Appraisal myths & facts
By law, an appraiser is required to be state-licensed to perform appraisals for federally-backed transactions. The law gives you the right to get a copy of your completed report from your lender after it has been produced. Contact Shamrock Appraisals, Inc. if you have any concerns about the appraisal procedure.
Myth: The value that is assessed by the appraiser is required to be the same as the market value.
Fact: This usually isn't true; most states do support the idea that the assessed value is the same as market value, but not always. Interior remodeling that the assessor is not aware of and a dearth of reassessment on nearby houses are excellent examples of why there might be a differential in price.
Myth: The buyer or the seller can have leverage in the value of the house depending upon for whom the appraiser is working.
Fact: There is no personal interest on the part of the appraiser in the result of the report, therefore he will complete his work with impartiality and independence, regardless for whom the appraisal is created.
Myth: The replacement value of the property should be is on par with the market value.
Fact: Without any influence from any external parties to purchase or sell, market value is what a willing buyer would pay a willing seller for a particular property. Replacement value is the dollar amount needed to rebuild a house in-kind.
Myth: Specific formulae, like the price per square foot of the property, are the ways appraisers use to arrive at the worth of a home.
Fact: An appraisal report is an assertion of data concluded from the property's size, location, proximity to specific facilities, the condition of the property and the cost of recent comparable sales. You can count on Shamrock Appraisals, Inc.'s appraisers to be professional in assessing this data.
Myth: When the economy is robust and the worth of houses are reported to be rising by a certain percentage, the other properties in the neighborhood can be expected to rise based on that same percentage.
Fact: Cost increase of a specific home must be determined on an individualized basis, factoring in data on comparable homes and other relevant considerations. It makes no difference if the economy is strong or terrible.
Have other questions about appraisers, appraising or real estate in Tuscaloosa County or Tuscaloosa, AL?Contact Shamrock Appraisals, Inc.
Myth: You can often tell what a property is worth simply by looking at the exterior.
Fact: There are a multitude of different factors that conclude the value of a home; these factors include location, condition, improvements, amenities, and market trends. An external inspection certainly can't provide all of the information necessary.
Myth: Because the consumer is the one who provides the funding to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal report is theirs.
Fact: Unless a lender releases its vestment in the document, it is legally owned by the lending company that ordered the appraisal. By the Equal Credit Opportunity Act, any consumer requesting a copy of the appraisal report must be provided with it by their lending company.
Myth: There's no point for consumers to even care about what the report contains so long as their lender is fine with the contents therein.
Fact: It is very important for home buyers to go through a copy of their report so that they can verify the accuracy of the document, in case there is a need to question its accuracy. Remember, this is probably the most expensive and important investment a consumer will ever make. An appraisal can serve as a record for the future, containing an incredible amount of information - including, but certainly 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: There is no reason to order an appraisal unless you are trying to get an estimate of the value of a house during a sales transaction involving a lending institution.
Fact: Based upon their qualifications and designations, appraisers can and often do perform a variety of services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: There's no need to get an appraisal if you order a home inspection.
Fact: A home inspection has a completely different purpose than an appraisal report. The task of the appraiser is to form an opinion of value in the appraisal process and through producing the report. House inspectors will compose a report that will explain the condition of the property and its major components and possible damage.