You find the right home in Glendale, write a strong offer, then the appraisal comes in low. Now what? If you are buying in the West Valley, this moment can feel stressful and confusing. You want to keep your purchase on track without overpaying or risking your financing.
In this guide, you will learn exactly what an appraisal gap is, why it has been common in Glendale and nearby communities, how the appraisal process works, and the practical options you have if the value comes in below your contract price. You will also get a simple decision tree and a checklist you can use right away. Let’s dive in.
Appraisal gap basics
An appraisal gap is the difference between your agreed-upon purchase price and the value opinion from a licensed appraiser. If your contract price is 420,000 and the appraisal is 400,000, the gap is 20,000. Lenders usually base your loan on the lower of the appraised value or the contract price.
When the appraised value is lower, the lender reduces the loan amount. You must either bring extra cash to closing, renegotiate the price or terms, or cancel if your contract allows. For a helpful consumer overview of appraisals and what happens when values come in low, review the Consumer Financial Protection Bureau’s guidance on low appraisals.
- Learn more: the CFPB explains what happens when the appraised value is lower than the sale price in its consumer guide on low appraisals.
Why gaps happen in Glendale
Glendale and nearby West Valley neighborhoods have seen periods of rapid price growth in recent years. When prices move up faster than closed sales can confirm those increases, appraisals can lag behind current contract prices.
Multiple-offer situations add pressure. In a tight inventory environment, buyers sometimes bid above the most recent comparable sales. Appraisers must prioritize closed comparables that may be several weeks or months old.
New construction and unique remodels are common in the West Valley. Fresh subdivisions, different floor plans, and custom upgrades can be hard to match to recent nearby sales. Appraisers may expand their search area if local comps are limited, which can dilute micro-neighborhood demand.
Loan type matters too. FHA and VA appraisals include minimum property standards. Needed repairs or condition items can affect the valuation and your timeline. Conventional appraisals focus on market value and loan-to-value, while FHA and VA add property condition criteria.
Appraisal process and timing in Arizona
Once your lender orders the appraisal, plan for about 5 to 10 business days for inspection, analysis, and reporting. Timing depends on lender workflow, appraiser availability, property complexity, and loan type.
The appraiser will tour the home, verify key features, research comparable sales, adjust for differences, and deliver a written opinion of value. Most single-family homes use a Uniform Residential Appraisal Report. FHA and VA have additional form requirements tied to property standards.
Appraisers are independent and licensed, and they follow national standards. For Arizona consumer resources and oversight information, visit the Arizona Department of Real Estate’s consumer page.
- Helpful resource: review the ADRE consumer guidance for general real estate processes and oversight in Arizona.
Reduce risk before you write an offer
You cannot eliminate appraisal risk completely, but you can plan for it and keep control of your budget.
Buyer strategies
- Build a cash cushion. A larger down payment or reserves give you flexibility if a gap appears.
- Use a clear appraisal contingency. Set a timeline and define remedies, such as renegotiation, paying a capped amount, or canceling if needed.
- Clarify escalation terms. If you use an escalation clause, specify whether you will escalate above the appraised value or only above competing offers.
Seller strategies
- Price with realistic comps. Use the most recent local closed sales and highlight true like-for-like comparisons.
- Prepare an appraisal packet. Give your listing agent a clear set of facts so the appraiser has accurate data.
Appraisal packet checklist
Provide these items through your agent or lender to the appraiser and keep copies for your records:
- A list of the most recent and most similar closed sales nearby
- A summary of upgrades with dates, costs, and permits
- HOA information, fees, and community amenities that affect value
- Accurate square footage, floor plan, and builder specs if available
- Photos and receipts for major systems, landscaping, and exterior work
- Notes on neighborhood changes that may affect demand, such as new services or road improvements
If the appraisal comes in low: your options
A low appraisal is not the end of the deal. You have several paths forward. Your contract will guide deadlines and rights, so review it with your agent.
- Pay the gap in cash. You bring additional funds so the loan-to-value still meets your lender’s rules. Your loan amount will be based on the appraised value.
- Renegotiate the price or share the gap. Buyer and seller can reduce the price to the appraised value or split the difference with a mix of price change and credits.
- Request a reconsideration of value. Your lender can submit new factual data, better comps, or corrections to the appraiser. Appraisers remain independent and will only revise value if strong evidence supports a change. For a high-level look at how lenders handle reconsiderations, see Freddie Mac’s appraisal reconsideration of value FAQs.
- Ask for a second appraisal. Sometimes the lender can order a desk review or a new appraisal, subject to their policies. This is not guaranteed and may add time and cost.
- Change financing structure. You might adjust your down payment, loan program, or closing credits to keep the deal workable, subject to lender approval.
- Terminate under your contingency. If permitted by your contract and timeline, you can cancel and recover your earnest money.
Loan type differences
Your options and requirements can vary by financing.
- Conventional loans. The appraised value governs the maximum loan-to-value. Lenders may allow reconsideration or a review appraisal at their discretion.
- FHA loans. Appraisals also enforce minimum property standards. Repairs may be required before closing, and condition items can affect value. You can review FHA policy in HUD’s Single Family Housing Policy Handbook.
