Common myths about appraising

By law, an appraiser must be state-licensed to perform appraisals for federally-supported transactions. You have the ability to acquire a copy of the completed appraisal report from your lending agency. Contact our professional staff if you have any questions about the appraisal process.

Myth: The value that is assessed by the appraiser must be equivalent to the market value.

Fact: While most states back the concept that assessed value equates estimated market value, this commonly is not the case. Interior remodeling that the assessor has not investigated and a dearth of reassessment on nearby properties are excellent examples of why the price can vary.

Myth: The buyer or the seller sometimes may have some pull in the cost of the property depending upon for whom the appraiser is working.

Fact: There is no personal interest on the part of the appraiser in the result of the appraisal, therefore he will complete his work with impartiality and independence, regardless for whom the appraisal is written.

Myth: The replacement value of the house will be is on par with the market value.

Fact: Without any pressure from any external parties to purchase or sell, market value is what a willing buyer would pay a willing seller for a particular property. The dollar amount necessary to reconstruct a property is what constitutes the replacement cost.

Myth: Appraisers use a formula, like a certain price per square foot, to arrive at the cost of a home.

Fact: An appraisal report is an amalgamation of information concluded from the home's size, location, proximity to certain facilities, the condition of the house and the value of recent comparable sales. You can count on Kent & Associates Appraisal's staff to be professional in assessing this information.

Myth: In a strong economy - when the worth of homes in a given region are reported to be rising by a certain percentage - the costs of individual homes in the area can be expected to increase by that same percentage.

Fact: All increase of value is on a one-on-one basis, determined by information on relevant elements and the data of comparable houses. This is true in fair economic times as well as bad.

Have other questions about appraisers, appraising or real estate in Snohomish County or Mill Creek, WA?

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

Fact: To conclude an accurate price beyond all doubt, an appraiser must inspect the house on a variety of factors based on location, condition, improvements, amenities, and current market trends. An exterior inspection certainly can't provide all of the information necessary.

Myth: Because consumers pay for appraisal reports when applying for loans to purchase or refinance real estate, they own their appraisal.

Fact: Legally, the document is owned by the lending company unless the lender relinquishes their interest in the document. Home buyers must be supplied with a version of the appraisal report through request as per the Equal Credit Opportunity Act.

Myth: Home buyers need not be concerned with what is in their report so long as it exceeds the necessities of their lending company.

Fact: Only if consumers check out 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 makes an invaluable record for future reference, containing useful 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: The only reason someone would order an appraisal is if a home needs its price assessed in a lender sales transaction.

Fact: Depending upon their qualifications and designations, appraisers can and will provide a multitude of services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.

Myth: A home inspection serves the same purpose as an appraisal.

Fact: Appraisal reports have almost nothing in common with a home inspection. The appraiser forms an opinion of value in the appraisal process and resulting report. A home inspector analyzes the condition of the house and its main components and reports their findings.