Your lender orders it, an independent appraiser walks the house within about a week, and a report comes back one to two weeks after the order. The buyer pays for it. Nationally that is $300 to $600 on a standard single-family home, and around Metro Detroit we see about $550. It is normally due up front or at closing.
Then one of two things happens. It comes in at or above your contract price and nobody thinks about it again. Or it comes in low, and the deal needs a decision.
Quick disambiguation first, because these get mixed up constantly. A lender’s appraisal is what this page is about: a licensed appraiser, hired by the bank, during an active transaction, to protect the bank’s collateral. A home valuation or CMA is what you get from an agent before you list, at no cost, to help you pick a price. If you are trying to figure out what your house is worth before selling, you want what is my home worth in Metro Detroit, not this page.
What is the appraisal timeline?
| Step | When | Who |
|---|---|---|
| Offer accepted, contract signed | Day 0 | Buyer and seller |
| Lender orders the appraisal | Day 1 to 5, after the inspection usually | Lender |
| Appraiser schedules and walks the property | Day 5 to 10 | Appraiser |
| Report delivered to the lender | Day 7 to 14 from order | Appraiser |
| Buyer receives a copy | Promptly on completion, or 3 business days before closing, whichever is earlier | Lender, by federal rule |
Most lenders wait until after the inspection period to order it, so you are not paying for an appraisal on a house you are about to walk away from over a cracked foundation. That is normal and it is in your interest.
The walkthrough itself is quick, usually 30 minutes to an hour on a standard single-family home. The appraiser measures, photographs, notes condition and updates, and checks that the home matches what the contract describes. The report then takes another three to ten business days to write and deliver. If you need it faster, most lenders can rush it for another $100 to $300.
On the copy rule: federal law (the Equal Credit Opportunity Act’s valuations rule) requires your lender to give you a copy promptly once it is done, or at least three business days before closing, whichever comes first. You can waive the timing and take it at closing instead, but there is rarely a good reason to.
What does an appraiser actually look at?
Three approaches exist in appraisal practice. On a house, one of them does almost all the work.
| Approach | What it does | Used on a home purchase? |
|---|---|---|
| Sales comparison | Compares recent similar sales nearby and adjusts for differences | Yes. This is the one. |
| Cost approach | What it would cost to rebuild, minus depreciation, plus land | Occasionally, on new or unusual construction |
| Income approach | Values it off the rent it produces | Rarely on a single family, standard on commercial |
For a Royal Oak bungalow, the appraiser is pulling three to five closed sales within about a mile from the last six months, then adjusting up or down for square footage, bed and bath count, garage, lot, condition, and updates. It is the same logic behind a good list price, which is why an accurately priced home usually appraises cleanly. We walk through that pricing logic in how to price your home to sell. For commercial property, where the income approach leads, see how to determine commercial property value.
How often does an appraisal come in low?
Roughly 8% to 10% of residential appraisals come in below the contract price. In early 2026 that figure sat near 8.6%.
So it is uncommon, but it is not rare. And when it happens, it matters: once the appraised value falls below contract price, renegotiation happens in more than half of those deals, and the rate climbs toward 80% as the gap widens.
Two situations raise your odds:
- You won a bidding war by a wide margin. If you went $30,000 over on a house with five offers, the appraiser is still working from closed comps, and your competing offers are not comps.
- The house is unusual for its block. A large addition, a rare floor plan, or an over-improved property in a modest neighborhood all narrow the comp set and widen the range.
What happens if the appraisal comes in low?
The lender will only lend against the appraised value, not the contract price. If you are buying at $400,000 with 20% down and it appraises at $380,000, the bank is lending against $380,000. The $20,000 gap has to come from somewhere.
You have five options.
1. Cover the gap in cash
You bring the difference on top of your down payment. Cleanest, fastest, and only possible if you have it. Note it does not change your down payment percentage requirement, it stacks on top.
2. Renegotiate the price
Ask the seller to come down to the appraised value, or to meet in the middle. This works more often than people expect, because the seller’s next buyer will likely face the same appraisal. Roughly half of low appraisals end in some renegotiation.
3. Split the difference
Seller drops some, you bring some. In a balanced market this is the most common landing spot.
4. Challenge the appraisal
Formally called a reconsideration of value. You submit better comps or point out factual errors, such as a missed finished basement or the wrong square footage. Success rates are modest and it takes a week or two, but it costs almost nothing to try when there is a real error to point at.
