What is an Appraisal?

A real estate appraisal is used to help establish the market value of a property. The determined value is based on many factors including location, size, home type, condition of the home, and so forth. Your real estate agent can give you a good estimate of your home’s worth using a comparative market analysis (CMA), but an appraisal is much more detailed and is the only valuation report a bank will consider when you ask to take out a loan.

About Appraisers and Appraisals

  • Appraisers are licensed by individual states after completing coursework and internship hours
  • Many lenders have an appraiser on staff, or contract with an independent appraiser
  • If you are allowed to choose the appraiser, and you choose someone that the lender isn’t familiar with, the results might be subject to review before they are accepted.
  • If you choose your appraiser, s/he should be an objective third party
  • You will most likely pay for the appraisal when you apply for your loan

What You Will See on an Appraisal Report

  • Details about the subject property
  • Side-by-side comparisons with three comparable (similar) properties
  • An evaluation of the overall real estate market in the area
  • Statements about issues the appraiser feels are harmful to the property’s value
  • Notations about seriously flawed characteristics of the property
  • An estimate of the average sales time for the property

If you have additional questions about Appraisals, CLICK HERE

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