09 Jan What is A House Appraisal?
A house appraisal is a monetary valuation of a property. It can be an appraisal to determine the fair market value of the property, or what the home should sell for on an open market, There are also appraisals to determine a property’s tax-assessed value, which determines how much property tax the homeowner must pay annually. Appraisals can be formal, performed by a professional property appraiser, or or informal appraisals by a real estate agent. If you are buying or refinancing a property, most lenders and mortgage guarantors like the FHA and VA will require a professional appraisal.
WHY IS A HOUSE APPRAISAL IMPORTANT?
No credible financial institution will lend you money for a house without an appraisal. The appraisal lets a bank or lender know what the loan collateral will sell for in a worst-case scenario. The bank doesn’t want to be stuck with a home that will bring far less than they lent on it. The home buyer shouldn’t want that either, of course. So appraisals exist for good reason. Home appraisals are conducted after you’ve negotiated a price, agreed to buy or sell the house and signed the contract. Everyone wants the appraisal close to the price that both seller and buyer have agreed on.
HOW MUCH DOES AN APPRAISAL COST?
The cost of home appraisals depends on the property value, location, and size of your property. They cost a few hundred dollars and typically the buyer pays the fee at closing, although you can opt to pay it up-front. A good faith estimate given to you by the lender will supply a fee for the appraisal.
HIRING A HOME APPRAISER
Appraisers are third-party certified or licensed contractors, and the lender usually hires them. They are knowledgeable in real estate and are required to know how to evaluate a property on factors such as neighborhood growth, neighborhood housing trends and market conditions. ProSaver has trustworthy, local home appraisers ready to work for you.