Appraisal myths debunked
Legally, a real estate appraiser is required to be state certified to perform substantiated appraisal reports for federally-related transactions. Also by law, you have the right to receive a copy of the finished appraisal report from your lending agency. Contact Appraise Colorado Inc if you have any concerns about the appraisal procedure.
Myth: The value that is ascertained by the appraiser should be the same as the market value.
Fact: It could be that Colorado, like most states, supports the idea that the assessed value equates to the market value; however, this is not often the case. Examples include when interior remodeling has occurred and the assessor does not know about the improvements, or when houses in the area have not been reassessed for an prolonged period of time.
Myth: Depending on whether the appraisal is done for the buyer or the seller, the opinion of value of the home will vary.
Fact: There is no vested interest on the part of the appraiser in the outcome of the report, therefore he will conduct his work with impartiality and independence, regardless for whom the appraisal is written.
Myth: The replacement cost of the home should be is on par with the market value.
Fact: The way market value is found is based on what a home buyer would likely pay a willing seller for a property without being under pressure from any external party to buy or sell. Replacement cost is the dollar amount required to rebuild a property in-kind.
Myth: Appraisers use a calculation, such as a certain price per square foot, to figure out the cost of a property.
Fact: An appraisal report is a collection of data concluded from the home's size, location, proximity to specific facilities, the condition of the home and the worth of recent comparable sales. You can count on Appraise Colorado Inc's staff to be forthright in assessing this information.
Myth: In a powerful economy - when the values of properties in a given region are found to be increasing by a particular percentage - the prices of individual homes in the area can be expected to rise by that same percentage.
Fact: All appreciation of value is on a one-on-one basis, determined by information on relevant elements and the data of comparable homes. It doesn't matter if the economy is doing well or declining.
Have other questions about appraisers, appraising or real estate in Arapahoe County or Parker, CO?Contact Appraise Colorado Inc
Myth: The home's exterior is determinate of the actual value of the property; there is no need to do an interior appraisal.
Fact: To determine an accurate value beyond all doubt, an appraiser must examine the property on a variety of factors based on area, condition, improvements, amenities, and market trends. An external inspection certainly can't provide all of the information necessary.
Myth: Since you're the one paying for the appraisal when applying for the loan to buy or refinance real estate, you own the produced appraisal.
Fact: The appraisal is, in fact, legally owned by the lending agency - unless the lender "relinquishes its interest" in the report. However, home buyers must be given a copy of the document upon written request, through the Equal Credit Opportunity Act.
Myth: Consumers need not be concerned with what is in their appraisal so long as it meets the needs of their lending agency.
Fact: It is almost imperative for home buyers to check over a copy of their report so that they can double-check the accuracy of the document, in case it's required to question its veracity. 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, containing useful and often-revealing data - 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: Appraisals are ordered only to estimate home values in home sales involving mortgage-lending transactions.
Fact: Hiring an appraiser can fulfill a variety of necessities depending on the designations and certifications of the appraiser involved; appraisers can perform a variety of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: An appraisal report is the same as a home inspection report.
Fact: A home inspection serves a completely different purpose than an appraisal report. An appraiser decides upon an opinion of value in the appraisal process and resulting report. A home inspector determines the condition of the house and its main components and reports these findings.