Common myths about appraising
Legally, a real estate appraiser must be state certified to create substantiated appraisal reports for federally related transactions. You can demand a copy of the completed report from your lending agency. Contact Fortiz Appraisal Services if you have any concerns about the appraisal procedure.
Myth: The value that is assessed by the appraiser will be the same as the market value.
Fact: It is possible that Texas, like most states, validates the idea that the assessed value is no different from the market value; however, this is not often the case. Examples include when interior reconstruction has happened and the assessor is unaware of the improvements, or when homes in the area have not been reassessed for a prolonged period.
Myth: The appraised value of a home will differ depending upon whether the appraisal is produced for the buyer or the seller.
Fact: The cost of the home does not affect the payment of the appraiser; as a result, the appraiser has no personal interest in the opinion of value of the property. This means that he will conduct services with impartiality and objectivity regardless of whom the appraisal is provided.
Myth: Any time market value is found, it should be similar to the replacement cost of the home.
Fact: The way market value is found is based on what a home buyer would be willing to pay a willing seller for a home without being under influence from any outside party to purchase or sell. The dollar amount needed to reconstruct a home is what shows the replacement cost.
Myth: There are certain methods that appraisers use to determine the opinion of value of a property, such as the price per square foot.
Fact: There are many varied ways that an appraiser will use to make a full analysis of every factor in consideration of the home, such as the size, location, condition, how close it is to undesirable facilities and the value of recently sold comparable properties.
Myth: As properties appreciate by a specific percentage - in a robust economy - the homes in proximity are figured to increase by the same amount.
Fact: Value increase of a certain property must be determined on an individualized basis, factoring in information on comparable properties and other relevant considerations. It doesn't matter if the economy is doing well or declining.
Myth: You can often see what a house is worth simply by looking at the exterior.
Fact: Home worth is concluded by a multitude of variables, including area, condition, improvements, amenities, and market trends. An outside-only inspection certainly can't provide all the data required.
Myth: Because consumers pay for the appraisal when applying for loans to purchase or refinance their house, they own their appraisal.
Fact: The appraisal is, in fact, legally owned by the lending company - unless the lender "releases its interest" in the appraisal report. However, home buyers must be supplied with a copy of the appraisal report upon written request, in accordance with the Equal Credit Opportunity Act.
Myth: There's no point for consumers to even care about what the appraisal contains so long as their lender is satisfied.
Fact: Only if home buyers look over a copy of their appraisal report can they verify its accuracy and possibly need to question the result. Remember, this is probably the most expensive and important investment a consumer will ever make. There is a great deal of information contained in an appraisal report that will probably be useful to the consumer in the future, such as 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 region.
Myth: There is no reason to hire an appraiser unless you are trying to get an assessment of the worth of a home during a sales transaction involving a lending company.
Fact: Hiring an appraiser can fulfill a variety of wants depending on the designations and certifications of the appraiser involved; appraisers can provide a great deal of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: There's no reason to get an appraisal if you order a home inspection.
Fact: A home inspection report has a completely different purpose than an appraisal report. An appraiser finds an opinion of value in the appraisal process and resulting appraisal. A home inspector analyzes the condition of the home and its main components and reports these findings.