SCR310 can handle this issue of the PRICE exceeding the APPRAISED VALUE in several ways.

SCR310 has a checkbox to include or not include an Appraisal Contingency. Hotline has heard reports of the Parties not agreeing to use the Appraisal Contingency. Obviously if used, the Appraisal Contingency can handle this situation in the stated manner.

SCR310 has a DUE DILIGENCE section that can be used "in lieu of" the Financing Contingency and/or the Appraisal Contingency or "in conjunction with" the Financing Contingency and/or the Appraisal Contingency.

Sellers often enjoy DUE DILIGENCE because the buyer must timely/properly terminate and pay the agreed upon amount of cash to terminate. Sellers get cash. Sellers get lukewarm buyers out of the way in a timely manner.

Sellers can use DUE DILIGENCE in lieu of both the financing contingency and the appraisal contingency.

SCR310 has a Financing Contingency that can be used with or without the appraisal contingency and with/without due diligence.

SCR310 Financing Contingency even when used without the Appraisal Contingency can still have an impact on the transaction when the Agreed Purchase Price exceeds the appraisal:

7. FINANCE: Buyer’s obligation under this Contract __ is __ is not contingent upon obtaining financing of __ a 30 year or __ 15 year or __ other purchase money loan at reasonable prevailing market terms with loan(s) equal in amounts to a maximum __ % of the Purchase Price or Appraised Value whichever is lower. ("Financing Contingency"). Financing Contingency expires at Closing ("Financing Period").

Posted by: Byron King on 5/13/21 (This information is only accurate as of 5/13/21. You must contact SCR for updates and changes to this information after 5/13/21 as laws and regulations may change over time. SCR 803-772-5206 or email info at screaltors.org or email byron at screaltors.og)