Appraisal myths debunked
Legally, an appraiser has to be state certified to perform substantiated appraisal reports for federally-backed transactions. You also have the right to acquire a copy of the completed appraisal from your lender. Contact Appraisal-One if you have any questions about the appraisal procedure.
Myth: The value that is assessed by the appraiser will be exactly the same as the market value.
Fact: It could be that California, like most states, validates the idea that the assessed value equates to the market value; however, this is not often the case. Interior reconstruction that the assessor is not aware of and a lack of reassessment on nearby properties are exact examples of why the price can vary.
Myth: The buyer or the seller will have an influence in the cost of the home depending upon for whom the appraiser is working.
Fact: There is no vested interest on the part of the appraiser in the result of the appraisal report, therefore he will conduct his work with impartiality and independence, despite for whom the appraisal is conducted.
Myth: Market value will equal replacement cost.
Fact: The way market value is derived is based on what a home buyer would likely pay a willing seller for a home without being under duress from any external party to buy or sell. If the property were reconstructed, the dollar amount needed to do so would make up the replacement cost.
Myth: There are certain methods that appraisers use to find the opinion of value of a house, such as the price per square foot.
Fact: An appraisal is an amalgamation of data concluded from the house's size, location, proximity to undesirable facilities, the condition of the house and the value of recent comparable sales. You can depend on Appraisal-One's appraisers to be honest in assessing this data.
Myth: As homes increase their worth by a certain percentage - in a strong economic state - the homes within the same neighborhood are figured to increase by the same amount.
Fact: Price increase of a certain property has to be determined on an individualized basis, factoring in information on comparable properties and other relevant considerations. It doesn't matter if the economy is doing well or declining.
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Myth: You can often tell what a home is worth simply by looking at the outside.
Fact: Property worth is concluded by a number of variables, including - but not limited to - area, condition, improvements, amenities, and market trends. There's no real way to get all of this data from simply examining the home from the exterior.
Myth: Considering that the consumer is the party who puts up the funding to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal is theirs.
Fact: Unless a lending agency releases its interest in the appraisal report, it is legally owned by the lending agency that ordered the appraisal. Home buyers must be supplied with a copy of the report upon written request because of the Equal Credit Opportunity Act.
Myth: There's no need for consumers to even worry about what the appraisal report contains so long as their lending company is satisfied.
Fact: Only if consumers look through a copy of their report can they ensure its accuracy and possibly need to question the result. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the appraisal report makes an excellent record for future reference, comprised of useful and often-revealing information - including 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: Appraisers are hired only to assess home values in house sales involving mortgage-lending deals.
Fact: Appraisers can have many varied qualifications and designations which allow them to perform a lot of different services including - but definitely not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: You don't need to get an appraisal if you order a home inspection.
Fact: An appraisal does not serve the same purpose as an inspection report. The appraiser forms an opinion of value in the appraisal process and resulting appraisal. A home inspector analyzes the condition of the property and its main components and reports their findings.