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January 14, 2020
The Fundamentals of Home Appraisals and Home Appraisers
Home appraisals are something that you always hear from people in the real estate industry, especially when your transactions involve applying for a mortgage loan. In essence, a home appraisal is an important component of a mortgage loan. The same goes if you need refinancing for your property or if you are planning to sell your home to someone that requires a mortgage to purchase it.
A home appraisal is essentially an opinion of the value of your property as assessed by a qualified person for the job. To ensure that you are only getting home appraisal services from an unbiased and qualified person or party, you need to acquire the help of third-party professional home appraisers. If you are refinancing your mortgage, mortgage lenders often require you to complete a home appraisal. A home appraisal also benefits potential home buyers who are planning to purchase a home and want to make sure that they don’t overpay for it.
Mortgage lenders require proper home appraisal services from professional appraisers to guarantee homeowners that they are not overpaying for a property. In case the borrower intends to stop paying for their mortgage, the lender can then decide to do away with the borrower from the home and then sell the home to get back the money. Thus, any property needs to be worth more than the money that the borrower or potential homeowner loans. In short, a home appraisal serves to legally protect the mortgage lender.
There are a good number of factors that affect the appraisal value of your home. These include the present market trends, square footage, the features of the house, condition, parking, exterior condition and landscaping, number of rooms or bathrooms and bedrooms, and whether or not the property is deemed up-to-date. It is the job of the appraiser to do an exterior and interior inspection of the abovementioned factors. They also take note of any deferred maintenance. Such information will be included in the report they will submit to the mortgage lender.
The home appraiser uses a standard report form to report all the details and information they have gathered from the inspection. This report form is often required by the appraisal jurisdiction. The information necessary in these appraisal reports are not that varied between nearby countries.
Usually, the standard report form must include details of the following: a street map, comparable rapes, square footage, building sketch, photographs of each comparable property used, photos of the street, back, and front scene of the home, a plot map, a map showing the location of the comparable properties concerning the subject property, description and photo of each room in the house, and description of intended users of the appraisal report.
The typical cost for a home appraisal report ranges from $250 to $500, and the homeowner often takes the responsibility of paying the home appraisers. Quality home appraisals are vital to any home seller, home buyer, and refinancing homeowner. Again, they are a standard process when you transact in the real estate market, especially if you are taking a mortgage loan. It is a process that anyone should take seriously. You have to know how the process works and what value your property is based upon. If you feel that your home appraiser undervalues your property, you can always talk to them and make your case or get another opinion from another home appraiser.