In general, the appraisals are associated with the purchase of a house, although they also have other purposes. For example, the bank or the mortgage company will almost always need to price your home if you want to refinance it. In some cases, particularly those who are considering selling their house in the near future, they can request an appraisal just to get an idea of the value of the house. Most of the time, the bank or the company that grants the mortgage will be those who will provide their own appraiser although, on occasion, it may be permissible for you to choose one yourself. In any case, you must follow certain steps to be certain that the appraisal is accurate and that the process goes smoothly.
Get an appraiser
Get in touch with the local agency that issues appraiser licenses. In most places, appraisers must have some type of license or certification to be able to make appraisals for lenders that are regulated by the government.
Get a qualified appraiser in the place where you live. For this, an option is through reliable online resources. For example, if you live in the USA.
Ask for a recommendation to your bank, real estate agent or Mortgage Company. In case you want to carry out the appraisal for a refinancing or a mortgage loan, you should be able to obtain from your lender the names of the appraisers with whom you usually work. In case you intend to sell your house, usually a local real estate agent will be happy to recommend some appraisers.
- Ask your lender to send you a local appraiser. In case you go to work with a bank or a mortgage company and you are not allowed to get the appraiser yourself, be careful to ask the lender that the appraiser who sends you is well acquainted with your neighborhood.
- You should bear in mind that, depending on where you live, there may be laws that specify how you should contact the appraisers and who can do it.
Prepare for the appraisal
Know what the appraiser will look for. The appraisers take into consideration various aspects when performing their appraisal inspection, among which are the following:
- The ubication
- The conditions of the exterior and the interior
- The total number of rooms
- Functionality, including the design and layout of the interior rooms
- The improvements in the bathrooms and kitchens, the windows, the roof and the systems of the house (heating, electricity, and plumbing)
- The condition and age of the systems of the house
- Exterior elements, such as garages, platforms, and porches
Consider what is the reason you are going to perform the appraisal. Your reasons for carrying out an appraisal at the beginning will determine what you expect to obtain from it. Regardless of what your reasons are, it is key that you get an experienced appraiser and know your neighborhood. Below you will find some cases and what you should look for in each one:
- Refinancing a mortgage or obtaining a mortgage loan or line of credit. In this situation, it is necessary that you obtain the highest possible valuation. You should inform the appraiser if you know about a recent sale of a property that is similar to yours and is prepared to tell you if you consider that your house could be worth more than the others and your reasons for doing so.
- The dispute over a tax evaluation. In this case, it is better than the appraisal be as low as possible. In case your neighbors’ homes are comparable to yours, you should find out how much they pay in taxes. To do this, you could ask them or look for it online, as well as check the records of the local tax assessor’s office. If your neighbors pay less than you, you must tell the appraiser.
- The sale of your house It is evident that, in this case, you will want the appraisal to be high. Again, if your home has improvements or items that did not have some of the similar homes recently sold in your neighborhood, you should tell the appraiser about it.
Gather documents that could be helpful to the appraiser. They will appreciate anything that facilitates their work, so you should try to have at hand some paperwork that is useful to them, such as the following:
- a map or map of the land and the house
- the most recent property tax bill or a legal description of the property
- reports of house inspections or other recent and more specific inspection reports (such as inspections for termites, septic systems, and wells)
- a title policy describing the invasions or usufructs (it is likely that you obtained a copy when buying the house)
Search for comparable properties. There are websites Ali and co where you can find information about recent sale prices for homes in your neighborhood that are similar to yours. As mentioned above, it might be helpful to have this information at hand for the appraiser so that you can at least get an idea of what the current price is in your neighborhood. The physical characteristics of a house should be similar to yours so that it can be considered as “comparable”. This covers aspects such as the following:
- the number of square meters
- the number of rooms and bathrooms
- the plane of the plants
- the antiquity
Make a complete list of the improvements you have made to your home. While all help, what can really make a difference are costly upgrades, such as a new roof, boiler or water heater. You must be careful to also include the new appliances that you are going to sell along with the house.
Take measures to maximize the appraisal. With a little money and work, you can make a big difference in making sure your home gets the highest appraisal. Nothing adorns the appearance of a house as a new layer of paint inside and out. Neither should you ignore problems that you might consider minor (for example, leaks in taps or the absence of doorknobs), as these could make a bad impression.
Handle the day of the appraisal
Clean the house. Although the appraiser will not buy your house, this does not mean that appearances are not important. Therefore, you must get rid of the clutter inside, wash the breakfast dishes, eliminate household odors and be careful to mow the lawn.
Make sure it is easy to access all parts of your house. Keep in mind that the appraiser will enter all the rooms of your house, even the attic or the roof, so the last thing you need is to have to move through an obstacle course.
Be careful that the appraiser feels as comfortable as possible. The temperature of the house should remain at a moderate level. While 30 ° C (85 ° F) may seem comfortable, the appraiser may not feel the same. Also, pets must be kept locked or out of the house while the appraiser is there, as well as you must do your best so that the children do not cause major interruptions.
Avoid being on the road. While you may feel inclined to follow the appraiser everywhere, you should not do so, since, for the most part, they prefer to be left alone to do their job. You just have to make sure you are at your disposal in case you have to ask any questions.
Dispute a low valuation
It provides new comparable properties. While there is very little chance of having an appraiser changes his mind after completing the appraisal, it is worthwhile to show him an updated list of comparable properties. You will have the best chance if you show comparable properties that have been sold after the date of your appraisal.
It determines if the appraisal took into consideration the wrong comparable properties or if some are missing. You must review the appraisal to determine what comparable properties the appraiser has considered.
- In case you have not considered the local sale of a house that is similar to yours and whose sale price has been higher than your appraisal, you must point it out to the appraiser or to your bank or mortgage company.
- Similarly, in the event that the appraiser has considered the sale of a foreclosed property (for example, a foreclosure, which is mandatory for appraisers to take into account if they predominate in the neighborhood), it is possible that the price of sale has not been the true value of the house, so you must also mention it.
Determine if the houses considered in the appraisal are within the same school district. The latter can make a big difference in the value of a house. For example, if you live in a good school district and one or more of the comparable properties listed in the appraisal is in a less attractive district, the appraisal may not be accurate.
Request a second appraisal. In case you consider that the appraisal of your house is really wrong, you can ask the lender to request another appraisal. While this does not guarantee that you will succeed, you definitely do not lose anything by trying.
Ask for an appraisal yourself. If all else fails, you can get you an appraiser and get a new appraisal. However, you should bear in mind that this will cost you more money and that possibly the new valuation will be the same as the previous one. Also, you are not guaranteed that the bank or the mortgage company change their mind. However, again, whoever does not risk does not win.
- Depending on where you live, the pricing of a standard single-family home will cost you around $ 300 to $ 500.
- Keep in mind that, in the case of a first mortgage, you may have the right to obtain a free copy of the appraisal of your home (depending on where you live).
- Do not forget that an appraisal is not the same as an inspection of your house. The latter is usually carried out on behalf of a buyer and focuses on the details of the state of the house. On the other hand, the appraisal is what establishes the market value of the house.