Appraisal myths & facts
Legally, an appraiser needs to be state certified to create substantiated real estate appraisals for federally-related sales. The law gives you the right to get a copy of your finished report from your lending agency after it has been produced. Contact us if you have any concerns about the appraisal process.
Myth: Market value will always be similar to the assessed value of the property.
Fact: This usually isn't true; most states do support the suggestion that the assessed value is the same as market value, but not always. Interior remodeling that the assessor has not investigated and a lack of reassessment on nearby homes are prime examples of why the price can vary.
Myth: The buyer or the seller sometimes may have impact in the value of the home depending upon for whom the appraiser is working.
Fact: The price of the house does not affect the payment of the appraiser; because of this, the appraiser has no preconceived interest in the opinion of value of the home. What this means is he will complete his services with impartiality and independence regardless for whom the appraisal is created.
Myth: Any time market value is established, it should be the same as the replacement cost of the home.
Fact: Without any pressure from any different parties to purchase or sell, market value is what a willing buyer would pay an interested seller for a specific house. The replacement cost is the dollar amount needed to rebuild a house in-kind.
Myth: Certain formulae, like the price per square foot, are the methods appraisers use to ascertain the price of a home.
Fact: An appraisal report is an amalgamation of information based on the home's size, location, proximity to some facilities, the condition of the house and the cost of recent comparable sales. You can count on Sutherland Appraisal Services, Inc.'s appraisers to be forthright in assessing this data.
Myth: In a strong economy - when the sales prices of homes in a given area are reported to be increasing by a particular percentage - the costs of individual homes in the area can be expected to rise by that same percentage.
Fact: Any price at which an appraiser concludes concerning a certain property is always personalized, based on certain factors derived from the information of comparable homes and other considerations within the house itself. This is true in good economic times as well as bad.
Have other questions about appraisers, appraising or real estate in Dupage County or Naperville, IL?Contact Sutherland Appraisal Services, Inc.
Myth: The home's outside is determinate of the actual worth of the house; there is no need to do an interior inspection.
Fact: There are a multitude of different variables that conclude property value; these factors include area, condition, improvements, amenities, and market trends. An outside-only inspection obviously can't provide all of the data necessary.
Myth: Since you're the one funding for the appraisal report when applying for your loan to buy or refinance your home, you own the provided appraisal report.
Fact: Legally, the document is owned by the lending agency unless the lender relinquishes their interest in the document. Consumers must be provided with a version of the report upon written request as per the Equal Credit Opportunity Act.
Myth: Consumers need not care about what is in their appraisal so long as it meets the necessities of their lending institution.
Fact: Only if consumers look over a copy of their report can they double-check its accuracy and possibly need to question the result. Remember, this is probably the most expensive and important investment a consumer will ever make. There is a wealth of information contained in an report that should be useful to the home buyer in the future, such as 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 region.
Myth: Appraisers are hired only to estimate real estate property values in house sales involving mortgage-lending transactions.
Fact: Ordering an appraisal can fulfill a variety of needs 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: You shouldn't need to get an appraisal if you order a home inspection.
Fact: A home inspection has a completely different purpose than an appraisal report. The job of the appraiser is to arrive at an opinion of value in the appraisal process and through writing the report. A home inspector determines the condition of the building and its main components and reports their findings.