Common myths about appraising

It is enforced by the government that an appraiser must be state-licensed to offer appraisals for federally-supported real estate purchases in . You have the ability to receive a copy of the completed report from your lending agency. Contact our professional staff if you have any concerns about the appraisal process.

Myth: Assessed value should always be equal to market value.

Fact: While most states support the concept that assessed value approximates estimated market value, this often is not the case. Examples include when interior reconstruction has happened and the assessor has not seen the improvements, or when houses in the area have not been reassessed for an prolonged period.

Myth: The appraised value of a house will differ depending upon whether the appraisal is ordered for the buyer or the seller.

Fact: There is no real interest on the part of the appraiser in the result of the appraisal, therefore he will conduct his work with impartiality and independence, regardless for whom the appraisal is created.

Myth: The replacement cost of the house should be is on par with the market value.

Fact: Without any influence from any different parties to buy or sell, market value is what a willing buyer would pay a willing seller for a particular house. If the house were reconstructed, the dollar amount necessary to do so would set the replacement cost.

Myth: Specific methods, such as the price per square foot, are the methods appraisers use to arrive at the worth of a home.

Fact: Appraisers make a full analysis of all factors pertaining to the cost of a house, including its location, condition, size, proximity to facilities and recent sale prices of comparable properties.

Myth: When the economy is robust and the sales prices of properties are reported to be rising by a certain percentage, the other houses in the vicinity can be expected to rise based on that same percentage.

Fact: Worth increase of a specific house must be concluded on an individualized basis, factoring in data on comparable homes and other relevant elements. It doesn't matter if the economy is doing well or declining.

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Myth: You can often see what a home is worth simply by looking at the outside.

Fact: To find an accurate value beyond all doubt, an appraiser must examine the home on a variety of factors based on location, condition, improvements, amenities, and current market trends. There's no real way to get all of this data from just examining the house from the outside.

Myth: Since you're the one paying for the appraisal when applying for the loan to purchase or refinance your home, you own the provided appraisal.

Fact: Unless a lending agency releases its interest in the document, it is legally owned by the lending agency that purchased the appraisal. Home buyers must be provided with a copy of the appraisal report through request due to the Equal Credit Opportunity Act.

Myth: It doesn't concern consumers what's in the appraisal report so long as it meets the necessities of their lending agency.

Fact: A consumer should definitely inspect their document; there could be some questions or some concerns about the accuracy of the appraisal report that need to be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. There is a wealth of information stored in an appraisal report that could be useful to the consumer 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 assess building values in home sales involving mortgage-lending deals.

Fact: Ordering an appraisal can fulfill a variety of wants depending on the designations and certifications of the appraiser involved; appraisers can provide a variety of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.

Myth: You don't have to get an appraisal if you get a home inspection.

Fact: A home inspection report serves a completely different purpose than an appraisal report. The appraiser decides upon an opinion of value in the appraisal process and resulting appraisal report. House inspectors will write a report that will explain the condition of the home and its major components and possible damage.