Can the appraisal contingency be waived?

Yes, parties may waive the contingency in writing. A written waiver should explicitly state consent to proceed despite appraisal results and must be signed by the party waiving the protection to be enforceable.

What happens if the appraisal is lower than contract price?

The addendum should list options: renegotiate purchase price, buyer pays the difference, obtain second appraisal, or terminate and receive deposit return. Follow the exact timelines and notice procedures in the addendum.

Is electronic signing valid for this addendum?

Electronic signatures are typically valid under ESIGN and UETA where adopted. Ensure all parties consent to electronic records and the platform captures a complete audit trail for enforceability.

Do I need notarization or witnesses for the addendum?

Most appraisal addenda do not require notarization, but local real estate instruments and state rules may impose notarization or witness requirements; check state-specific rules or consult counsel.

Who must sign the appraisal addendum?

All named contracting parties (buyer and seller) should sign. If corporate entities are parties, authorized signatories must sign with titles noted to evidence authority.

How do I amend the addendum after execution?

Amendments require written agreement signed by all parties; ensure replacement language specifies new deadlines, thresholds, and whether previously triggered remedies remain in effect.

Electronic Signature
Templates
Real estate
Real Estate Appraisal Contingency Addendum

Real Estate Appraisal Contingency Addendum

This template is fully customizable. Edit the text, fill out the fields, and send it for signature. Give it a try!

REAL ESTATE APPRAISAL CONTINGENCY ADDENDUM

This Appraisal Contingency Addendum is attached to and made a part of the Purchase Agreement dated (the "Agreement") between Buyer: and Seller: concerning the Property at:

Property Identification Legal Description

Purchase Terms

Purchase Price: $ Earnest Money: $

Appraisal Contingency

1. Appraisal Requirement. Buyer’s obligation to complete the transaction is contingent upon an appraisal of the Property performed by a licensed appraiser showing an appraised value that is not less than:

a) the Purchase Price; or b) $; or c) within of the Purchase Price.

2. Appraisal Period. Buyer shall obtain and deliver to Seller a copy of the appraisal report within days after Effective Date of the Agreement (the "Appraisal Period").

3. Who Orders and Pays. The appraisal shall be ordered by: Lender Buyer Seller

4. Appraisal Shortfall Procedures. If the appraisal value is less than the required appraisal value (an "Appraisal Shortfall"), Buyer shall have the rights set forth below. Seller shall be notified in writing of the Appraisal Shortfall within days after Buyer receives the appraisal.

Select remedies available to Buyer (check all applicable):

Buyer may terminate the Agreement and receive return of Earnest Money. Seller may elect to reduce the Purchase Price to the appraised value within days of Seller's receipt of notice.

Buyer may elect to proceed with the transaction by increasing Buyer’s cash to close or financing an amount sufficient to cover the shortfall up to $ (the "Buyer Additional Funds").

5. Seller Response. If Seller timely elects to reduce the Purchase Price as provided above, the Agreement shall be amended in writing to reflect the reduced Purchase Price. If Seller timely so elects and Buyer does not accept such amendment within days, Buyer may terminate the Agreement and receive return of Earnest Money.

6. Appraisal Review and Delivery. Buyer shall deliver the appraisal report to Seller and Seller shall have the right to review the appraisal. The appraisal report shall be deemed delivered when sent to the address for notice set forth in the Agreement or via other permitted notice methods under the Agreement.

7. Waiver. Buyer may waive this Appraisal Contingency in writing by delivering written notice of waiver to Seller within the Appraisal Period. If Buyer waives the contingency, Buyer shall proceed to closing despite any Appraisal Shortfall and shall be responsible for any resulting difference between the appraised value and the Purchase Price.

Buyer hereby elects to waive the Appraisal Contingency (if checked, Buyer must deliver written waiver).

Costs, Deposit and Release

8. Payment of Appraisal and Related Costs. Appraisal fees and any supplemental appraisal costs shall be paid by: Buyer Seller Lender

9. Release of Earnest Money. If Buyer terminates the Agreement pursuant to this Addendum, the Earnest Money shall be released to Buyer in accordance with the Agreement. If Buyer proceeds under a different remedy, the Earnest Money shall remain subject to the Agreement's terms.

Miscellaneous

10. Notices. All notices required or permitted under this Addendum shall be delivered in accordance with the notice provisions in the Agreement.

11. Survival. This Appraisal Contingency Addendum survives termination of the Agreement only to the extent necessary to effectuate return of Earnest Money or other remedies expressly reserved by this Addendum.

12. Entire Agreement; Governing Law. This Addendum, together with the Agreement, contains the entire understanding of the parties with respect to the appraisal contingency and supersedes any prior oral or written statements. This Addendum is governed by the laws of the state identified in the Agreement.

Certifications

By signing below, the parties certify that they have read and understand this Appraisal Contingency Addendum and agree that it modifies the Agreement only as expressly set forth herein. All other terms of the Agreement remain in full force and effect unless otherwise modified in writing.

