Appraisal myths debunked
Legally, an appraiser has to be state certified to perform legitimate real estate appraisals for federally-backed sales. You also have the right to request a copy of the completed appraisal 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 will be equivalent to the market value.
Fact: It is probable that Missouri, like most states, supports the common myth that the assessed value is the same as the market value; however, this is not always true. At times when interior remodeling has occurred and the assessor is unaware of the improvement or other houses in the area have not been reassessed for quite some time, it may vary wildly.
Myth: Depending on if the appraisal is ordered for the buyer or the seller, the cost of the house will vary.
Fact: The opinion of value of the home does not affect the pay of the appraiser; as such, the appraiser has no pressured interest in the opinion of value of the home. Obviously, he will render job with impartiality and objectivity regardless for whom the appraisal is conducted.
Myth: Market value should be the same as replacement cost.
Fact: Market value is acquired by what a willing buyer would likely pay a willing seller for a particular house, with neither being under duress to buy or sell. The dollar amount needed to rebuild a house is what shows the replacement cost.
Myth: There are certain methods that real estate appraisers use to determine the opinion of value of a home, such as the price per square foot.
Fact: There are many differing processes that an appraiser will use to make a full investigation of every factor pertaining to the property, such as the size, location, condition, how close it is to certain facilities and the worth of recently sold comparable homes.
Myth: In a robust economy - when the prices of properties in a given region are reported to be increasing by a particular percentage - the worth of individual homes in the area can be expected to rise by that same percentage.
Fact: Price increase of a specific property is always determined on a case-by-case basis, factoring in data on comparable homes and other relevant specifications within the house itself. This is true in excellent economic times as well as poor.
Have other questions about appraisers, appraising or real estate in Saint Louis County or Chesterfield, MO?Contact our professional staff
Myth: The house's outside is determinate of the actual value of the home; it is unnecessary to do an interior inspection.
Fact: Home value is determined by a multitude of factors, including location, condition, improvements, amenities, and market trends. An outside-only inspection definitely can't provide all of the data needed.
Myth: Considering that the consumer is the person who puts up the money to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal report belongs to them.
Fact: Legally, the report is owned by the lender unless the lender releases their interest in the appraisal. Consumers have to be given a version of the appraisal report upon written request due to the Equal Credit Opportunity Act.
Myth: It doesn't matter to consumers what's in the appraisal so long as it meets the requirements of their lender.
Fact: It is very important for home buyers to read a copy of their appraisal so that they can double-check the accuracy of the document, in case it's required to question its accuracy. Remember, this is probably the most expensive and important investment a consumer will ever make. There is an incredible amount of data 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 vicinity.
Myth: Appraisals are ordered only to estimate house values in home sales involving mortgage-lending deals.
Fact: Depending upon their qualifications and designations, appraisers can and often do provide a series of different 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 report.
Fact: Appraisal reports are nothing like a home inspection report. The job of the appraiser is to come to an opinion of value in the appraisal process and through writing the report. House inspectors will compose a report that will determine the condition of the house and its major components and possible damage.