05 Apr Answering Your Home Appraisal FAQ’s
If you have ever bought a home or switched mortgage providers, you probably needed to get an appraisal done. An appraiser’s job is to evaluate your home and give the bank an independent, professional opinion on the value.
When might I be required to get an appraisal done?
Appraisals are often required by banks and lenders to verify the value when a home is purchased, or if the home owner is seeking secured financing. Appraisals are also done to satisfy the legal proceedings in a divorce or estate settlement. For homeowners simply looking for the estimated market value of their property, a real estate agent’s market evaluation is a more cost-effective way to go.
Who is qualified to do an appraisal on my home?
In most cases, the lender will assign the appraisal to an independent, third-party company who meets their certification requirements. Appraisers work hard to get on a lender’s “approved lists” and are bound to a strict code of ethics. After all, they are protecting the bank from fraud or lending more money than the home’s worth.
What should I expect when an appraiser makes an appointment at my home?
It’s important to remember that an appraisal is much different than a home inspection – a common misconception that many homeowners have. The time the appraiser spends in your home will vary depending on the size of the place. The average time it might take an appraiser to inspect a typical single-family dwelling is about 25 minutes. They will take several pictures, make notes, and verify important details as they go.
How does the appraiser determine the value of my home?
The majority of the time spent on the appraisal happens after the inspection. The appraiser will research on neighbourhood trends, review comparable sales in the area, and evaluate how your home compares to recently sold listings. Various factors such as the number of bedrooms, cosmetic finishes, landscaping, and overall appeal of the dwelling will also affect the final appraised value. Note that appraisers cannot take into account active listings, or use undocumented private sales to support the value.
Can an appraiser complete a report without visiting my home?
Usually, the lender will require a full inspection to verify the marketability of a property. However, desktop and drive-by appraisals are becoming more common. In these cases, the appraiser will use the details from the most recent MLS listing on the home to determine its present value. Drive-by appraisals follow a similar format, but the appraiser is required to take a picture of the home from the street to confirm to the bank that it exists.
Appraisers play an important role in the real estate and mortgage-lending industry. They protect home owners from over-borrowing for their homes, and lenders from securing loans on fraudulent transactions.