Appraisal myths & facts

It is mandated by legal agencies that a real estate appraiser needs to be state-licensed to perform appraisal reports for federally-related real estate transactions in . The law allows you to get 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 generally will be the same as to market value.

Fact: It could be that , like most states, validates the common myth that the assessed value is the same as the market value; however, this certainly varies based on state-to-state. Interior reconstruction that the assessor has not investigated and a dearth of reassessment on nearby homes are prime examples of why this occurs.

Myth: The buyer or the seller will have impact in the value of the house depending upon for whom the appraiser is working.

Fact: The price of the property does not affect the salary of the appraiser; as such, the appraiser has no preconceived interest in the cost of the house. This means that he will render services with impartiality and objectivity regardless for whom the appraisal is produced.

Myth: The replacement cost of the property is always is on par with the market value.

Fact: Without any influence from any outside parties to buy or sell, market value is what a willing buyer would pay a willing seller for a specific house. If the home were rebuilt, the dollar amount required to do so would form the replacement cost.

Myth: Appraisers use a formula, like a certain price per square foot, to arrive at the cost of a house.

Fact: An appraisal report is a collection of data concluded from the house's size, location, proximity to undesirable facilities, the condition of the property and the price of recent comparable sales. You can depend on 's staff to be ethical in assessing this information.

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

Fact: Any value at which an appraiser arrives in regards to a certain home is always personalized, based on certain factors pulled from the data of comparable homes and other considerations within the property itself. It makes no difference if the economy is good or on the decline.

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Myth: You can usually see what a property is worth simply by looking at the exterior.

Fact: To conclude an accurate price beyond all doubt, an appraiser must inspect the property on a variety of factors based on location, condition, improvements, amenities, and market trends. An exterior inspection definitely can't provide all of the data necessary.

Myth: Since the consumer is the one who provides the money to pay for the appraisal when applying for a loan for any real estate transaction, by law the appraisal is theirs.

Fact: Unless a lender releases its vestment in the report, it is legally owned by the lending company that ordered the appraisal. Due the Equal Credit Opportunity Act, any consumer requesting a copy of the report must be given it by their lending agency.

Myth: It doesn't mean anything to consumers what's in the report so long as it satisfies the necessities of their lending company.

Fact: A home buyer should definitely inspect their document; there could be some questions or some concerns about the accuracy of the inspection that should be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. There is an incredible amount of information contained in an appraisal report that will probably 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 area.

Myth: There is no reason to hire an appraiser unless you are trying to get an estimate of the cost of a property during a sales transaction involving a lending company.

Fact: Depending upon their qualifications and designations, appraisers can and may perform a lot of services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.

Myth: A home inspection serves the same purpose as an appraisal.

Fact: Appraisal reports are completely different than a home inspection report. The purpose of the appraiser is to come to an opinion of value in the appraisal process and through producing the report. House inspectors will compose a report that will determine the condition of the property and its major components and possible damage.