Appraisal myths debunked
Legally, an appraiser has to be state certified to write legitimate real estate appraisals for federally-supported transactions. The law gives you the right to receive a copy of your finished appraisal report from your lender after it has been provided. Contact A. M. Appraisals if you have any questions about the appraisal process.
Myth: The value that is assessed by the appraiser is required to be the same as the market value.
Fact: This is not often the case; most states do support the idea that the assessed value is the same as market value, but not always. Interior remodeling that the assessor is not aware of and a lack of reassessment on nearby houses are perfect examples of why there might be a differential in price.
Myth: Depending on if the appraisal is done for the buyer or the seller, the cost of the property will vary.
Fact: There is no real interest on the part of the appraiser in the result of the appraisal report, therefore he will complete his work with impartiality and independence, despite for whom the appraisal is ordered.
Myth: Market value should equal replacement cost.
Fact: The way market value is arrived at is based on what a home buyer would be willing to pay a willing seller for a house without being under pressure from any outside group to buy or sell. If the house were reconstructed, the dollar amount required to do so would make up the replacement cost.
Myth: Specific formulae, like the price per square foot of the property, are what appraisers use to ascertain the cost of a property.
Fact: There are many numerous methods that an appraiser will use to make a full investigation of every factor pertaining to the property, such as the size, location, condition, how close it is to certain facilities and the opinion of value of recently sold comparable properties.
Myth: When the economy is robust and the sales prices of properties are reported to be rising by a certain percentage, the other homes in the area can be expected to rise based on that same percentage.
Fact: All appreciation of price is on a case-by-case basis, found by data on relevant conditions and the data of comparable homes. This is true in fair economic times as well as poor.
Have other questions about appraisers, appraising or real estate in Lexington County or West Columbia, SC?Contact our professional staff
Myth: Just looking at what the property looks like on its exterior gives a good idea of its cost.
Fact: House worth is concluded by a multitude of factors, including - but not limited to - area, condition, improvements, amenities, and market trends. An exterior inspection definitely can't provide all of the data required.
Myth: Since you're the one paying for the appraisal report when applying for your loan to purchase or refinance your house, you own the ordered appraisal.
Fact: Unless a lending agency releases its interest in the report, it is legally owned by the lending agency that ordered the appraisal. Consumers must be supplied with a copy of the appraisal report upon written request because of the Equal Credit Opportunity Act.
Myth: It doesn't mean anything to consumers what's in the appraisal report so long as it meets the necessities of their lender.
Fact: It is very important for consumers to peruse a copy of their report so that they can verify the accuracy of the document, in case it's required to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. There is a great deal of information contained in an appraisal that could be useful to the home buyer in the future, such as the legal and physical description of the property, square footage measurements, list of comparable properties in the neighborhood, neighborhood description and a narrative of current real-estate activity and/or market trends in the proximity.
Myth: Appraisals are ordered only to assess building values in property sales involving mortgage-lending transactions.
Fact: Based upon their qualifications and designations, appraisers can and often do perform a series of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: A home inspection serves the same purpose as an appraisal.
Fact: A home inspection serves a completely different purpose than an appraisal report. The purpose of an appraisal is to arrive at an opinion of fair market value during the appraisal process and the production of the appraisal report. House inspectors will compose a report that will show the condition of the house and its major components and possible damage.
|These articles are property of New York Times and protected by copyright.|
Got a Question?
Do you have a question? We can help. Simply fill out the form below and we'll contact you with the answer, with no obligation to you. We guarantee your privacy.