Appraisal
The purchase of real estate can be the largest single investment in a person’s life. An investment, not only in terms of money, but also their time and energy!
Whether its your first home or you are a seasoned commercial property owner, the only way to make sure that you are not overspending or under selling is to engage the services of a Licensed or Certified Real Property Appraiser.
If you are financing the purchase of real property, your lender will most likely require an appraisal, to be sure that the value of the property being financed is commensurate with the amount being lent. The bottom line is that lender’s want to be sure that they are able to recover any losses, in the unlikely event that the borrower is unable to make their payments.
When a lender engages an appraiser, the lender is the appraiser’s client and the appraiser is obligated to maintain the confidentiality of the appraisal report and findings. Many buyers mistakenly assume that since they are paying for the appraisal, the appraiser is obligated to share a copy of the appraisal and discuss it with them. This is not the case, however at Clear Title & Appraisal Co. we will work with our lender partners to ensure that our appraisers have the proper authorization needed to be able to discuss their findings with you.
At Clear Title & Appraisal Co., we are a full service appraisal firm and appraisal management company. Our service area includes the entire State of Texas.
Understanding the Appraisal
Understanding the Appraisal Much of the private, corporate and public wealth of the world consists of real estate. The magnitude of this fundamental resource creates a need for informed appraisals to support decisions pertaining to the use and disposition of real estate and the rights inherent in ownership. An appraisal answers one or more specific questions about a real estate parcel’s value, marketability, usefulness or suitability.
The Appraisal Defined
Professional real estate appraisers perform a useful function in society and offer a variety of services to their clients. They develop opinions of several types of property value and assist in various decisions about real estate. Standards for the appraisal profession are set forth in the Uniform Standards of Professional Appraisal Practice (USPAP) developed by the Appraisal Standards Board of The Appraisal Foundation.* USPAP specifies the procedures to be followed in developing and communicating an appraisal and the ethical rules for appraisal practice. As defined in USPAP, an appraisal is the act or process of developing an opinion of value. The valuation process is a systematic procedure the appraiser follows to answer a client’s question about real property value. The most common type of appraisal assignment is the development of an opinion of market value. However, because of their specialized training and experience, appraisers can provide a wide range of additional appraisal services—from investment consultation to advice on various business as well as personal financial decisions
Things to Know About Home Appraisals
When calling in a professional appraiser, here is what you must keep in mind to avoid confusion:
From Seller’s Perspective
Unfortunately, if your neighborhood has encountered distresses sales, your appraisal values will go down. As a seller, if your home’s appraisal value is low yet accurate, you will have to reduce the property’s price to get it marketed. However, you can convince the appraiser that your home may be worth more regardless of the neighboring foreclosures and short sales. But remember, no one wants to pay over fair market price, so you must stay cautious.
From Homebuyer’s Perspective
An appraisal is usually the first step of closing. If you are under contract and the estimated value comes at or above the contract price, your transaction will proceed as per the plans. However, the home buying procedures derail if the appraisal value is lower than the contract price. In such a situation, none of the parties would want the transaction to fall through. But in a lower appraisal, you as a buyer can have the upper hand with negotiation since lenders would certainly not grant anything above what the home is worth. Sellers may be reluctant to the price drop. But with professional and accurate appraisals, buyers get to avoid overpaying. Besides, you can always request a second appraisal if you feel a bad estimate may be stagnating the purchase. Appraisers, too, can make mistakes or be affected by bias. It is your responsibility to put forward a fair appraisal value – not too low, not inflated.
From Refinancing Homeowner’s Perspective
When looking to refi your mortgage, a lower appraisal will only hinder your chances of approval. Remember, the home needs to appraise above the amount you want to refi your loan for. However, if it is an FHA loan, those don’t require an appraisal, and instead, streamline the process with FHA-specific programs.
From Seller’s Perspective
Unfortunately, if your neighborhood has encountered distresses sales, your appraisal values will go down. As a seller, if your home’s appraisal value is low yet accurate, you will have to reduce the property’s price to get it marketed. However, you can convince the appraiser that your home may be worth more regardless of the neighboring foreclosures and short sales. But remember, no one wants to pay over fair market price, so you must stay cautious.
From Homebuyer’s Perspective
An appraisal is usually the first step of closing. If you are under contract and the estimated value comes at or above the contract price, your transaction will proceed as per the plans. However, the home buying procedures derail if the appraisal value is lower than the contract price. In such a situation, none of the parties would want the transaction to fall through. But in a lower appraisal, you as a buyer can have the upper hand with negotiation since lenders would certainly not grant anything above what the home is worth. Sellers may be reluctant to the price drop. But with professional and accurate appraisals, buyers get to avoid overpaying. Besides, you can always request a second appraisal if you feel a bad estimate may be stagnating the purchase. Appraisers, too, can make mistakes or be affected by bias. It is your responsibility to put forward a fair appraisal value – not too low, not inflated.
From Refinancing Homeowner’s Perspective
When looking to refi your mortgage, a lower appraisal will only hinder your chances of approval. Remember, the home needs to appraise above the amount you want to refi your loan for. However, if it is an FHA loan, those don’t require an appraisal, and instead, streamline the process with FHA-specific programs.
How Long Does An Appraisal Take?
On average, the appraisal process can take around a week to over ten days. The appraiser visits the property, spends a few hours inspecting all interiors and exteriors and all features and measurements. They also make neighborhood comparisons, after which they write the report. The process is lengthy and complex, and the appraiser’s schedule will also determine when you can expect the final say.
Apart from appraisal time, here is a bonus tip on appraisal costs – This depends on the property’s location, condition, and size. Charging on a percentage basis is unethical. However, a flat fee or hourly charges may be practiced by most. Someone expert with their job will also take much less time to get the appraisal completed.
The Bottom Line
When all else falls in place, a home appraisal is just another box to check off on the list. If the assessed value is lower than expected, the process might delay or terminate. However, regardless of the situation, understanding the specifics always works in your favor, and partnering with a professional is the safest bet for your buying, selling, and refinancing experience.
Contact Us Today for a Home Appraisal in Texas
The Clear Title & Appraisal Company team is committed to a dependable and consistent home appraisal when you are in the midst of your home closing process. We stand behind our work and focus solely on providing fast, affordable, and accurate valuations for the Texas home market. Another certified appraiser reviews all appraisals, so you can be double sure there are no mistakes. Our reports are guaranteed, and we also explain how we determine the appraised values.
Schedule an appraisal today. Call us at (214) 782-9860, and we will immediately have someone respond to your request with the right solutions.
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