Property Valuation
An appraisal contingency in a Utah purchase contract protects the buyer by:
AGuaranteeing the home will appraise at or above the purchase price
BAllowing the buyer to cancel or renegotiate if the property appraises below the purchase price✓ Correct
CRequiring the seller to lower the price to the appraised value
DEliminating the need for a formal appraisal
Explanation
An appraisal contingency allows the buyer to cancel the contract (or renegotiate) if the property appraises below the purchase price. Without this contingency, the buyer may be obligated to make up any difference between the appraised value and purchase price out-of-pocket.
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