Appraisal myths & facts
Legally, an appraiser has to be state certified to create substantiated appraisal reports for federally-backed purchase. Also by law, you have the right to receive a copy of the finished report from your lender. Contact our professional staff if you have any concerns about the appraisal process.
Myth: The value that is assessed by the appraiser must be equivalent to the market value.
Fact: This is not often the case; most states do support the concept that the assessed value is the same as market value, but not always. Examples include when interior reconstruction has happened and the assessor is unaware of the improvements, or when houses in the vicinity have not been reassessed for an prolonged period.
Myth: Depending on whether the appraisal is done for the buyer or the seller, the value of the home will vary.
Fact: The opinion of value of the house does not affect the pay of the appraiser; as a result, the appraiser has no personal interest in the cost of the house. What this means is he will conduct job with impartiality and independence regardless for whom the appraisal is provided.
Myth: The replacement cost of the property should be is on par with the market value.
Fact: The way market value is derived is based on what a buyer would be willing to pay a willing seller for a home without being under duress from any outside party to purchase or sell. The dollar amount needed to reconstruct a property is what constitutes the replacement cost.
Myth: There are certain methods that real estate appraisers use to determine the opinion of value of a home, like the price per square foot.
Fact: An appraisal is an assertion of information based on the property's size, location, proximity to specific facilities, the condition of the house and the price of recent comparable sales. You can count on Graham Appraisal's staff to be ethical in assessing this data.
Myth: As houses increase their worth by a specific percentage - in a strong economic state - the properties around the appreciating properties are expected to increase by the same amount.
Fact: Any cost at which an appraiser concludes concerning a certain home is always personalized, based on certain factors found from the information of comparable properties and other considerations within the house itself. This is true in good economic times as well as poor.
Have other questions about appraisers, appraising or real estate in Barren County or Glasgow, KY?Contact us
Myth: Just seeing what the property looks like on its exterior gives an idea of its value.
Fact: House value is determined by a multitude of factors, including - but not limited to - area, condition, improvements, amenities, and market trends. There's no possible way to get all of this data from just looking at the property from the exterior.
Myth: Because consumers fund appraisals when applying for loans to purchase or refinance their house, they legally own their appraisal report.
Fact: The appraisal report is, in fact, legally owned by the lending agency - unless the lender "relinquishes its interest" in the document. Because of the Equal Credit Opportunity Act, any home buyer demanding a copy of the appraisal report must be provided with it by their lender.
Myth: There's no need for home buyers to even care about what the appraisal contains so long as their lending institution is satisfied.
Fact: Only if consumers read a copy of their report can they double-check 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 near perfect record for future reference, filled with 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.
Myth: There is no reason to hire an appraiser unless you are trying to get an assessment of the cost of a house during a sales transaction involving a lending agency.
Fact: Depending upon their qualifications and designations, appraisers can and will perform a lot of services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: An appraisal report is no different than a home inspection.
Fact: A home inspection report serves a completely different purpose than an appraisal. The task of the appraiser is to find an opinion of value in the appraisal process and through writing the report. House inspectors will write a report that will determine the condition of the home and its major components and possible damage.