My brother has his some hard times lately and is thinking about filing for bankruptcy. My husband and I are wanting to buy a home and are needing to get ours appraised. Thanks for helping me learn about the different functions of residential property appraisal. I never knew that it has many uses. Apparently, my sister is planning to purchase a home she found in a listing. Your email address will not be published.
Are You Human? Home Appraisals, Inc. Responsive Web Design by Yeah Can. Looking For Information Call Us Reasons For Getting A Home Appraisal Nov 12, Published by Joseph Castaneda 3 Comments Most people think that the only reason to get a home appraisal is because they are refinancing or financing a purchase of a home.
Here are some examples where an appraisal may come in handy: Selling or Buying Without Financing : This is one of the most common requests. Divorce This is also a very common request. Homeowners considering putting their house on the market can have a pre-listing appraisal conducted to get a better sense of the market value of the home. Doing so can help determine a realistic asking price, increasing the likelihood of a fast sale.
For that reason, lenders will require an appraisal to ensure the new mortgage amount can be justified by what the house is worth today. However, if it has declined, you may have difficulty securing a new loan.
Unlike refinancing, home equity loans are a second loan on top of the existing mortgage. The amount you can borrow in a home equity loan is based largely on the amount of equity you have after the remaining value of the mortgage is subtracted from the current value of the house.
If your home has decreased in value, you may not be eligible for a home equity loan. Other types of loans, including cash and business loans, may require you to use your home as a source of collateral. As with home equity loans, the bank will want to make sure the money it lends is supported by the current value of your property. In many states, property taxes are calculated based on the fair market value of your home. If the value of your home listed on your property tax bill appears too high—if housing prices in your neighborhood or city have declined, for example—you may be able to appeal the assessment.
For example, appraisals are prepared for: Mortgage lending purposes Tax assessments and appeals of assessments Negotiation between buyers and sellers Government acquisition of private property for public use Business mergers or dissolutions Lease negotiations What is the Role of the Appraiser? Pop up content here. The choice is with the lender. That means you pay your closing costs out of pocket and improving on your mortgage terms without increasing the balance. Lenders are most likely to require an appraisal when your loan-to-value exceeds 80 percent or when you apply for a cash-out refinance.
They are least likely to require one when you have a lot of equity or do a streamlined refinance, which means refinancing with the same program and mortgage insurance.
But, of course, that average is drawn from a broad range. Related: Can I get a new appraisal to remove mortgage insurance? However, if you require a particularly detailed report on an exceptionally large home with unusually complex valuation issues, you could easily end up paying four figures. Before the financial crash of , many appraisers felt pressure to inflate their valuations. Subsequent state and federal legislation sought to put an end to that.
Related: How reliable are online home value estimators? For example, the laws specifically permit a party to the transaction requesting an appraiser to correct errors in an appraisal report and to provide additional clarification or explanation for information in an appraisal report. The National Association of Realtors recommends that agents and sellers should prepare a package of documents and make it available to appraisers when they arrive for the inspection.
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