Buyer (Print Name):

By:

Date:

Seller (Print Name):

By:

Date:

What the Real Estate Appraisal Contingency Addendum Is

The Real Estate Appraisal Contingency Addendum is a contract attachment that makes the buyer's obligations conditional on an appraisal that meets an agreed value or threshold. It specifies appraisal ordering, timelines, acceptable appraisal results, options if the appraisal is low, and any buyer or seller remedies. The addendum protects buyers from overpaying and gives lenders assurance that collateral value was verified; it also sets clear operational steps and deadline-driven responsibilities for agents, lenders, and escrow officers.

Why this Addendum Matters in a Purchase

An appraisal contingency limits buyer exposure if the appraised value is below contract price, preserves financing options tied to lender valuation, and documents timelines and actions needed to resolve value shortfalls without ambiguity for all parties.

Who Typically Uses the Appraisal Contingency Addendum

Common participants include buyers, sellers, listing and buyer agents, mortgage lenders, title or escrow companies, and occasionally attorneys who review remedy language.

Buyers and buyer agents who want protection if appraisal is below purchase price and time to renegotiate or terminate.
Lenders and mortgage officers who rely on appraisal outcomes to satisfy loan-to-value underwriting requirements.
Title/escrow officers and closing agents responsible for tracking deadlines and holding deposits in escrow per contingency terms.

The addendum aligns expectations among these roles and creates a documented process for ordering appraisals, sharing results, and applying contract remedies within stated timeframes.

Essential Parts of a Professional Appraisal Contingency Addendum

A complete addendum combines clear thresholds, timing, appraisal selection rules, and remedies so parties can act quickly and reduce closing risk.

Appraisal Threshold

Specify the minimum acceptable appraised value or the gap the buyer will cover; use precise dollar amounts or percentage of purchase price to avoid ambiguity.

Ordering & Payment

State who orders and pays for the appraisal, including whether the lender or buyer arranges the appraisal and whether payment is refundable if the sale terminates.

Appraiser Selection

Define acceptable appraisers (licensed, certified, or independent), any lender panel restrictions, and procedures for replacing an appraiser if a conflict arises.

Delivery & Review

Set the deadline for delivery of the appraisal report, how it is delivered (electronic or paper), and the timeframe for buyer and lender review.

Remedies and Options

List the buyer’s options on low appraisal: renegotiate price, pay the difference, obtain a second appraisal, or terminate and receive deposit return per contract terms.

Waiver and Acceptance

Describe how the buyer may waive the contingency or accept the appraisal in writing, including any required signatures or escrow instructions to finalize acceptance.

Step-by-Step: How to Complete and Deliver the Addendum

Follow these steps in order to ensure deadlines are tracked and obligations are clear for all parties.

01

Execute Contract: Buyer and seller sign the purchase agreement with addendum attached.
02

Order Appraisal: Lender or buyer orders appraisal per addendum rules.
03

Receive Appraisal: Appraiser sends report to lender and buyer within deadline.
04

Apply Remedies: Parties renegotiate, pay gap, or terminate per addendum terms.

How to Configure an Online Workflow for the Addendum

Set up template fields, signer order, and notifications to automate the appraisal contingency process.

Field	Configuration
Signature Fields	Place signer-specific signature and date fields for each party.
Conditional Logic	Show renegotiation fields only if appraisal value is below threshold.
Authentication	Require email verification or SMS code for key signers.
Notifications	Configure reminders for appraisal delivery and contingency deadlines.

Where to Send or File the Completed Addendum

Distribute signed copies to the lender, title/escrow officer, listing and buyer agents, and retain a copy for each party.

Lender Delivery: Send final signed addendum to lender for loan underwriting files.
Escrow/Title: Provide addendum to escrow or title for closing instructions and deposit handling.
Buyer and Seller: Each party keeps a fully executed copy for their records.
Listing/Buyer Agent: Agents maintain copies in transaction management systems.

Technical Considerations for eSigning and eSubmission

Choose a platform that supports PDF and DOCX, audit trails, and configurable authentication for signer verification.

File Formats: PDF and Word DOCX supported
Authentication: Email, SMS, or advanced methods
Integrations: Works with CRM and escrow systems

Ensure the chosen provider supports ESIGN and UETA compliance, retains complete audit trails, and integrates with your lender or title workflows.

Common Deadlines and Timeframes to Track

Timely performance is central; document each date relative to the contract effective date to avoid disputes.

Appraisal Order Window:

Typically within 7–14 days of contract effective date.

Appraisal Delivery Deadline:

Set as a fixed MM/DD/YYYY date or X days after order.

Buyer Response Period:

Buyer usually has 3–5 business days to act on low appraisal.

Buyer Termination Deadline:

Contract may allow termination by a set date if unresolved.

Closing Date:

May be extended by mutual consent if contingency triggers delay.

Key Milestones from Contract to Closing

Track these sequential milestones to ensure the contingency is honored and actions are timely.

01

Contract Effective

Start point for all contingency countdowns and deadlines.

02

Appraisal Ordered

Appraiser engagement and scheduling occurs within ordered timeframe.

03

Appraisal Returned

Report delivered to lender and buyer for evaluation.

