Common myths about appraising
Legally, an appraiser must be state certified to perform substantiated real estate appraisals for federally-backed purchase. The law allows you to acquire a copy of your completed appraisal report from your lender after it has been provided. Contact us if you have any questions about the appraisal procedure.
Myth: Assessed value should always be similar to 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 occurred and the assessor is unaware of the improvements, or when properties in the vicinity have not been reassessed for an prolonged period.
Myth: Depending on whether the appraisal is written for the buyer or the seller, the opinion of value of the property will vary.
Fact: The appraiser has no personal interest in the result of the appraisal report and should render services with independence, objectivity and impartiality - no matter for whom the appraisal is written.
Myth: Market value will be the same as replacement cost.
Fact: Market value is acquired by what a willing buyer would be interested in paying a willing seller for a particular property, with neither being under pressure to buy or sell. If the property were rebuilt, the dollar amount needed to do so would set the replacement cost.
Myth: There are certain ways that real estate appraisers use to show the opinion of value of a home, like the price per square foot.
Fact: An appraisal is a collection of information concluded from the house's size, location, proximity to certain facilities, the condition of the home and the value of recent comparable sales. You can rely on Sutherland Appraisal Services, Inc.'s staff to be professional in assessing this data.
Myth: In a robust economy - when the worth of homes in a given county are reported to be increasing by a certain percentage - the values of individual homes in the proximity can be expected to increase by that same percentage.
Fact: Worth appreciation of a specific home is always determined on an individualized basis, factoring in information on comparable houses and other relevant specifications within the house itself. It doesn't matter if the economy is on the rise or declining.
Have other questions about appraisers, appraising or real estate in Dupage County or Naperville, IL?Contact us
Myth: Just seeing what the property looks like on the outside gives an idea of its worth.
Fact: To conclude an accurate worth beyond all doubt, an appraiser must inspect the home on a variety of factors based on location, condition, improvements, amenities, and market trends. There's no real way to get all of this information from simply inspecting the house from the exterior.
Myth: Because consumers fund appraisal reports when applying for loans to purchase or refinance real estate, they legally own their appraisal report.
Fact: The appraisal is, in fact, legally owned by the lending agency - unless the lender "releases its interest" in the document. However, home buyers must be supplied with a copy of the document upon written request, because of the Equal Credit Opportunity Act.
Myth: There's no reason for consumers to even care about what the appraisal contains so long as their lending agency is satisfied.
Fact: It is a very good idea for consumers to go through a copy of their appraisal report so that they can verify the accuracy of the report, in case they need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the report makes an excellent record for future reference, filled with helpful and often-revealing data - 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: The only reason someone would hire an appraiser is if a property needs its cost estimated in a lender-based sales transaction.
Fact: Hiring an appraiser can fulfill a variety of wants depending on the designations and certifications of the appraiser involved; appraisers can perform a great deal of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: A home inspection serves the same purpose as an appraisal.
Fact: Appraisal reports are completely different than a home inspection report. The reason behind an appraisal report is to arrive at an opinion of fair market value during the appraisal process and the production of the appraisal. The task of a home inspector is to find the condition of the property and its main components, then write a report on their conclusions.