Appraisal myths debunked

Legally, an appraiser must be state certified to create legitimate real estate appraisals for federally-backed purchase. The law gives you the right to get a copy of your completed appraisal from your lender after it has been provided. Contact Andres Appraisal Services, LLC. if you have any questions about the appraisal process.

Myth: Market value has to be equivocal to the assessed value of the property.

Fact: This usually isn't true; most states do support the idea that the assessed value is the same as market value, but not always. Interior reconstruction that the assessor is not aware of and a dearth of reassessment on nearby properties are excellent examples of why this occurs.

Myth: The opinion of value of a property will change depending upon if the appraisal is provided for the buyer or the seller.

Fact: The opinion of value of the property does not affect the pay of the appraiser; as such, the appraiser has no vested interest in the opinion of value of the property. What this means is he will conduct services with impartiality and objectivity regardless for whom the appraisal is created.

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

Fact: Market value is found by what a willing buyer would be interested in paying a willing seller for a certain house, with neither being under duress to buy or sell. Replacement value is the dollar amount needed to rebuild a property in-kind.

Myth: Certain methods, such as the price per square foot, are the ways appraisers use to determine the cost of a home.

Fact: There are many differing formulae that an appraiser will use to make a detailed investigation of every factor pertaining to the home, such as the size, location, condition, how close it is to certain facilities and the value of recently sold comparable homes.

Myth: As houses increase their worth by a specific percentage - in a robust economy - the homes around the appreciating properties are figured to appreciate by the same amount.

Fact: Cost increase of a specific home is always determined on a case-by-case basis, factoring in information on comparable homes and other relevant elements. This is true in excellent economic times as well as poor.

Myth: Just seeing what the home looks like on its exterior gives a good idea of its cost.

Fact: House value is determined by a number of variables, including location, condition, improvements, amenities, and market trends. An external inspection certainly can't provide all of the information needed.

Myth: Because consumers fund the appraisal when applying for loans to buy or refinance their house, they legally own their appraisal report.

Fact: Legally, the report is owned by the lending company unless the lender relinquishes their interest in the document. Because of the Equal Credit Opportunity Act, any home buyer demanding a copy of the appraisal report must be given one by their lending company.

Myth: There's no need for home buyers to even care about what the appraisal report contains so long as their lending institution is fine with the contents therein.

Fact: It is a very good idea for consumers to peruse a copy of their report so that they can double-check the accuracy of the report, in case they need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. An report can double as a record for the future, containing a great deal of information - including, but certainly 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 vicinity.