What You Should Know About Home Appraisals

When beginning the process of purchasing a home, your mortgage lender would want to know whether the house that you are interested in buying is worth the amount that you are interested in spending. They need to inspect the house for anything that could devalue the home or increase the properties. An appraiser is then brought in to complete this process. Here are four simple questions in regards to the home appraisal process.

Question: What is a home appraisal?

Answer: A property appraisal is an estimate of a property’s value. The property value is based on many factors including but not limited to the property location, amenities, structural condition, and the recent selling price of similar properties in the area. The home appraiser would walk through the home in search of anything that can alter the home’s value. The appraiser will take note of the properties layout and will look for any safety code violation.

Question: Who performs home appraisals?

Answer: Estate appraisers are third-party certified or licensed contractors. Usually, the lender would hire the third party appraiser. The appraiser is knowledgeable about real-estate and is required to know to evaluate a property based on factors such as neighborhood growth, neighborhood housing trends and the most recent market conditions.

Question: Who Pays for Home Appraisals?

Answer: The cost of home appraisals depends on the property value, location, and size of your property. The cost of a home appraisal varies and typically the buyer pays the fee at closing but paying upfront is not out of the norm. There are also other options such as a “drive-by appraisal” which most lenders will not accept that form of appraisal.

Question: How long does a home appraisal take?

Answer: For most loans, a property assessment may take a few hours. The turnaround time may take up to seven business days, although a busy market can mean a longer wait. The final documents will be given to the lender who is required to show it to the buyer. Always ask for a copy for your own purposes.