You are about to purchase a new house or refinance the one you are in. There are many steps you have to take, one of which is an appraisal. An appraisal is different from an inspection because it looks at how the aspects of your home affect the value instead of what needs to be fixed before you buy it. Here are a few things the people who take appraisal license courses are looking for.
Compared To the Rest
The first thing your appraiser will do is pull up values of the houses around you. If there have been any houses sold around you in the last few months, they will compare those sale prices also. They will take the basic information about your property and see how it falls in line with the rest. They will also find out how your square footage, size of the lot you live on, and amenities such as a garage compare with your neighbors. Houses on your block that have been foreclosed on or have messy yards and other issues can hurt the evaluation on your place.
Change For Improvement
Another item the appraiser will take into account is any work you have put in on your place. If you have replaced the roof or furnace, the appraiser will factor that into their estimate. Simple things, such as keeping up with your landscaping, can add value to your property. The appraiser will also be looking for any damage that should be accounted for. He or she will search for cracked plaster or tiles, missing shingles or chipping paint. These types of things can bring the numbers they will turn into the bank down. If you are planning on refinancing your home, it is vital that you make these repairs before you schedule an appointment to have someone evaluate it.
Why Get an Appraisal?
Most banks require an appraisal when they finance a property. Most of the time, the financial institution will ask that you pay for the report. They need to know how much they can list the house on the market for in the event you stop making payments. Some will just do a drive by to accumulate their numbers while others will insist that they make an appointment with you to see the inside. This estimate can determine if you need will need to lower the price you are asking or if you can keep it where it is.