What Is a Home Appraisal Contingency in New Hampshire?

🏡 What Is a Home Appraisal Contingency in New Hampshire?

When buying a home in Plymouth, Campton, Thornton, Rumney, Ashland, or anywhere in Central NH, it’s extremely common for buyers using financing to include a home appraisal contingency in their offer.

This clause protects buyers from overpaying if the home doesn’t appraise for the agreed-upon price — a situation that comes up frequently in competitive or low-inventory New Hampshire markets.

Here’s how appraisal contingencies work and why they are so important.

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What Is an Appraisal Contingency?

A home appraisal contingency is a clause in the Purchase & Sale Agreement stating that:

The home must appraise at or above the agreed purchase price

OR the buyer has the right to renegotiate

OR the buyer may walk away with their earnest money refunded

It ensures buyers aren’t forced to pay more than what the lender determines the home is worth.

This is especially important in Central NH, where rising prices and limited inventory can cause contract prices to outpace appraised values.

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Why Appraisal Contingencies Matter in New Hampshire

In markets like Plymouth, Campton, Thornton, Rumney, and surrounding towns, appraisal contingencies help protect buyers from:

✔ Overpaying in bidding wars

✔ Low appraisal values in a fast-moving market

✔ Loan denial due to appraisal gaps

✔ Unexpected out-of-pocket costs

✔ Falling short of lender requirements

Without an appraisal contingency, buyers could be forced to bring thousands of extra dollars to closing to cover the difference.

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What Happens If a Home Appraises Low?

If the appraisal comes in below the purchase price, several options are possible:

✔ Price Reduction:

The seller lowers the price to match the appraised value.

✔ Seller / Buyer Split:

Both parties meet in the middle to close the gap.

✔ Buyer Covers the Gap:

The buyer brings extra cash to cover the difference.

✔ Deal Canceled:

The buyer walks away with their earnest money refunded (if the contingency is active).

In New Hampshire, negotiation is common when low appraisals occur — especially on older homes or rural properties.

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Does Waiving an Appraisal Contingency Make an Offer Stronger?

Yes — but it increases risk.

Buyers sometimes waive this contingency to compete in multiple-offer situations.

This is more common on:

Homes in desirable areas like Plymouth & Holderness

New construction

Homes priced below market value

However, waiving the appraisal contingency means the buyer must cover any appraisal gap out of pocket.

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Q&A

Q: Can cash buyers skip the appraisal contingency?

A: Yes — cash buyers often waive it since no lender is involved, but many still choose to get an appraisal for peace of mind.

Q: Do VA or FHA loans have stricter appraisal rules?

A: Yes. FHA and VA appraisals have strict minimum property standards and may require repairs before closing.

Keywords

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Jim Johnson — Real Estate Agent

58 NH Route 25A

Wentworth, NH 03282

P: (857) 249-7392

W: www.JimJohnsonRealEstateAgent.com

Licensed New Hampshire REALTOR® with Three Hills Real Estate Services

Broker Email: info@ThreeHillsRES.com

Broker Website: www.ThreeHillsRES.com