Appraisal myths debunked

By law, an appraiser must be state-licensed to produce appraisals for federally-related sales. Also by law, you have the ability to demand a copy of the finished appraisal from your lending agency. Contact Residential Appraisal Service, LLC if you have any concerns about the appraisal procedure.

Myth: The value that is ascertained by the appraiser is required to be equivalent to the market value.

Fact: This usually isn't true; most states do support the suggestion that the assessed value is the same as market value, but not always. Interior reconstruction that the assessor has not investigated and a dearth of reassessment on nearby houses are perfect examples of why there might be a differential in price.

Myth: The appraised value of a home will vary depending upon whether the appraisal is conducted for the buyer or the seller.

Fact: The appraiser has no vested interest in the result of the report and should complete his task with independence, objectivity and impartiality - no matter for whom the appraisal is conducted.

Myth: The replacement cost of the house is always is on par with the market value.

Fact: Without any suggestion from any outside parties to purchase or sell, market value is what a willing buyer would pay an interested seller for a particular house. Replacement cost is the dollar amount required to reconstruct a home in-kind.

Myth: There are certain methods that real estate appraisers use to find the value of a property, such as the price per square foot.

Fact: There are many different methods that an appraiser will use to make a comprehensive investigation of every factor in consideration of the house, such as the size, location, condition, how close it is to certain facilities and the opinion of value of recently sold comparable homes.

Myth: As properties increase their worth by a specific percentage - in a robust economy - the houses within the same neighborhood are expected to increase by the same amount.

Fact: Worth appreciation of a certain home has to be concluded on a case-by-case basis, factoring in data on comparable properties and other relevant specifications within the house itself. It makes no difference if the economy is excellent or on the decline.

Myth: The home's exterior is determinate of the actual worth of the home; there is no need to do an interior inspection.

Fact: House worth is concluded by a number of variables, including area, condition, improvements, amenities, and market trends. An outside-only inspection certainly can't provide all of the data needed.

Myth: Because consumers fund appraisal reports when applying for loans to buy or refinance their home, they legally own their appraisal.

Fact: The document is, in fact, legally owned by the lending agency - unless the lender "relinquishes its interest" in the document. Consumers must be supplied with a copy of the document upon written request as per the Equal Credit Opportunity Act.

Myth: It doesn't concern consumers what's in the report so long as it meets the needs of their lending company.

Fact: A consumer should definitely look through their appraisal; there might be some questions or some concerns about the accuracy of the analysis that should be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the report makes an invaluable record for future reference, comprised of 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 area.