Should I Include Appraisal Gap Coverage in my Offer?

If you are trying to buy a house in the Dayton, Ohio area maybe you've heard the term Appraisal Guarantee or Appraisal Gap Coverage. I've been a Realtor for 28 years but I'd never heard of it until we hit this hot market in the Kettering, Beavercreek, Bellbrook and surrounding areas.  We often see multiple offers on a single property. Going over asking price has certainly been a popular tactic lately to try to win the property. Problem is it has become so popular it often takes more than that to prevail in a bidding war.

Sometimes you need an even bigger advantage.  One thing the seller gets worried about when the price goes over asking is if the property will appraise or not. If it does not appraise for at least the contract price then everything stops. Either the seller comes down to meet the appraised value, the buyer throws in some extra money or a combination of the two.

Offering Appraisal Gap Coverage might be the answer to put the seller's mind at ease and make your offer get picked. This means that if the property does not appraise for the contract price the buyer will make up the difference with cash! That can be big ask especially if you are already stretched a bit just coming up with the down payment and closing costs. Not everyone can do this.  Not everyone that can do is willing to do it. Just know it is an option and I can explain in more detail the ins and outs of it. Happy to share other best Realtor practices with you as well.