What is an home appraisal
Date: February 19, 2016 Author: Damon Harris
When you are buying a home, your mortgage lender will need to make sure the house you’re buying is worth what you are paying for it. They need to check out the house for anything that can reduce the home’s value. The find out the value by getting an appraisal.
So what exactly is an appraisal…well you know we have some answers!!
What Is a Home Appraisal?
A property appraisal is an estimate of a property’s value. Property value is based on such factors as location, amenities, structural condition and recent sales of similar local properties.
A home appraiser conducts the process. The appraiser will do a walk-through of the property, noting anything that can alter the home’s value.
The appraiser will sketch and take photos of the property layout and will look for any safety code violations. If there are any, you may need to fix them before the lender approves the loan.
Who Performs Home Appraisals?
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.
Who Pays for Home Appraisals?
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—also known as a GFE—given to you by the lender will supply a fee for the appraisal.
How Long Do Home Appraisals Take?
For most loans, a typical property assessment takes a few hours or less, and a “drive-by” assessment will take significantly less time. Turnaround time should be within seven business days, although a busy market can mean a longer wait.
The appraiser will give the final documents—called the appraisal report—to the lender, who is required to show it to the buyer. Make sure you obtain a copy for your own records.