Appraisal Report

FREE REPORT ON THE MOST FREQUENTLY ASKED QUESTIONS REGARDING REAL ESTATE APPRAISALS

Why do you want a professional real estate appraisal?

Much of America’s wealth lies in real estate. The job of the professional appraiser is to determine a property’s value by gathering and analyzing relevant information regarding your property and then comparing it with recent sales of similar properties in your area. Appraisers are important, impartial, third-parties who protect you from “over-paying” and also protect the lender from lending too much money on an over-valued property.

Where does an appraiser get their information to compare the value?

An appraiser gets information from a variety of sources, including the Realtors® Multiple Listing Service, tax assessor’s records, county records, private interviews (if information cannot be found publicly), other appraisers and personal knowledge of the area. Appraisers live and work in your community and they are very in tune with the local real estate market.

What’s the difference between an Appraisal and Home Inspection?

An appraiser walks through a home to measure the square footage, verify the number of rooms and the general condition of the home. However, an appraiser does not guarantee the condition of the home.

A Home Inspector is a trained individual who inspects the home to determine if the mechanical systems are working properly and that the structure of the home is sound. An appraiser may mention “potential” problems but you should rely on the expertise of a home inspector for a thorough evaluation.

What does an appraiser look for?

An appraiser looks for the following:

1. The condition of the property—both inside and out
2. The room layout and the traffic pattern from room to room
3. Whether the home has been updated and modernized
4. The estimated square footage of the home
5. Any unique features

An appraiser considers only the property that is “fixed” to the land. Amenities, such as, above ground swimming pools and portable sheds are not included when determining the value of your property.

If my appraisal is higher than the tax value, could my real estate taxes go up?

No. The appraiser is required to maintain confidentially with each client (either you or the mortgage company or bank) and does not disclose any information to the local tax assessor.

What’s the difference between a SHORT-FORM appraisal and FULL Appraisal?

A short-form appraisal relies on direct sales comparisons that have been previously reported into a central databank of other properties sold in the area. It is generally used if there is plenty of data available (like many of the same types of homes in a large subdivision that have sold recently) or if the lender does not require a “full” appraisal based upon the down payment and other underwriting factors. It is also used for tax grievances, uncontested divorces or other legal purposes.

A full appraisal requires a lot of detail to assist the lender in determining the property’s value based upon other sales in the area, the condition of the property and the highest and best use of the property.

What are “comparables”?

The “comparison approach” is looking at the prices paid for similar properties. While not all homes are “exactly” alike, values are given to each comparable property based upon location, square footage, lot size, the age of the home, market conditions (are values rising or falling), construction quality and other amenities, such as, fireplaces, built-in pools, garage size, decks, patios, porches, heating and cooling systems, etc.

What does “market value” really mean?

Market value is the “most probable” price that a willing seller and willing buyer are able to negotiate. It is based upon these assumptions:

1. Buyer and seller are motivated
2. Both parties are well-informed and well-advised of values
3. A reasonable time is allowed for other people to view the property
4. Payment is made in cash or mortgage (however, adjustments are made for unusual types of financing)
5. The sale is an “arms-length” sale (buyer and seller are completely independent and have no connection or relationship to each other)
   

   Did you know that you have a right to get a copy of your appraisal?

   Under the law, your lender must provide you with a copy of the appraisal if you send them a written request.

   This Free Report is provided to you by:

   Michael McIntosh
   The McIntosh Group
   @ Partners Mortgage