Q : The bank sent a commitment letter, however afterwords realized the appraisal is less than the sales price. Can they back out.
A : I am sure that the ‘commitment letter’ stated that it was subject to an appraisal – now, based on that & the fact that the house did not appraise for VALUE (based on what YOU wanted – not market value) , make even you a ‘bit’ cautious ?? So, if you still want to buy the house, it will be up to YOU to come up with more money (to make up the difference) or get the seller to agree to adjust the price. If you think the bank should honor the letter, I suggest that YOU read it over – the bank is not backing out. It is plain & simple – the property is just not worth that much in this market Today – SORRY!