Why Hire an Appraiser?
What are the benefits?
Think of an appraisal as an investment for your future. It is imperative to know what your property is worth, so that you can make a sound, educated financial decision.
When you’re considering buying a house, there are two sides to the story: the seller’s asking price and the actual value of the property. This is where an appraiser steps in.
- The real estate appraiser may be hired by a seller to determine an accurate selling price or by the buyer to ensure the accuracy of the purchase price
- As a seller, hiring an independent and objective real estate appraiser to ensure that money is not being left on the table
- As a buyer, having the confidence of knowing that a good financial decision is being made based upon an independent and objective appraisal, with no connection to anyone within the real estate transaction, is priceless.
What is the job of an appraiser?
An appraiser’s job is to determine the current value of a property. Only a portion of the process is done on-site where the appraiser will:
- Exterior measurements and photos will be taken of the home as well as any out buildings.
- Walk the length of the property to determine exterior condition.
- Evaluate all amenities such as out buildings, swimming pool, finished area above garages
- Conduct a room-by-room walk-through to determine interior condition, taking interior photos and noting features of the home that will influence the value.
- Note any health or safety issues.
- Record the layout of the property.
- Off-site, the appraiser will also evaluate the current real estate market in the neighborhood to help determine the value of the property.
How do you know if an appraiser is qualified?
A qualified Real Estate Appraiser should be state-licensed or state-certified as they are governed by USPAP. The Uniform Standards of Professional Appraisal Practice is the generally recognized ethical and performance standards for the appraisal profession in the United States. Compliance is required for state-licensed and state-certified appraisers involved in federally-related real estate transactions. USPAP is updated every two years so that appraisers have the information they need to deliver unbiased and thoughtful opinions of value.
Who hires the appraiser?
For an independent opinion of value for a residential property that is not associated with a financial institution, you personally would be responsible for the hiring and payment of the appraisal.
If you are working with a financial institution, your lender will choose the appraiser. The lender will have a list of reputable appraisers whom they have hired in the past. Typically, a financial institution will NOT accept an outside appraisal, so make sure to understand the process before you explore hiring an independent appraiser.
The loan agreement normally contains a set value for the appraisal of property. The loan applicant typically pays for the appraisal as part of the closing costs, unless the contract specifies otherwise. If a seller is motivated, he may pay for the appraisal himself to back his asking price, which may benefits the buyer by reducing closing costs. Expect an average range of $400 – $500 depending on the complexity of the assignment.
How long does it take?
One hour is the average time spent at the property as most of the work is completed out in the field and back at the appraiser’s office. Most likely, the appraisal should be delivered within three to seven business days after the observation. The amount of time it takes to complete the appraisal report will depend on the size of property and complexity of the process.
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