Appraisal myths debunked

Legally, an appraiser has to be state certified to perform substantiated real estate appraisals for federally-backed transactions. The law allows you to receive a copy of your finished report from your lender after it has been provided. Contact us if you have any concerns about the appraisal process.

Myth: Assessed value should equate to market value.

Fact: It could be that California, like most states, supports the suggestion that the assessed value equals the market value; however, this is sometimes the exception rather than the rule. Examples include when interior remodeling has happened and the assessor is unaware of the improvements, or when properties in the vicinity have not been reassessed for an extended period.

Myth: Depending on if the appraisal is drawn up for the buyer or the seller, the value of the property will vary.

Fact: The opinion of value of the home does not affect the salary of the appraiser; due to this, the appraiser has no personal interest in the worth of the property. This means that he will render task with impartiality and objectivity regardless for whom the appraisal is created.

Myth: The replacement cost of the home 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. If the home were reconstructed, the dollar amount needed to do so would make up the replacement cost.

Myth: There are specific methods that real estate appraisers use to show the opinion of value of a property, such as the price per square foot.

Fact: An appraisal report is an amalgamation of information concluded from the property's size, location, proximity to certain facilities, the condition of the home and the value of recent comparable sales. You can rely on JOSEPH P BALDINO's staff to be forthright in assessing this information.

Myth: As houses appreciate by a certain percentage - in a robust economy - the houses nearby are expected to appreciate by the same amount.

Fact: Worth appreciation of a certain home is always concluded on a case-by-case basis, factoring in data on comparable homes and other relevant elements. It doesn't matter if the economy is on the rise or declining.

Myth: The house's outside is determinate of the actual price of the home; there is no need to do an interior appraisal.

Fact: To determine an accurate value beyond all doubt, an appraiser must assess the home on a variety of factors based on area, condition, improvements, amenities, and current market trends. There's no possible way to get all of this data from simply viewing the house from the outside.

Myth: Because consumers pay for appraisals when applying for loans to purchase or refinance their home, they own their appraisal.

Fact: The document is, in fact, legally owned by the lending company - unless the lender "relinquishes its interest" in the appraisal. However, home buyers must be given a copy of the document upon written request, through the Equal Credit Opportunity Act.

Myth: It doesn't mean anything to consumers what's in the appraisal so long as it meets the requirements of their lending agency.

Fact: Only if home buyers examine a copy of their 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. Also, the appraisal report makes a near perfect 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 vicinity.