A home's value is determined by a number of different variables that can go beyond the average market value. An accurate appraisal can help you buy or sell a home for a fair and advantageous price. When taking out a mortgage, your lender may even require you to have a home appraised. Before you delve into the world of home appraisal make sure you know the answers to the following questions:
What Is an Appraisal and Who Performs It?
An appraisal is a methodical evaluation of a property's worth, and generally is conducted by a licensed appraiser. A property appraiser-same thing as appraiser-normally has a knack for drawing local implications from national or industry real estate trends, has an eye for structural subtlety, is detail-oriented, and possesses the analytical bent necessary to cull data from multiple sources and prepare a clear and concise report. Appraisers play an important role in various real estate transactions, including purchases and sales of shopping malls, hotels, condominiums, single- and multiple-family abodes, and restaurants.
An important thing to note is that the appraiser function is heavily regulated, and the Appraisal Qualification Board establishes the minimum standards for licensing, experience, and education for appraisers.
What Does an Underwriter Heed When Reviewing a Property Appraisal?
An underwriter delves into a property appraisal report to understand the logic followed by the appraiser. In essence, the underwriter notes the property's value and makes sense of reasons why that value was set by the appraiser. In so doing, the underwriter reads sections of the appraisal that refer to things like the condition of the structure, environmental factors and key architectural features.
Will I Receive a Copy of the Appraisal?
You will receive a copy of the appraisal, either directly from the appraiser or from the lender at closing. The lender typically updates your application file as soon as the appraisal report is sent. Talk to your prospective creditor to see if you can receive a copy of the appraisal before closing.
I Want to Buy a Home. Do I Need Both an Inspection and an Appraisal?
Yes, you need both. Although both exercises are distinct, they help protect you as well as your loved ones and belongings against construction problems as diverse as leaking basements or roofs, termite damage, and dry rot. Detecting those construction hazards is the job of an appraiser, but he or she is not a construction expert. That's why you need a home inspector who can dive deeper into your house's structural situation-and perform tasks like inspecting the attic, turn on every light switch, reviewing mechanicals, and running every faucet.
It's best to join the home inspector as he or she canvasses your future residence. For you, this is a great opportunity to learn more about your house; understand upcoming maintenance schedules and tips; inquire about the house's condition; and find out more about fixtures, appliances, and major systems.
How Long Does the Appraisal Process Take?
Generally, it takes an experienced appraiser 10 to 14 days to complete an appraisal, a time frame that can be shorter if the appraiser is already familiar with the neighborhood or has recently performed property evaluations in the vicinity. After the appraisal report is sent to the underwriter, there might be some back-and-forth if the underwriter has more questions or wants to clarify a specific topic raised in the report.
You can reach out to both the underwriter and the appraiser if two weeks have passed and you haven't heard anything from both parties. Note also that potential delays may come from the fact that the appraiser is unable to get in touch with the real estate agent and/or the property owner to conduct the appraisal.