Nov 18, 2009
Home Appraisal Explained
An appraisal helps determine the market value of your property. This is also known as the fair market value comparison or a market analysis. A home appraisal is an estimate of the worth of your property in an open and competitive market.
Whether you are buying, selling or trying to get a home equity loan, an appraisal is important. Being the seller, you would want the best possible price for your home and the appraisal process can help you. On the other hand, a buyer has to know whether the appraised value of the property is less or more than the asking price.
If you want to hire a professional to appraise your property, be prepared for an expensive and time-consuming appraisal. If you want a quick and affordable one, you can consult a service on the internet that could access all the data and report to your fast. Both appraisals contain the same important information and have the same guidelines.
A good appraisal should be an unbiased, professionally based opinion of your home and its market value based on the quality of functionality, appearance, construction and the value of similar homes in the real estate market.
Steps in a Home Appraisal:
1. Your homes’ value can be estimated by comparing similar homes that have sold recently. You can initially appraise by looking at the neighborhood and find similar property in the neighorhood that have the same surroundings, lifestyle, income, average age and home values. Recreational facilities and amenities should also be considered.
2. To determine the price of your property, you should be able to compare it to the fair market value. This process uses the principle of substation. This means that the maximum value of your home is set by the price of comparable substitute home for a certain day and time. You should at least find three homes that have sold recently that have the same amenities and characteristics that your home have.
3. Make the necessary value adjustments between similar homes and your home. This put the properties being compared as equal. The comparable homes are adjusted to get the value of the subject, which is your home. Do not adjust the value of your property. If the two similar homes are identical with yours, except that your home has a deck, then it means your home will have a higher appraisal value than the two homes in comparison.
To get ready for an appraisal, it is necessary to clean your home and make it appear cozy and conducive to living. Clutters should be removed and if possible, you can upgrade your home and add a fresh new paint to it. This could add to the appraisal value of your property. The best way to an appraisal is to have a thorough research of the final criterion. The value of comparable properties in the neighborhood, determine the market trends. Be alert on this and change your selling strategies and timing in order to get much benefit from an appraisal.
Watch the video related to home appraisal
Quicken Loans TV takes you through a full home appraisal inspection in this informative video – part 5 (outside, the exterior of the home and a discussion of comparables) of the Quicken Loans Appraisal series. A home appraisal is something youll need when getting a mortgage. For more information on appraisals go to www.quickenloans.com
Help answer the question about home appraisal
Are home appraisals by a county tax assessor generally the same value as a home appraisal, or are they less?
I recently inherited a house. The value appraised by the county tax office was recently determined. It’s about $100K lower than the market value based on an independent survey of comparable homes in the neighborhood done a few months ago. From what others have told me, the county’s appraisal for tax purposes is generally much less than the actual market value. Is this true?
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The Tax assessment is just what the county assessor thinks the property is worth. It can be based on comparable homes in the area or the price paid for the property previously. It also is based on a set of figures the assessor has based on square footage, garages, condition of the home. If it's brick it assesses for more than wood, etc….
There is no way of telling what the appraisal will be, however you should make your offer to purchase subject to the property appraising at or above the asking price.
Good luck!
First of all some of these folks are NOT reading your question.
do you have a copy of this appraisal for 220k? you should with your closing paperwork. If that appraisal did show 220k and your appraiser proved to you an appraisal was at 183k. Then yes they fraudulently inflated your appraisal. Even if it was a glitch the lender is held accountable for that number. Is full spectrum lending a broker? who ever they are they need to help you. Contact them, you need to file a investigation in their company NOW someone may have inflated your appraisal to get a sale. Countrywide has a good rep. and they will want to take care of this. No luck with dealing with the lender or broker where they will not help you. File a complaint with your states attorney generals office, dept of commerce and better business bearu. They will investigate this and discipline accordingly.
Amer quest mortgage did this same kind of crap inflating mortgage and had to help the individuals affected by this and got slapped with a huge fine.
First deal with you orginator make a honest effort, they do not want you do go to any of the departments listed above. Ball is in your court.
Yes the markets are falling down but it seems like you home has gained 183to185
good luck
Your correct FHA loans do only require a 3.5% cash investment from the borrower and the seller can pay up to 6% of all your closing cost. Depending on the price of the home not always does the 6% cover all of the closing cost and prepaid items. Depending on the lender some require more money to be held in reserves.
What type of loan were you getting? Purchase, no-cash out refi, cash-out refi, what?
Basically, an appraisal is a professional estimate of the value of one's property. Apparently, the home did not appraise high enough for the type of loan you were seeking. Did the lender suggest lowering your loan amount? This happens, i.e. home doesn't appraise high enough, but lenders can sometimes (NOT ALWAYS) work around this by lowering the loan amount. On a purchase, it's a bit more complicated because normally the purchase price has to match the appraised value (that stipulation is in most real estate purchase contracts) and you get into amending the contract, etc. I would contact your mortgage company and see what options are available.
You can only use the home buyers tax credit as the down payment if it is set up to do so in your state. Not all states have drafted laws letting people use it. Most states, you have to buy and close on the house before being able to amend your 2008 return and getting it.
Didn't you get a good faith estimate of what you needed to bring to closing as far as funds?
The bank will not send out an appraiser, but instead look at the "comps" in the area and get a good idea of what the property is worth today.
They will look at the improvements that you have made to your property then compare your property to the other like properties that have sold in the area within the last six months. They will adjust what they think the value is up or down compared to those properties.
That is what Realtor's do when they give a Comparative Price/Market Analysis to determine the price of what a property should be listed for.
Sell it .
Welcome to the World of con artists!
A mortgage company can tell an appraiser the numbers they need to have written on an appraisal. If the appraiser decides he wants lot of business from the mortgage company, he will do what he is told. As in all businesses, there are those who don't deserve a license.
An appraisal is an opinion. Some can jack up the comparisons so high, they're up in the clouds. It sounds like this is what Countrywide did for you, a common occurrence with this company. You can bet that appraiser gets quite a bit of business from them. Money talks.
In the meantime, run, don't walk…away from them. Talk to a local banker, credit union or even mortgage company right in your hometown about what happened and what you need to do to get this mortgage straightened out. Stay away from TV ads and on line mortgage companies.
Take your 2 appraisals and send a letter to your State licensing board for review. There was no glitch (as they told you) and unfortunately has cost you some extra money.
The best thing you need to do now is get it straightened out and fast so you can get out of those high interest rates.
Good Luck! (Sorry this happened to you and countless others)
The mortgage industry needs law and regulations to stop scamming people.
So what is your question????
why are you not refinancing with the company that already holds your mortgage? they are usually willing to match any other companies as far as rates are concerned. The new company that has appraised your house less will not give you a mortgage for more than they think the house is worth, The original company may have inflated the value. which could be costly to them if you don't pay the loan. If they foreclosed and sold the home they would not get all their money. Stay with the original lender, get them to match any other offers. and hire an independent appraiser. that is not connected to either company and see what his value is. then take the 3 appraisals and average them. Appraisers hired by the mortgage company are working for them and sometimes put a value on a property that is higher or lower depending on what the bank requires to finance you.