Yes. You can sell a home for whatever you and the buyer agree upon. The lender, however, will consider the lesser of the purchase price and appraised value when calculating the loan-to-value.
This means that, if a property's appraised value is lower than it's purchase price, the buyer will have to come out of pocket with the difference between their loan amount and the sales price.
Let's consider the following example. A home is contracted for sale at a purchase price of $350,000. The home appraises for $300,000, and the borrower wants to put 10% down. The lender will consider the purchase price as $300,000, offer a loan of $270,000, and require a down payment of $30,000. This means that the borrower would have to come up with, not only the settlement costs and the $30,000 down payment, but an additional $50,000 to meet the sales price.
