What is a Home Appraisal?
You’ve decided to sell your home at a price both you and the buyer have agreed upon. Your home has passed inspection with no problems and you’ve signed the purchase and sale agreement. But wait, you’re not free and clear yet! The next step is the home appraisal.
Most buyers need to get a bank loan to purchase a home. The bank will require the buyer to pay for a bank appraisal for the bank’s interest in the home. The home is an asset that serves as collateral for the bank loan. So, if for some reason the buyer cannot pay the mortgage and the home goes into foreclosure, the bank would need to sell the home to repay the loan. The bank will only approve a loan on the home if it appraises for the full sales price of the home or more. For this reason, the bank appraiser will come out to the home and try to validate the price that was agreed upon by the buyer and seller.
What is the Process of a Home Appraisal?
1. A licensed home appraiser comes out to the home to inspect and take measurements, photos, and an inventory of updates.
2. The home appraiser will complete a statistical review of the area to see if he can find a validation for the sales price that was agreed upon. He’ll research similar homes in the area and compare recent sales to determine market value.
3. The home appraiser will use all the data gathered to issue a final appraisal report with all the data and research to issue an opinion of value.
Remember, an appraisal is just another person’s opinion of value, it’s not necessarily black and white or fact. It’s one part scientific and statistical and another part objective based upon the bank appraisers experience.
If you’d like to learn more about how we help our sellers pick the right price that makes it through appraisals most often, give us a call at 978-494-0346.
