Definition
The difference between a contract price and a lower appraised value, which the buyer must generally cover in cash.
Example
A $520,000 contract appraising at $498,000 created a $22,000 gap the buyer had agreed in advance to cover.
Related terms
Frequently asked questions
What does Appraisal Gap mean in real estate?
The difference between a contract price and a lower appraised value, which the buyer must generally cover in cash.
How is Appraisal Gap used in practice?
A $520,000 contract appraising at $498,000 created a $22,000 gap the buyer had agreed in advance to cover.
This definition is provided for educational purposes. Legal and tax terminology can carry jurisdiction-specific meaning — confirm with a licensed professional before relying on it in a transaction.