Home appraisals, although used in many instances, are designed to determine the true market value of the property in consideration. Market value is how much the property is worth according to what type of property it is, what condition it is in, and other properties similar to it in the immediate area.
The only problem with home appraisals is that they can often differ greatly among different appraisers, the professionals who actually appraise the property. This is because an appraisal is just an opinion, based on market data, as to what the property is worth. So, you may get a higher figure from one appraiser and a lower number from another appraiser.
This can give lenders room to determine the market value for a property. For example, a lender could have his personal appraiser appraise the property for considerably less, based on the market data that the appraiser chooses to use, in order to decrease the loan amount that the lender can provide a home buyer. In turn, if a home owner is selling a home, the appraisal can be determined at a higher value so the owner will get as much for the house as possible. This “opinion” may not always reflect an accurate or true market value.
For this reason, if you are refinancing a home, selling, or buying, it is a good idea to find an appraiser, not related to any of the interested parties, such as buyer, seller or lender, in order to find the true market value of the property. This appraiser will have no tendencies to determine the appraisal in anyone's favor. It is an even better idea to get two or three appraisals if you feel it is really necessary. This is also a great tool to show whoever may have just a ridiculous appraisal that it could not be what they say it is. It can be great proof to strengthen your case for the property.
It is really important to have a true market value of the property so the owner can get what it is worth, the buyer can get it at the market price, and also get the proper amount loaned to him or her. When the property is appraised at true market value, there is room for some negotiation and everyone knows they are getting a fair price.
So how do you find an appraiser? Well, you could use the seller's, the lender's, or the broker's appraisal, but like I mentioned earlier, I would find an independent appraiser. You can look in the yellow pages under appraisal, search the Internet, ask trusted people such as family, friends and co-workers, who may have a fair person in mind. This is really just a way to protect you from getting a bad deal.
You should call a few appraisers to get quotes on how much is charged for an appraisal. Find a few that are within in your price range and make appointments for a walk through, or meeting to discuss the property. The appraisers should explain the data they are going to use to determine the value of the home. They should evaluate the number of bedrooms, bathrooms, condition, upgrades, whether there is a pool or spa, and of course the land it is on itself. They should also check at least three similar properties that have recently sold in that immediate area within the last three months, that are comparable to the property in consideration.
A true market value appraisal can save you money and get the loan you deserve, so be sure to do it right! It is worth it, especially if you feel the people you are working with wish to work in their own favor. There are many honest people out there, but there are also many who will do anything to get some more money in their pocket, especially in the real estate market. There have been know to be dishonest lenders and appraisers, after all, with an appraisal being simply an opinion, get it confirmed! This can only work in your favor.
John R Blakefield is a mortgage and real estate specialist. For more information, articles, news, tools and valuable resources on home mortgages or investment loans, refinancing, debt solutions, visit this site: http://www.scourtheweb.com/mortgage.
