Appraisal myths & facts
By law, an appraiser needs to be state-licensed to produce appraisals for federally-related transactions. You also have the right to acquire a copy of the completed appraisal report from your lender. Contact us if you have any concerns about the appraisal process.
Myth: Market value has to be the same as the assessed value of the property.
Fact: While most states support the suggestion that assessed value is equal to estimated market value, this usually is not the case. Interior remodeling that the assessor is unaware of and a dearth of reassessment on nearby homes are perfect examples of why the price can vary.
Myth: The opinion of value of a property will change depending upon if the appraisal is ordered for the buyer or the seller.
Fact: The opinion of value of the home does not affect the pay of the appraiser; as such, the appraiser has no vested interest in the value of the house. This means that he will complete his task with impartiality and independence regardless for whom the appraisal is conducted.
Myth: The replacement value of the house should be is on par with the market value.
Fact: Without any suggestion from any outside parties to buy or sell, market value is what a willing buyer would pay a willing seller for a particular property. If the house were reconstructed, the dollar amount necessary to do so would set the replacement cost.
Myth: There are specific methods that real estate appraisers use to determine the cost of a property, like the price per square foot.
Fact: An appraisal is an assertion of information based on the house's size, location, proximity to some facilities, the condition of the house and the value of recent comparable sales. You can count on Graham Appraisal's appraisers to be ethical in assessing this information.
Myth: When the economy is strong and the cost of houses are reported to be rising by a certain percentage, the other homes in the vicinity can be expected to increase based on that same percentage.
Fact: Any value at which an appraiser concludes in regards to a specific home is always individualized, based on certain factors derived from the data of comparable homes and other specifications within the house itself. It makes no difference whether the economy is robust or bad.
Have other questions about appraisers, appraising or real estate in Barren County or Glasgow, KY?Contact our professional staff
Myth: Just seeing what the home looks like on its exterior gives an excellent idea of its value.
Fact: House worth is concluded by a multitude of variables, including - but not limited to - location, condition, improvements, amenities, and market trends. An exterior inspection definitely can't provide all of the information required.
Myth: Because the consumer is the party who puts up the funding to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal report belongs to them.
Fact: Unless a lender releases its vestment in the report, it is legally owned by the lending agency that purchased the appraisal. Due the Equal Credit Opportunity Act, any consumer demanding a copy of the report must be given one by their lending agency.
Myth: It doesn't matter to consumers what's in the appraisal report so long as it meets the requirements of their lending company.
Fact: It is very important for home buyers to check over a copy of their report so that they can double-check the accuracy of the document, in case they need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. An appraisal can double as a record for the future, as it contains an incredible amount 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 proximity.
Myth: The only reason someone would order an appraisal is if a home needs its worth estimated in a lender sales transaction.
Fact: Ordering an appraisal can fulfill a variety of necessities depending on the designations and certifications of the appraiser involved; appraisers can provide a great deal of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: An appraisal is no different than a home inspection report.
Fact: A home inspection has a completely different purpose than an appraisal report. The point of an appraisal is to conclude upon an opinion of fair market value during the appraisal process and the production of the appraisal report. The point of a home inspector is to approximate the condition of the house and its major components, then compose a report on their inspection.