal–most mortgage companies take the average of the two or the lower of the two, so find out first if it is a financing issue. The major disadvantage of this option is that you will have to pay the cost for two appraisals. You will have to pay for the original appraisal and then the second appraisal.

How to contest a home appraisal does not require you to pick one option over the other. Once you gather the information that proves the value of your home is different from the value your appraiser came up with, you then have to provide your proof to lender, appraiser, mortgage company or private seller or buyer that is involved in the transaction.

If you have adequate proof the value you have calculated is different from that of the original appraisal, the value may be changed. The appraiser, mortgage company or private parties do not have to accept the new value determined. If the proof is strong enough, however, it is usually enough to convince the parties involved so that the deal can go through.