Appraisal myths & facts
Legally, an appraiser needs to be state certified to create legitimate appraisal reports for federally-supported transactions. Also by law, you are entitled to request a copy of the completed report from your lender. Contact our professional staff if you have any concerns about the appraisal process.
Myth: Market value will be similar to the assessed value of the property.
Fact: While most states back the concept that assessed value approximates estimated market value, this commonly is not the case. At times when interior remodeling has been done and the assessor is has not investigated the improvement or properties in the area have not been reassessed for years or more, it may vary wildly.
Myth: The appraised value of a home will change depending upon if the appraisal is ordered for the buyer or the seller.
Fact: There is no real interest on the part of the appraiser in the result of the report, therefore he will conduct his work with impartiality and independence, despite for whom the appraisal is conducted.
Myth: The replacement cost of the property will be is on par with the market value.
Fact: Without any influence from any outside parties to purchase or sell, market value is what a willing buyer would pay an interested seller for a specific home. Replacement cost is the dollar amount needed to reconstruct a home in-kind.
Myth: Appraisers use a formula, such as a certain price per square foot, to come to the cost of a home.
Fact: An appraisal report is a collection of data based on the house's size, location, proximity to certain facilities, the condition of the home and the price of recent comparable sales. You can count on A & B Tax Service's staff to be ethical in assessing this information.
Myth: When the economy is doing well and the worth of homes are found to be appreciating by a certain percentage, the other houses in the neighborhood can be expected to rise based on that same percentage.
Fact: Worth increase of a specific property is always determined on a case-by-case basis, factoring in information on comparable homes and other relevant considerations. This is true in strong economic times as well as poor.
Have other questions about appraisers, appraising or real estate in Racine County or Sturtevant, WI?Contact us
Myth: You can commonly tell what a house is worth simply by looking at the exterior.
Fact: There are a multitude of different variables that show the value of a home; these factors include location, condition, improvements, amenities, and market trends. There's no real way to get all of this information from simply viewing the property from the outside.
Myth: Because consumers fund appraisal reports when applying for loans to purchase or refinance their property, they own their appraisal report.
Fact: Unless a lender releases its interest in the report, it is legally owned by the lending company that ordered the appraisal. Consumers must be given a copy of the appraisal report upon written request due to the Equal Credit Opportunity Act.
Myth: It doesn't mean anything to consumers what's in the appraisal report so long as it satisfies the necessities of their lending agency.
Fact: It is very important for home buyers to check over a copy of their appraisal so that they can verify the accuracy of the report, in case it's required to question its accuracy. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the appraisal makes an invaluable record for future reference, filled with helpful and often-revealing data - including 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 assessment of the price of a home during a sales transaction involving a lending company.
Fact: Hiring an appraiser can fulfill a variety of necessities depending on the designations and certifications of the appraiser involved; appraisers can perform a great deal of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: A house inspection serves the same purpose as an appraisal.
Fact: An appraisal does not serve the same purpose as an inspection. The reason behind an appraisal report is to arrive at an opinion of fair market value during the appraisal process and the production of the appraisal. House inspectors will produce a report that will express the condition of the property and its major components and possible damage.