Appraisal myths debunked
It is required by the government that a real estate appraiser needs to be state-licensed to produce appraisals for federally-related real estate purchases in Alabama. Also by law, you have the ability to receive a copy of the completed appraisal from your lending agency. Contact Shamrock Appraisals, Inc. if you have any concerns about the appraisal procedure.
Myth: Market value will always be the same as the assessed value of the property.
Fact: While most states support the suggestion that assessed value approximates estimated market value, this usually is not the case. Examples include when interior remodeling has occurred and the assessor does not know about the improvements, or when homes in the vicinity have not been reassessed for an extended period of time.
Myth: The appraised value of a house will vary depending upon if the appraisal is conducted for the buyer or the seller.
Fact: The appraised value of the property does not affect the payment of the appraiser; due to this, the appraiser has no pressured interest in the worth of the home. Obviously, he will render task with impartiality and objectivity regardless for whom the appraisal is conducted.
Myth: The replacement cost of the property is always is on par with the market value.
Fact: Market value is found by what a willing buyer would be interested in paying a willing seller for a certain house, with neither being under undue influence to buy or sell. If the home were reconstructed, the dollar amount needed to do so would be the replacement cost.
Myth: Appraisers use a formula, like a certain price per square foot, to come to the value of a house.
Fact: Appraisers complete a detailed analysis of all factors pertaining to the value of a home, including its location, condition, size, proximity to facilities and recent opinion of value of comparable homes.
Myth: When the economy is robust and the sales prices of homes are found to be increasing by a certain percentage, the other homes in the area can be expected to rise based on that same percentage.
Fact: Cost appreciation of a specific home has to be determined on a case-by-case basis, factoring in information on comparable homes and other relevant specifications within the property itself. It makes no difference whether the economy is excellent or on the decline.
Have other questions about appraisers, appraising or real estate in Tuscaloosa County or Tuscaloosa, AL?Contact our professional staff
Myth: The home's outside is determinate of the actual worth of the house; it is unnecessary to do an interior appraisal.
Fact: To conclude an accurate price beyond all doubt, an appraiser must examine the home on a variety of factors based on area, condition, improvements, amenities, and market trends. An exterior inspection certainly can't provide all of the information necessary.
Myth: Because consumers pay for appraisal reports when applying for loans to purchase or refinance their property, they own their appraisal.
Fact: Unless a lender releases its vestment in the appraisal report, it is legally owned by the lending agency that ordered the appraisal. However, consumers have to be given a copy of the document upon written request, because of the Equal Credit Opportunity Act.
Myth: There's no reason for home buyers to even care about what the report contains so long as their lending company is satisfied.
Fact: Only if home buyers look at a copy of their appraisal can they double-check its accuracy and possibly need to question the result. 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, containing useful and often-revealing data - 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.
Myth: Appraisers are hired only to assess home values in property sales involving mortgage-lending deals.
Fact: Ordering an appraisal can fulfill a variety of needs depending on the designations and certifications of the appraiser involved; appraisers can perform a multitude of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: An appraisal is the same as a home inspection report.
Fact: A home inspection report has a completely different purpose than an appraisal. An appraiser concludes on an opinion of value in the appraisal process and resulting report. A home inspector analyzes the condition of the building and its major components and reports these findings.