The Appraisal Process Explained
Finally you’ve got a buyer! They love your home and want to buy it. But it’s not over yet. The process is just starting and one thing that is required is an appraisal. I’ll explain the who, what, when, where and why of appraisals for you.
Why: When you sell your house the buyer is going to get a new loan to purchase the property, the buyer’s lender requires a licensed appraiser to estimate the market value of the property to who the lender that they are making a good decision to lend the buyer the money to buy the house.
When: Once the buyer begins the new loan application process the lender will order the appraisal. To get a good estimate of the market value of your house, the appraiser will research the houses sold in your subdivision or immediate area. Appraisers prefer to use homes sales occurring within the past 6 months and are similar to yours in square footage, year built and amenities (swimming pool, garage size, single story etc).
Who & How: The appraiser will measure you house, take pictures, examine your house for it’s condition, specific improvements and amenities. You can help the appraiser by preparing a list of recent improvements and remodeling that has been done and include approximate amounts spent for each improvement. Some appraisers will appreciate this information and some may not. But if you already had the information prepared for buyers looking at your home, then providing it for the appraiser will be simple.
You: If the buyer of your house is getting an FHA or VA loan, there will be a few special requirements places on your house. You scrape and paint all chipping or peeling paint on your house or any structures on the property. You should also replace any missing or damages shingles and missing slats or blocks in your fence.
The lender will get a copy of the appraisal a few days after the appraiser has been to your home. You may be told that the appraiser has some repair requirements before the lender can loan the buyer any money on your house. If that happens, you will have to repair those problems and the appraiser will come back for a re-inspection for an additional cost.
The Bottom Line Is This: if your house doesn’t appraise for the sales price, the buyer can legally walk away from the deal. It is very, very super important that you price your home correctly.
By the way, if you'd like to discuss how you can take advantage of all the great opportunities in this market feel free to call (480) 430-9761or click here and let's talk.