What You Should Know About Home Appraisals
You found the perfect home you have been searching for for sometime now. The next step if you haven’t already is to find a lender. A lender will need to have the home appraised as one of the factors for how much money they will lend you. This gives them piece of mind. But it should also give you a good feeling knowing the actual value of the home.
What is a Home Appraisal?
An appraisal is not an inspection. It is probably a good idea to have one of those as well. The home may look great on the surface, but you never can be to careful.
No, an appraiser does not take the time to really determine if the home has any damage or flaws that need to be addressed. He may however, make note of safety code violations that would deny the loan. The appraiser evaluates what the home assets are as a whole to get an estimate of what it is actually worth. The value he places on the home can have several factors that will vary based on location. For example if the home has storage for a boat five hundred miles from any body of water. He may not count this as an asset. The style of the home in relation to other local homes as well as customization to the home may be factors. customization is often a negative factor. The owner may have spent a great deal of money to build a custom porch area. But if the local population doesn’t care for the style in which it was done. The next buyer may simply want to tear it out. That costs the buyer money. This devalues the home.
Who Performs Home Appraisals?
Appraisers are third-party certified or licensed contractors, and the lender usually hires them. They are knowledgeable in real estate and are required to know how to evaluate a property on factors such as neighborhood growth, neighborhood housing trends and market conditions.
Be sure to check the credentials and certification of the appraiser. If you have any questions ask Julie Kyser.
Who Pays For Home Appraisals?
The cost of the appraisal is typically the buyers responsibility at closing. However the buyer can opt to pay up front. This is known as a G.F.E. or good faith estimate. The cost can vary based on the size of the property, location and the end value of the home. Generally an estimate will cost a few hundred dollars.