Appraisal myths & facts
Legally, a real estate appraiser must be state certified to create legitimate appraisal reports for federally-related purchase. Also by law, you are allowed to demand a copy of the finished appraisal from your lender. Contact our professional staff if you have any concerns about the appraisal procedure.
Myth: Assessed value will always be the same as to market value.
Fact: This usually isn't true; most states do support the concept that the assessed value is the same as market value, but not always. Examples include when interior reconstruction has occurred and the assessor has not seen the improvements, or when houses in the area have not been reassessed for an prolonged time.
Myth: The buyer or the seller may have an influence in the cost of the house depending upon for whom the appraiser is working.
Fact: There is no personal interest on the part of the appraiser in the outcome of the analysis, therefore he will conduct his work with impartiality and independence, despite for whom the appraisal is conducted.
Myth: The replacement cost of the property should be is on par with the market value.
Fact: Market value is derived from what a willing buyer would likely pay a willing seller for a particular property, with neither being under pressure to buy or sell. Replacement value is the dollar amount required to reconstruct a house in-kind.
Myth: There are certain ways that appraisers use to show the value of a property, like the price per square foot.
Fact: There are many differing processes that an appraiser will use to make a detailed investigation of every factor pertaining to the property, such as the size, location, condition, how close it is to specific facilities and the sales price of recently sold comparable properties.
Myth: As homes increase their worth by a certain percentage - in a robust economic state - the homes around the appreciating properties are figured to appreciate by the same amount.
Fact: Value appreciation of a certain 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.
Have other questions about appraisers, appraising or real estate in Travis County or Pflugerville, TX?Contact our professional staff
Myth: The property's exterior is determinate of the actual value of the home; there is no need to do an interior inspection.
Fact: There are a multitude of different variables that conclude the value of a house; these factors include area, condition, improvements, amenities, and market trends. There's no real way to get all of this data from just inspecting the property from the exterior.
Myth: Since you're the one paying for the appraisal when applying for your loan to purchase or refinance your home, you own the ordered appraisal.
Fact: Unless a lending agency releases its interest in the document, it is legally owned by the lending company that ordered the appraisal. Home buyers have to be given a copy of the report upon written request due to the Equal Credit Opportunity Act.
Myth: Consumers need not be concerned with what is in their appraisal report so long as it satisfies the needs of their lending company.
Fact: It is a very good idea for home buyers to go through a copy of their appraisal so that they can verify the accuracy of the report, in case it's required to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. An appraisal report can double as a record for the future, containing a great deal of information - including, but not limited to 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 home needs its cost assessed in a lender sales transaction.
Fact: Appraisers can have many different qualifications and designations which allow them to perform a variety of different services including - but definitely not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: An appraisal report is the same as a home inspection report.
Fact: An appraisal does not serve the same purpose as an inspection report. An appraiser finds an opinion of value in the appraisal process and resulting report. House inspectors will compose a report that will express the condition of the house and its major components and possible damage.