What is the Mystery Behind the Home Appraisal?
A professional certified home inspector calculates the fair market value of your home. This must be done before you mortgage a home for either purchase or refinancing. This evaluation must be done in accordance to state law, which sets the standard of the fair market value of a home. It dictates that the sale of similar property within a certain radius will be the main determining factor in the appraisal.
How do I find a home appraiser? In the case of a home purchase the mortgage company generally prefers to use their own appraiser although, you will have to pay for it in most cases. When you refinance your home through a mortgage broker, they will typically have some recommendations for your or allow your to use your own appraiser. If you are allowed any input into who is hired to appraise your home, make sure they have a reputation for being quick and honest. A slow closing is often the result of a slow appraiser.
Exactly what information does the appraiser look for? In the appraisal report, you will find the description of the neighborhood and proposed project area and a description of the interior and exterior of the home. They will sketch the floor plan of the home and take photographs of the homes exterior. They will research closing prices of surrounding homes that are similar to yours. They will also check for title information, zoning, and present use of the home and a five history of the homes sales (if there are any.)
What improvements can I make to my home to raise the appraisal? You need to repair any unsightly damages in the home. Water damage on the ceiling, unkempt yards, peeling paint, and other obvious defects will make the appraiser automatically assume the home has been unkempt and lower the appraisal price.
What if I disagree with the home appraisal? If your home is appraised for $150,000 and your neighbors similar houses (in the same shape) sold for $200,000. You will want to give this information to the bank and ask for a new appraisal. You should not have to pay for the second appraisal, if they agree to it.
