Just wondering what happens when a house is appraised for less than the sale price. For example, say a house is under contract (accepted offer) for $400000. The buyer plans on a down payment of $125000 so they will only have to finance $275000. The appraisal comes in at $350000, so less than the sales price but more than the loan amount.
Does the bank care about this at all? Would it jeopardize the loan? The buyer and seller are fine with the appraised value versus the sales price.