Appraisal myths debunked
By law, an appraiser is enforced to be state-licensed to offer appraisals for federally-backed purchases. You have the ability to receive a copy of the finished appraisal report from your lender. Contact our professional staff if you have any questions about the appraisal process.
Myth: The value that is ascertained by the appraiser must be equivalent to the market value.
Fact: It could be that California, like most states, supports the suggestion that the assessed value is the same as the market value; however, this is sometimes the exception rather than the rule. Interior reconstruction that the assessor has not investigated and a lack of reassessment on nearby houses are exact examples of why this occurs.
Myth: The buyer or the seller often will have some pull in the cost of the home depending upon for whom the appraiser is working.
Fact: The appraiser has no personal interest in the result of the appraisal and should conduct services with independence, objectivity and impartiality - no matter for whom the appraisal is provided.
Myth: Market value will be the same as replacement cost.
Fact: Market value is found by what a willing buyer would likely pay a willing seller for a specific property, with neither being under pressure to buy or sell. Replacement value is the dollar amount needed to rebuild a property in-kind.
Myth: Appraisers use a formula, like a specific price per square foot, to figure out the worth of a home.
Fact: An appraisal report is an assertion of data based on the house's size, location, proximity to some facilities, the condition of the house and the cost of recent comparable sales. You can rely on WalshStreet Appraisals's staff to be forthright in assessing this data.
Myth: As homes appreciate by a specific percentage - in a strong economic state - the properties in proximity are figured to appreciate by the same amount.
Fact: All appreciation of value is on an individual basis, determined by information on relevant considerations and the data of comparable houses. It makes no difference whether the economy is powerful or poor.
Have other questions about appraisers, appraising or real estate in Los Angeles County or Los Angeles, CA?Contact WalshStreet Appraisals
Myth: The house's exterior is determinate of the actual worth of the property; it is unnecessary to do an interior appraisal.
Fact: There are a multitude of different variables that determine the value of a house; these factors include location, condition, improvements, amenities, and market trends. There's no real way to get all of this information from just inspecting the house from the exterior.
Myth: Because consumers fund appraisal reports when applying for loans to purchase or refinance their home, they legally own their appraisal.
Fact: The document is, in fact, legally owned by the lending agency - unless the lender "relinquishes its interest" in the appraisal report. However, consumers must be given a copy of the appraisal report upon written request, because of the Equal Credit Opportunity Act.
Myth: Consumers need not care about what is in their appraisal document so long as it meets the requirements of their lending institution.
Fact: A home buyer should definitely read through their appraisal report; there might be some questions or some worries about the accuracy of the appraisal report that must be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the appraisal report makes a near perfect record for future reference, containing useful and often-revealing information - including 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.
Myth: The only reason someone would hire an appraiser is if a property needs its worth assessed in a lender sales transaction.
Fact: Based upon their qualifications and designations, appraisers can and often do provide a variety of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: A home inspection serves the same purpose as an appraisal.
Fact: Appraisal reports are completely different than a home inspection. The job of the appraiser is to come to an opinion of value in the appraisal process and through creating the report. The point of a home inspector is to find the condition of the home and its main components, then compose a report on these findings.