Appraisal myths debunked
By law, an appraiser must be state-licensed to offer appraisals for federally-supported sales. Also by law, you are allowed to demand a copy of the finished appraisal report from your lender. Contact us if you have any questions about the appraisal process.
Myth: The value that is ascertained by the appraiser will be the same as the market value.
Fact: It might be that Delaware, like most states, validates the idea that the assessed value equates to the market value; however, this is sometimes the exception rather than the rule. Examples include when interior remodeling has happened and the assessor has not seen the improvements, or when homes in the vicinity have not been reassessed for an prolonged period of time.
Myth: The buyer or the seller may have some pull in the cost of the home depending upon for whom the appraiser is working.
Fact: There is no vested interest on the part of the appraiser in the result of the report, therefore he will conduct his work with impartiality and independence, no matter for whom the appraisal is written.
Myth: Any time market value is found, it should be similar to the replacement cost of the property.
Fact: Market value is arrived at through 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. The dollar amount necessary to reconstruct a home is what forms the replacement cost.
Myth: Certain formulae, like the price per square foot, are the ways appraisers use to ascertain the price of a house.
Fact: Appraisers make a comprehensive analysis of all factors pertaining to the worth of a home, including its location, condition, size, proximity to facilities and recent costs of comparable homes.
Myth: In a powerful economy - when the prices of houses in a given area are reported to be increasing by a particular percentage - the values of individual houses in the area can be expected to appreciate by that same percentage.
Fact: Price increase of a certain property has to be determined on an individualized basis, factoring in information on comparable homes and other relevant considerations. It makes no difference if the economy is excellent or poor.
Have other questions about appraisers, appraising or real estate in New Castle County or Bear, DE?Contact Amerappraise, LLC
Myth: You can usually find what a house is worth simply by looking at the exterior.
Fact: There are a multitude of different variables that determine the value of a house; these factors include location, condition, improvements, amenities, and market trends. An exterior inspection certainly can't provide all of the data needed.
Myth: Since you're the one providing the money for the appraisal when applying for the loan to buy or refinance your home, you own the provided appraisal.
Fact: Legally, the document is owned by the lending company unless the lender releases their interest in the document. Consumers have to be given a copy of the document through request because of the Equal Credit Opportunity Act.
Myth: There's no point for home buyers to even worry about what the appraisal report contains so long as their lender is satisfied.
Fact: Only if consumers look over a copy of their appraisal report can they verify its accuracy and possibly need to question the result. 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 that should be useful to the home buyer 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 proximity.
Myth: There is no reason to hire an appraiser unless you are trying to get an estimate of the worth of a property during a sales transaction involving a lending institution.
Fact: Hiring an appraiser can fulfill a variety of necessities depending on the designations and certifications of the appraiser involved; appraisers can provide a multitude of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: There's no reason to get an appraisal if you order a home inspection.
Fact: An appraisal report does not serve the same purpose as an inspection report. The reason behind an appraisal report is to form an opinion of fair market value during the appraisal process and the completion of the appraisal report. A home inspector assesses the condition of the property and its major components and reports their findings.