5. Walk away
If your contract has an appraisal contingency and you are inside its deadline, you can terminate and get your earnest money back. If you waived it to win the house, you cannot, and walking means losing that deposit.
This is why the appraisal contingency is worth talking about before you write the offer, not after. Waiving it is a real competitive tool and sometimes the right call. It is just not a free one.
What is an appraisal gap clause?
A term in your offer where you agree in advance to cover a shortfall up to a stated amount. “Buyer will cover an appraisal gap up to $15,000” tells the seller your financing will survive a modest low appraisal.
It became common during 2021 and 2022, when appraisal gap clauses appeared in more than 60% of winning offers in the hottest markets. They have fallen sharply since as markets balanced out, and in a Metro Detroit market where inventory just hit a five-year high you are far less likely to need one than a buyer in 2021 was.
Use it deliberately. It is a promise of cash you have to actually have.
How can a seller protect against a low appraisal?
You cannot control the appraiser. You can control what they walk in knowing.
- Have your agent meet them at the house with a one-page packet: the three comps supporting your price, a list of updates with dates and costs, and the square footage from the assessor if the listing differs.
- Name improvements the appraiser cannot see. New furnace, new roof, rewired electrical, new sewer line. These are real value and they are invisible from the living room.
- Price it correctly to begin with. An accurately priced home is built on the same comps the appraiser will pull. That alignment is the whole defense.
This is item 10 on the list of what your listing agent should be doing. If your agent is not planning to meet the appraiser, ask why.
How we handle it
We have sold thousands of houses across Metro Detroit since 1999, so we have been on both sides of a low appraisal plenty of times. Nobody enjoys the phone call. It is survivable almost every time.
- We meet the appraiser with the comps and the improvement list. Every time, on both sides of the deal.
- We talk about the appraisal contingency before you write, not after. Waiving it is sometimes right. It should never be an accident.
- When one comes in low, you get the five options and a recommendation the same day. Not a shrug.
Talk to an agent and we will walk you through where you stand. No cost, no obligation.
Frequently asked questions
How long does an appraisal take after an offer is accepted?
The report typically comes back one to two weeks after the lender orders it, and the lender usually orders it after the inspection period ends. The on-site visit takes about 30 minutes to an hour, then the appraiser needs another three to ten business days to pull comps and write the report. A rush usually adds $100 to $300.
Who pays for the appraisal?
The buyer pays, since it is part of the loan process. Nationally a standard single-family appraisal runs $300 to $600, with a recent national average near $357. In Metro Detroit we typically see about $550. Larger, rural, or unusual properties cost more, and VA and multi-family appraisals run higher.
When do I get a copy of the appraisal?
Federal law requires your lender to provide a copy promptly once the appraisal is complete, or at least three business days before closing, whichever comes first. That comes from the Equal Credit Opportunity Act’s valuations rule. You may waive the timing and receive it at closing instead, though seeing it earlier is almost always to your advantage.
How often do appraisals come in low?
About 8% to 10% of residential appraisals come in below the contract price, and that figure sat near 8.6% in early 2026. When it happens, more than half of those transactions end up renegotiated, and the renegotiation rate rises toward 80% as the gap gets larger.
What happens if the appraisal is lower than the offer?
The lender will only lend against the appraised value, so the difference has to be covered. You can pay the gap in cash, renegotiate the price with the seller, split the difference, formally challenge the appraisal with better comps, or terminate the contract if you have an appraisal contingency and are inside its deadline.
What are the three appraisal approaches?
Sales comparison, cost, and income. Sales comparison, which adjusts recent nearby sales for differences, does nearly all the work on a residential purchase. The cost approach is used mainly on new or unusual construction. The income approach values a property off the rent it produces and is standard on commercial rather than residential.
Can you challenge a low appraisal?
Yes, through a reconsideration of value. You submit stronger comparable sales or point out factual errors such as incorrect square footage or a missed finished basement. Success rates are moderate and it adds a week or two, but it is worth attempting when there is a genuine error rather than just a disagreement about value.
Is an appraisal the same as a home valuation?
No. An appraisal is ordered by a lender during an active transaction and performed by a licensed appraiser to protect the lender’s collateral. A home valuation or CMA is a pre-listing estimate from an agent, generally at no cost, used to help set a list price. They use similar comparable-sales logic but serve different purposes.