Common myths about appraising

By law, an appraiser is required to be state-licensed to produce appraisals for federally-related transactions. The law entitles you to receive a copy of your completed report from your lender after it has been produced. Contact A. M. Appraisals if you have any questions about the appraisal process.

Myth: Assessed value should always equate to market value.

Fact: This is not often the case; most states do support the concept that the assessed value is the same as market value, but not always. Usually when interior remodeling has been done and the assessor is not aware of the improvement or properties in the neighborhood have not been reassessed for years or more, it may vary wildly.

Myth: The appraised value of a property will change depending upon whether the appraisal is ordered for the buyer or the seller.

Fact: The appraised value of the property does not affect the payment of the appraiser; as a result, the appraiser has no personal interest in the value of the property. This means that he will conduct services with impartiality and independence regardless for whom the appraisal is provided.

Myth: Market value should equal replacement cost.

Fact: Without any pressure from any external parties to buy or sell, market value is what a willing buyer would pay an interested seller for a particular house. The dollar amount demanded to rebuild a home is what forms the replacement cost.

Myth: Specific formulae, like the price per square foot, are what appraisers use to determine the price of a house.

Fact: Appraisers make a comprehensive analysis of all factors pertaining to the value of a house, including its location, condition, size, proximity to facilities and recent worth of comparable properties.

Myth: In a robust economy - when the values of homes in a given neighborhood are reported to be rising by a particular percentage - the values of individual properties in the proximity can be expected to rise by that same percentage.

Fact: Any price at which an appraiser concludes in regards to a specific home is always individualized, based on certain factors derived from the data of comparable properties and other considerations within the property itself. It makes no difference whether the economy is strong or terrible.

Have other questions about appraisers, appraising or real estate in Lexington County or West Columbia, SC?

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Myth: The house's exterior is determinate of the actual worth of the property; it is unnecessary to do an interior inspection.

Fact: There are a multitude of different variables that conclude the value of a home; these factors include area, condition, improvements, amenities, and market trends. There's no possible way to get all of this data from just looking at the home from the exterior.

Myth: Since you're the one funding for the appraisal when applying for the loan to purchase or refinance your house, you own the ordered appraisal.

Fact: Legally, the report is owned by the lending agency unless the lender relinquishes their interest in the document. Because of the Equal Credit Opportunity Act, any consumer requesting a copy of the document must be given it by their lender.

Myth: There's no need for consumers to even care about what the report contains so long as their lending agency is fine with the contents therein.

Fact: A consumer should definitely look through their appraisal; there might be some questions or some worries about the accuracy of the appraisal that must be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the report makes a valuable record for future reference, containing helpful and often-revealing data - including, but not limited to, 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: There is no reason to order an appraisal unless you are trying to get an assessment of the worth of a home during a sales transaction involving a lender.

Fact: Depending upon their qualifications and designations, appraisers can and may provide a multitude of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.

Myth: An appraisal report is the same as a home inspection.

Fact: An appraisal does not fulfill the same purpose as an inspection. The reason behind an appraisal is to conclude upon an opinion of fair market value during the appraisal process and the production of the appraisal report. The task of a home inspector is to find the condition of the house and its major components, then compose a report on these findings.

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