Getting a real estate appraisal is a necessary part of the home buying process because your lender will require it before approving the sale. Although it’s unavoidable, the appraisal can benefit you as the home buyer. The answers to these commonly asked questions can help you understand more about this process.
Questions About Real Estate Appraisals Answered
Why is an appraisal needed?
A real estate appraisal helps to confirm that the selling price of the home is comparable to its market value. An appraiser will examine the condition of the home to ensure its quoted market value is accurate and won’t result in the buyer overpaying for the property. During the appraisal, other issues will be addressed as well, including any zoning issues that may affect the fair use of the property.
What happens during the process?
Typically, the appraiser counts the rooms and takes measurements of the living space. They will look for health and safety violations and note any features that affect the value of the property, such as pools, hot tubs, or decks. They will additionally evaluate the condition of the exterior of the home and lot.
What happens if they find something?
If the appraised value of the home is higher than the selling price, the lender won’t likely object to the sale. However, if the appraised value is lower than the asking price, the lender will only issue a mortgage that is equal to the appraised value.
In that case, the buyer has three options. To come up with enough cash to pay the difference between the appraised and selling prices, ask the seller to pay the difference, or challenge the appraisal and hire a second appraiser. Keep in mind that the second appraisal may not be very different.
What does the appraisal report include?
When you get the appraisal report, you’ll notice that it’s divided up into several sections. The first part explains the mathematical process used to arrive at the home’s value. This will be followed by an evaluation of the local real estate market, so you can see where the home fits into the market.
The report will share the home’s characteristics, such as square footage, number of bedrooms, and amenities, and it will list any renovations that have added to the home’s value. Finally, the report will share any other features, or any defects, that have affected the value of the home.
If you need a real estate appraisal, the team at Galvin Realty Group, Inc. will thoroughly perform one and deliver fast results. They’re a member of the Appraisal Institute in Rochester, NY, and they are backed by 50 years of real estate experience. This gives their team a thorough knowledge of the local real estate market that can benefit residential home buyers or commercial investors. To schedule an appointment, call (585) 546-1290 or visit their website to browse their services.