As the events of the last few years in the real estate industry show, people forget about the tremendous financial responsibility of purchasing a home at their peril. Here are a few tips for dealing
Understanding The Appraisal Process
Now that you’ve received and agreed to the terms of your offer, you need to assure that the loan process goes smoothly and you are able to close your escrow on time.
Often time’s things can go amiss and one of the common “things” seems to be the appraisal.
I am going to give you some input as to how to effect the appraisal positively.
By definition an appraisal is a valuation of the property you wish to sell. If a lender is involved in the purchase they generally require one. They want to safeguard their percentage of the investment to make sure the property is worth as much as it fits within their lending guidelines.
A third party, independent of the buyer and lender conducts the appraisal. By law this person can have no financial share in the result of the appraisal. The mortgage company usually hires an appraisal management company, who in turn, will hire a local appraiser who is familiar with similar sales in the area of your home. The buyer is responsible for paying for the appraisal.
Appraisals are very detailed reports. Most include the following:
Comparisons of other homes in the area that have sold within a six-month period.
Details about the property.
The area in which the home is located and how that affects the value.
Any unfavorable aspects of the property; such as foundation issues and general deterioration.
Length of time it took for the home to sell.
The last thing that anyone on either side of the transaction wants is for the deal to fall through due to a low appraisal. As the seller you can assist by paying attention to some key issues.
Make sure that your house is cleaned up and tidy on the day of the appraisal. Mow the grass and trim the outside, making sure to gather up any debris from the yard. Keep a list of any updates you have done to the home. Even though you may not be able to change the area you live in, make sure the appraiser knows of any new improvements such as a new grocery store that just came in.
Make sure you pay attention to the comparisons providing by your listing real estate agent when listing and selling your home. These will affect the appraisal of your property when that time comes.
Selling a home can be a stressful situation. But doing your homework ahead of time and having realistic expectations can make this part of the process fairly streamlined and stress free with no last minute surprises.
Sam Lepore is a Realtor with Keller Williams in Moorestown, NJ. Call him today at 856.297.6827 ....