Appraisal myths debunked
Legally, an appraiser has to be state certified to write legitimate real estate appraisals for federally-related purchase. Also by law, you are entitled to request a copy of the finished appraisal report from your lender. Contact our professional staff if you have any questions about the appraisal process.
Myth: Assessed value should always be the same as to market value.
Fact: This is not often the case; most states do support the suggestion that the assessed value is the same as market value, but not always. Examples include when interior reconstruction has happened and the assessor does not know about the improvements, or when properties in the vicinity have not been reassessed for an prolonged time.
Myth: Depending on whether the appraisal is written for the buyer or the seller, the appraised value of the property will vary.
Fact: There is no personal interest on the part of the appraiser in the outcome of the appraisal report, therefore he will complete his work with impartiality and independence, despite for whom the appraisal is created.
Myth: The replacement cost of the property should be is on par with the market value.
Fact: Market value is found by what a willing buyer would likely pay a willing seller for a specific home, with neither being under duress to buy or sell. If the property were rebuilt, the dollar amount required to do so would make up the replacement cost.
Myth: Appraisers use a formula, like a specific price per square foot, to come to the cost of a home.
Fact: An appraisal report is a collection of data based on the house's size, location, proximity to specific facilities, the condition of the house and the price of recent comparable sales. You can depend on Ralph Real Estate Appraisal, Inc.'s staff to be forthright in assessing this data.
Myth: In a strong economy - when the sales prices of properties in a given region are found to be rising by a certain percentage - the costs of individual houses in the proximity can be expected to increase by that same percentage.
Fact: Any value at which an appraiser arrives concerning a certain home is always individualized, based on certain factors derived from the data of comparable houses and other specifications within the home itself. This is true in good economic times as well as poor.
Have other questions about appraisers, appraising or real estate in Shelby County or Cordova, TN?Contact Ralph Real Estate Appraisal, Inc.
Myth: Just examining what the home looks like on its exterior gives an idea of its cost.
Fact: Property worth is concluded by a multitude of variables, including - but not limited to - area, condition, improvements, amenities, and market trends. Obviously, none of these factors can be found simply by looking at the house from the exterior.
Myth: Since the consumer is the person who puts up the capital to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal belongs to them.
Fact: The document is, in fact, legally owned by the lending agency - unless the lender "relinquishes its interest" in the document. However, consumers have to be given a copy of the appraisal upon written request, because of the Equal Credit Opportunity Act.
Myth: It doesn't mean anything to consumers what's in the report so long as it meets the requirements of their lender.
Fact: A home buyer should definitely look through their appraisal report; there will probably be some questions or some worries with the accuracy of the inspection that must be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. An appraisal can double as a record for the future, since it contains an exorbitant amount of information - including, but certainly 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 area.
Myth: There is no reason to hire an appraiser unless you are trying to get an estimate of the worth of a house during a sales transaction involving a lending company.
Fact: Ordering an appraisal can fulfill a variety of necessities depending on the designations and certifications of the appraiser involved; appraisers can provide a multitude of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: An appraisal report is the same as a home inspection.
Fact: An appraisal does not fulfill the same purpose as an inspection report. An appraiser finds an opinion of value in the appraisal process and resulting report. A home inspector analyzes the condition of the house and its main components and reports their findings.