What is a home appraisal?
Getting your home appraised is a crucial step in buying and selling a home. Learn what a home appraisal is and how they work with the breakdown below.
A home appraisal is an estimate of how much a piece of property is worth. Regardless of whether you’re selling or buying a house, getting your home appraised is an important step. It sets a standard for how much you should sell your house for or tells your potential lender the value of the home before offering you a mortgage loan.
How do appraisals work?
The home appraisal process is straightforward and involves ordering a licensed appraiser to estimate the cost of the home through a comprehensive examination. Normally, the professional appraiser needs to be scheduled a few days in advance. The duration of the inspection can range from 15 minutes to a few hours depending on the condition of the home.
If it’s a homeowner who wants to know the value of the home before listing the property, then the homeowner directly contacts the appraiser. In this case, the seller pays for the home appraisal. If a homebuyer wants to purchase a home and is seeking a mortgage loan, then the lender orders the appraisal. With the latter, the appraisal cost is included within the Closing Disclosure and becomes a part of your closing costs.
After the thorough examination, the appraiser assesses the real estate market in the area for comparison. And an appraisal report is delivered to the homeowner or lender up to a week later.
How much do home appraisals costs?
House appraisals typically cost roughly $400 – $650, depending on what is needed in the report.
What do appraisers examine?
Appraisers differ from home inspectors in what they analyze. Inspectors only conclude problem areas in the home that may need repair. Beyond the condition of the home, home appraisers look at the location of the house and other features that may add value. Recent homes sold in the neighborhood and additional items like swimming pools and renovated kitchens are taken into account.
When You’re Thinking About Selling
Although real estate agents usually provide a no-cost market analysis to help price your home to sell quickly for the best value, a certified real estate appraiser can help you determine a level at which a lender will loan a buyer. This is particularly useful if you don’t want to put effort into staging your home and have people walking through if you’re not sure whether proceeds from selling will meet your needs or if you should wait for the market to rise a bit longer.
When Life Takes a Turn
Changing life circumstances can bring about the need to determine your home’s value quickly. If you’re taking out a business loan, you might have to provide a certified value for your house if it’s used for collateral. Less happily, there’s also need for an accurate and timely appraisal when filing bankruptcy, dividing up property in a divorce or settling an estate. A complete interior and exterior appraisal will cost significantly more than an appraisal based solely on the outside condition and neighborhood property values, but can pinpoint the home’s worth when taking interior upgrades into account.
Home appraisal tips for sellers
To get the most out of your home, there are a few things you can do to prep for the appraisal. The purpose of the home appraisal is to see the worth of your home, so the better maintained your property is, the higher the value. Overall cleanliness is important for selling your home as well. Signs of pests, unkempt landscaping, chipped paint and cracked windows are areas you can inexpensively fix before an appraiser visits.
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