- VA loans. VA appraisals apply their own standards, and condition issues may trigger repairs. Learn more about the VA appraisal process on the VA Home Loans site.
- Cash purchases. No lender appraisal is required, but you can still order an appraisal for your own assurance. Any gap becomes a personal value decision.
Resources:
- FHA minimum property and appraisal policy: see HUD’s Single Family Housing Policy Handbook.
- VA appraisal process overview: see the VA Home Loans appraiser information page.
Simple decision tree for low appraisals
Use this quick flow to choose your next step:
- Did the appraisal meet or exceed the contract price?
- Yes. Proceed to closing.
- No. Move to step 2.
- Check your contract for appraisal or financing contingencies and deadlines.
- If it allows termination, you can renegotiate, agree to cover the gap, or cancel within the timeframe.
- Want to renegotiate?
- Propose a price reduction to appraised value or a split of the gap. If agreement is reached, the lender updates figures and you move forward.
- Want to challenge the appraisal?
- Gather better comps, correct factual errors like square footage, and submit through your lender for a reconsideration. If the value is revised, proceed. If not, return to step 3 or 5.
- Ready to cover the gap?
- Confirm cash funds and loan-to-value with your lender. Proceed to closing.
- If none of the above work, use your contingency rights to cancel within the allowed window.
Smart communication and timing
Appraisal windows are short. Act fast and keep documentation clean and factual.
- Present your packet early. Get your comps and upgrades to the appraiser through the proper channels right away. Do not pressure the appraiser. Stick to facts.
- Correct errors quickly. If square footage, bedroom count, or permitted work is wrong, supply proof promptly.
- Coordinate with your lender. They manage formal reconsideration requests and any second appraisal options.
Appraisals vs. property taxes
Your tax assessed value is not the same as a lender’s market appraisal. Assessments follow different timelines and methods, and they often lag market conditions. For local property assessment information, visit the Maricopa County Assessor.
Protect your budget in a hot market
Covering a gap can help you win a home you love, but think about your long-term plan. A larger cash outlay reduces your cushion for improvements, emergencies, or future moves. If you expect to hold the home for several years, small gaps may matter less. If you plan to move soon, be careful about paying far above today’s comps.
West Valley micro-markets can shift quickly. The best safeguard is real-time local data, a clear contingency plan, and a calm process when the appraisal arrives. With the right preparation, you can keep your purchase on track and your goals intact.
When you want a calm, concierge plan that fits the Glendale market, our team can help you structure offers, assemble airtight appraisal documentation, and navigate lender timelines with confidence. If you are weighing whether to cover a gap, renegotiate, or walk away, we will help you align the numbers with your larger goals. Start a conversation with the NEWHAUS Real Estate Team.
FAQs
What is an appraisal gap when buying in Glendale?
- It is the difference between your contract price and the appraiser’s value. Lenders base your loan on the lower number, which can create a cash shortfall you must address.
How long does the appraisal process take in Arizona?
- Most appraisals complete in about 5 to 10 business days after your lender orders them, depending on loan type, property complexity, and appraiser availability.
Can I influence or pressure the appraiser to raise value?
- No. Appraisers are independent. You can provide factual information, better comps, and corrections through your lender for a reconsideration, but the appraiser decides based on evidence.
What documents help if I challenge a low appraisal?
- Provide recent and truly comparable closed sales, proof of accurate square footage, permits and receipts for upgrades, HOA information, and clear photos that show condition.
How often do lenders allow a second appraisal?
- It varies by lender policy and the case facts. Some lenders may order a desk review or second appraisal, but it is not guaranteed and may require additional time and cost.
How do FHA and VA appraisals differ from conventional?
- FHA and VA include minimum property standards. They may require repairs and can flag condition issues that affect value and timing. Conventional focuses on market value and loan-to-value.
If I cover the appraisal gap, does my payment change?
- Your loan amount is based on the appraised value, so your loan may be smaller if you add more cash. Your monthly payment may change accordingly. Ask your lender for updated figures.
Is the tax assessed value the same as an appraisal?
- No. The tax assessment uses a different process and timeline. For local information, see the Maricopa County Assessor’s resources.
Resources cited in this article:
- CFPB consumer guide on low appraisals: What happens if the appraised value is lower than the sale price
- Freddie Mac appraisal reconsideration of value FAQs
- HUD Single Family Housing Policy Handbook (FHA)
- VA Home Loans, appraiser information
- Arizona Department of Real Estate, consumer resources
- Maricopa County Assessor, valuation and assessment resources
For direct access to those resources, consider these official pages:
- CFPB on low appraisals: https://www.consumerfinance.gov/ask-cfpb/what-happens-if-the-appraised-value-is-lower-than-the-sale-price-en-795/
- Freddie Mac ROV FAQs: https://sf.freddiemac.com/tools-learning/faq/appraisal-reconsideration-of-value-faqs
- HUD FHA Handbook: https://www.hud.gov/program_offices/housing/sfh/handbook_4000-1
- VA Home Loans appraiser page: https://www.benefits.va.gov/homeloans/appraiser.asp
- ADRE consumers: https://azre.gov/consumers
- Maricopa County Assessor: https://mcassessor.maricopa.gov/
