Appraisal myths debunked

Legally, an appraiser has to be state certified to produce substantiated real estate appraisals for federally-supported purchase. You have the ability to acquire a copy of the finished report from your lending agency. Contact Barnes Appraisal Company if you have any concerns about the appraisal procedure.

Myth: Assessed value should always equate to market value.

Fact: While most states uphold the concept that assessed value is equal to estimated market value, this often is not the case. Examples include when interior remodeling has occurred and the assessor does not know about the improvements, or when properties in the vicinity have not been reassessed for an extended time.

Myth: The buyer or the seller sometimes may have leverage in the value of the home depending upon for whom the appraiser is working.

Fact: The opinion of value of the property does not affect the payment of the appraiser; as such, the appraiser has no pressured interest in the worth of the property. Obviously, he will provide task with impartiality and independence regardless for whom the appraisal is provided.

Myth: Any time market value is established, it should equate to the replacement cost of the property.

Fact: Without any suggestion from any different parties to purchase or sell, market value is what a willing buyer would pay an interested seller for a specific home. Replacement cost is the dollar amount necessary to rebuild a property in-kind.

Myth: Appraisers use a calculation, such as a specific price per square foot, to conclude the worth of a home.

Fact: There are many different formulae that an appraiser will use to make a detailed investigation of every factor in consideration of the house, such as the size, location, condition, how close it is to specific facilities and the value of recently sold comparable houses.

Myth: In a strong economy - when the worth of properties in a given region are found to be rising by a certain percentage - the prices of individual houses in the proximity can be expected to rise by that same percentage.

Fact: All appreciation of price is on a one-on-one basis, concluded by data on relevant elements and the data of comparable houses. It doesn't matter if the economy is doing well or declining.

Myth: Just examining what the house looks like on its exterior gives an excellent idea of its cost.

Fact: To conclude an accurate value beyond all doubt, an appraiser must assess the home on a variety of factors based on area, condition, improvements, amenities, and current market trends. Obviously, none of these factors can be derived simply by inspecting the home from the outside.

Myth: Because consumers pay for the appraisal when applying for loans to buy or refinance their house, they legally own their appraisal report.

Fact: The appraisal report is, in fact, legally owned by the lender - unless the lender "releases its interest" in the report. Consumers have to be given a copy of the report upon written request because of the Equal Credit Opportunity Act.

Myth: Consumers need not be concerned with what is in their appraisal report so long as it satisfies the requirements of their lending company.

Fact: Only if home buyers examine a copy of their report can they ensure its accuracy and possibly need to question the result. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the appraisal makes a valuable record for future reference, comprised of useful and often-revealing information - including, but 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 vicinity.