Appraisal myths & facts
Legally, an appraiser must be state certified to produce legitimate appraisal reports for federally-backed sales. You are also entitled by law to request a copy of the completed appraisal from your lender. Contact Amerappraise, LLC if you have any concerns about the appraisal procedure.
Myth: Market value needs to be equivocal to the assessed value of the property.
Fact: It is possible that Delaware, like most states, validates the suggestion that the assessed value equates to the market value; however, this is not often the case. Often when interior remodeling has been done and the assessor is unaware of the improvement or properties in the area have not been reassessed for quite a while, it may vary wildly.
Myth: Depending on if the appraisal is done for the buyer or the seller, the appraised value of the home will vary.
Fact: There is no personal interest on the part of the appraiser in the outcome of the appraisal report, therefore he will complete his work with impartiality and independence, no matter for whom the appraisal is created.
Myth: Market value will equal replacement cost.
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 specific home. Replacement value is the dollar amount needed to reconstruct a property in-kind.
Myth: There are certain methods that real estate appraisers use to show the opinion of value of a property, like the price per square foot.
Fact: There are many numerous processes that an appraiser will use to make a detailed investigation of every factor in consideration of the house, such as the size, location, condition, how close it is to certain facilities and the worth of recently sold comparable homes.
Myth: In a powerful economy - when the values of homes in a given region are found to be rising by a certain percentage - the values of individual properties in the area can be expected to increase by that same percentage.
Fact: All appreciation of value is on an individual basis, found by information on relevant considerations and the data of comparable properties. This is true in good economic times as well as bad.
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Myth: The house'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 factors that show the value of a house; these factors include location, condition, improvements, amenities, and market trends. As you can see, none of these variables can be found simply by inspecting the home from the exterior.
Myth: Because the consumer is the one who provides the funding to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal belongs to them.
Fact: The document is, in fact, legally owned by the lending agency - unless the lender "relinquishes its interest" in the report. Consumers must be supplied with a version of the report through request as per the Equal Credit Opportunity Act.
Myth: There's no point for home buyers to even care about what the report contains so long as their lending agency is satisfied.
Fact: Only if consumers read a copy of their appraisal report can they ensure its accuracy and possibly need to question the result. Remember, this is probably the most expensive and important investment a consumer will ever make. An report can serve as a record for the future, since it contains an incredible amount 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: Appraisers are hired only to assess real estate property values in home sales involving mortgage-lending deals.
Fact: Appraisers can have many varied qualifications and designations which allow them to provide a lot 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 no different than a home inspection.
Fact: A home inspection report serves a completely different purpose than an appraisal report. An appraiser concludes on an opinion of value in the appraisal process and resulting appraisal report. The point of a home inspector is to find the condition of the home and its main components, then write a report on their conclusions.