Common myths about appraising
Legally, an appraiser is required to be state certified to write legitimate appraisal reports for federally-supported transactions. The law gives you the right to receive a copy of your finished appraisal from your lender after it has been produced. Contact our professional staff if you have any concerns about the appraisal procedure.
Myth: Market value will be the same as the assessed value of the property.
Fact: This is not often the case; most states do support the suggestion that the assessed value is the same as market value, but not always. Examples include when interior reconstruction has occurred and the assessor does not know about the improvements, or when properties in the vicinity have not been reassessed for an prolonged period of time.
Myth: Depending on if the appraisal is provided for the buyer or the seller, the appraised value of the home will vary.
Fact: There is no real interest on the part of the appraiser in the result of the appraisal, therefore he will complete his work with impartiality and independence, no matter for whom the appraisal is written.
Myth: Any time market value is found, it should be similar to the replacement cost of the house.
Fact: The way market value is derived is based on what a home buyer would be willing to pay a willing seller for a property without being under influence from any outside party to buy or sell. The replacement cost is the dollar amount needed to rebuild a home in-kind.
Myth: Specific formulae, like the price per square foot of the property, are the ways appraisers use to arrive at the price of a house.
Fact: An appraisal is an amalgamation of information based on the home's size, location, proximity to undesirable facilities, the condition of the home and the value of recent comparable sales. You can depend on Choice Appraisals, Inc.'s appraisers to be forthright in assessing this data.
Myth: As houses increase their worth by a specific percentage - in a robust economy - the properties within the same neighborhood are expected to appreciate by the same amount.
Fact: Cost appreciation of a certain house has to be determined on a case-by-case basis, factoring in information on comparable properties and other relevant specifications within the home itself. It makes no difference whether the economy is robust or on the decline.
Have other questions about appraisers, appraising or real estate in Ventura County or Newbury Park, CA?Contact Choice Appraisals, Inc.
Myth: The home's exterior is determinate of the actual price of the house; there is no need to do an interior inspection.
Fact: There are a multitude of different factors that determine the value of a house; these factors include area, condition, improvements, amenities, and market trends. As you can see, none of these factors can be found just by examining the property from the exterior.
Myth: Since the consumer is the one who provides the capital to pay for the appraisal when applying for a loan for any real estate transaction, by law the appraisal report belongs to them.
Fact: Unless a lending agency releases its vestment in the appraisal report, it is legally owned by the lending agency that purchased the appraisal. Under the Equal Credit Opportunity Act, any consumer demanding a copy of the report must be provided with one by their lending agency.
Myth: It doesn't matter to consumers what's in the report so long as it meets the necessities of their lending company.
Fact: A consumer should definitely look through their report; there might be some questions or some worries about the accuracy of the appraisal report that need to be addressed. 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, 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 area.
Myth: Appraisals are ordered only to assess home values in home sales involving mortgage-lending transactions.
Fact: Appraisers can have many different qualifications and designations which allow them to provide a lot of different services including - but definitely not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: There's no reason to get an appraisal if you get a home inspection.
Fact: An appraisal report does not fulfill the same purpose as an inspection. The appraiser forms an opinion of value in the appraisal process and resulting document. A home inspector analyzes the condition of the home and its main components and reports these findings.