04

Resolution or Termination

Parties execute remedies, renegotiation, or terminate per addendum.

Common Preparation Errors to Avoid

Failing to specify whether the appraisal is ordered by buyer or lender, causing duplicate orders and unnecessary fees.
Using vague language for the appraisal threshold, leading to disagreements about acceptable valuation shortfalls.
Missing to attach the executed appraisal report as a formal notice of value, which can void remedy timelines.
Neglecting to configure conditional fields in digital workflows so required follow-up steps are hidden or omitted.

Risks and Consequences of an Incorrect or Missing Addendum

Deposit Forfeiture: Buyer risk of losing earnest money

Financing Failure: Loan denial or delayed funding

Title Problems: Escrow complications or closing delays

Contract Breach: Potential litigation or arbitration

Waiver Invalidity: Improper waivers may be unenforceable

Missed Deadline: Loss of contractual remedies

eSignature Pricing and Feature Snapshot for Appraisal Addenda

Compare basic pricing and core feature availability relevant to signing and storing appraisal contingency addenda; signNow is listed first per vendor comparison guidance.

	signNow	DocuSign	Adobe Sign	PandaDoc	HelloSign
Starting Price	$8/user/mo	$15/user/mo	$14/user/mo	$19/user/mo	$15/user/mo
Free Trial	7-day free trial	Varies by plan	Varies by plan	Varies by plan	Varies by plan
Bulk Send	Yes	Yes	Yes	Yes	No
Audit Trail	Yes	Yes	Yes	Yes	Yes
HIPAA Compliant	Yes	Yes	Yes	No	No
Envelope Cap	No cap	100 envelopes/user/year	Varies by plan	Varies by plan	Varies by plan

Real-World Examples of Using the Addendum

Practical examples illustrate how parties use appraisal contingencies to manage valuation risk and closing timelines.

Martin Properties

Tim Martin used the addendum to require an independent valuation before closing

The appraisal returned below purchase price by 6%
The parties renegotiated the purchase price downward, the buyer preserved earnest money, and closing proceeded with lender approval and revised terms.

Optica Ventures

A buyer's agent for Optica Ventures required explicit appraisal deadlines and appraiser selection rules

The lender accepted the selected appraiser panel
When value matched expectations, underwriting completed faster and the transaction closed on schedule with clear audit documentation.

Best Practices for Clear, Enforceable Addenda

Adopt these practical measures to reduce disputes and speed closing.

Be Specific About Value

State precise dollar thresholds or percentages rather than vague phrases; specificity prevents interpretive disputes and supports lender underwriting consistency.

Document Deadlines Clearly

Use calendar dates or a fixed number of days from a clear trigger like the effective date; ambiguous timing is a common source of conflict.

Align with Lender Requirements

Confirm appraisal provider rules and report formats with the lender up front to prevent rejection or reordering that delays closing.

Preserve the Appraisal Report

Keep a certified copy of the appraisal in escrow or transaction files for the retention period required by tax, lending, or corporate policy.

Security and Compliance Considerations for eSigned Addenda

Encryption: TLS 1.2/1.3 and AES-256 at rest

Audit Trail: Timestamps, IP, and event logs

Regulatory Compliance: ESIGN and UETA adherence

HIPAA Support: HIPAA available with BAA

21 CFR Part 11: Support for regulated workflows

Certifications: SOC 2 Type II and ISO 27001

Who Signs and Who Decides

Listing Agent — Broker

The listing agent often coordinates seller signature, presents addendum language for approval, and ensures the executed addendum is delivered to escrow and the buyer’s agent; broker policies may require supervision or review before signature.

Mortgage Officer — Lender

The lender or mortgage officer enforces appraisal provider rules and confirms that the appraisal satisfies underwriting requirements; they may require specific language about appraiser selection or report delivery to accept valuation for funding.

Frequently Asked Questions About the Appraisal Contingency Addendum

Answers to common questions about execution, eSigning, remedies, notarization, and post-appraisal steps.

Need help? Contact support

Can the appraisal contingency be waived?
Yes, parties may waive the contingency in writing. A written waiver should explicitly state consent to proceed despite appraisal results and must be signed by the party waiving the protection to be enforceable.
What happens if the appraisal is lower than contract price?
The addendum should list options: renegotiate purchase price, buyer pays the difference, obtain second appraisal, or terminate and receive deposit return. Follow the exact timelines and notice procedures in the addendum.
Is electronic signing valid for this addendum?
Electronic signatures are typically valid under ESIGN and UETA where adopted. Ensure all parties consent to electronic records and the platform captures a complete audit trail for enforceability.
Do I need notarization or witnesses for the addendum?
Most appraisal addenda do not require notarization, but local real estate instruments and state rules may impose notarization or witness requirements; check state-specific rules or consult counsel.
Who must sign the appraisal addendum?
All named contracting parties (buyer and seller) should sign. If corporate entities are parties, authorized signatories must sign with titles noted to evidence authority.
How do I amend the addendum after execution?
Amendments require written agreement signed by all parties; ensure replacement language specifies new deadlines, thresholds, and whether previously triggered remedies remain in effect.

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