Appraisal myths & facts
Legally, a real estate appraiser needs to be state certified to produce legitimate real estate appraisals for federally-supported transactions. The law allows you to get a copy of your finished appraisal from your lender after it has been provided. Contact our professional staff if you have any concerns about the appraisal process.
Myth: Assessed value will always be equal to market value.
Fact: This usually isn't true; most states do support the idea that the assessed value is the same as market value, but not always. 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 period of time.
Myth: The buyer or the seller often will have an influence in the cost of the property depending upon for whom the appraiser is working.
Fact: There is no vested interest on the part of the appraiser in the result of the appraisal, therefore he will conduct his work with impartiality and independence, regardless for whom the appraisal is created.
Myth: Market value should equal replacement cost.
Fact: The way market value is arrived at is based on what a home buyer would likely pay a willing seller for a home without being under duress from any external group to purchase or sell. The dollar amount demanded to reconstruct a house is what forms the replacement cost.
Myth: Certain formulae, like the price per square foot of the property, are the methods appraisers use to arrive at the value of a home.
Fact: Appraisers make an exhaustive analysis of all factors pertaining to the worth of a house, including its location, condition, size, proximity to facilities and recent costs of comparable homes.
Myth: As properties increase their worth by a certain percentage - in a robust economic state - the homes around the appreciating properties are expected to increase by the same amount.
Fact: All appreciation of price is on a one-on-one basis, found by information on relevant considerations and the data of comparable properties. It makes no difference if the economy is robust or on the decline.
Have other questions about appraisers, appraising or real estate in Benton County or Camden, TN?Contact Furr Appraisal Service
Myth: Just examining what the home looks like on its exterior gives a good idea of its cost.
Fact: Home worth is concluded by a number of variables, including area, condition, improvements, amenities, and market trends. An external inspection definitely can't provide all of the data needed.
Myth: Because consumers pay for appraisal reports when applying for loans to purchase or refinance their home, they own their appraisal.
Fact: Legally, the appraisal is owned by the lending agency unless the lender releases their interest in the document. Because of the Equal Credit Opportunity Act, any consumer demanding a copy of the report must be provided with one by their lending company.
Myth: Home buyers need not be concerned with what is in their appraisal document so long as it exceeds the necessities of their lending company.
Fact: It is almost imperative for consumers to check over a copy of their report so that they can double-check the accuracy of the report, in case they need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. There is a great deal of information contained in an appraisal that should be useful to the consumer in the future, such as 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 proximity.
Myth: There is no reason to hire an appraiser unless you are trying to get an assessment of the value of a home during a sales transaction involving a lender.
Fact: Based upon their qualifications and designations, appraisers can and may provide a variety of services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: A house inspection serves the same purpose as an appraisal.
Fact: Appraisal reports have almost nothing in common with a home inspection report. The purpose of the appraiser is to conclude an opinion of value in the appraisal process and through producing the report. House inspectors will write a report that will show the condition of the house and its major components and possible damage.