A Brief Understanding Of The Home Appraisal Process!

It is often the case that the consumers are befuddled by the home appraisal processes that are carried out by the appraisers as well as the lenders

. According to their own opinion, they have a certain worth of their house in their minds that according to their own opinions is quite perfect. But the opinion of the appraisers is quite different. It is important to note that it is the lenders that decide the appraised amount of the property. Another factor that has to be taken into consideration is the fact that it is the market forces that decide the appraisal of any particular property. For instance if the home owner installs a custom pool that cost him $30,000 and the local marketplace supports the value at $15,000, then the appraised value would only be $15,000.

The main reason behind the home appraisal process being so complicated is the fact that the lenders place a strict restriction on the terms and conditions placed on the appraisal processes of any property. It is important that the home owners as ell as the Seattle first time home buyer,as well as the appraisers understand that they cannot cross the limits that are put on the appraisal of the property depending upon the fair market value on a home based upon the rate of the property in the area.

The process of the pricing of the upgrades depend upon several factors. For instance if the home is a newly built home then the cost that the appraiser as well as the home owner would put on it would be generally accepted by the lenders as the construction of the new home required additional investment on the part of the home-owner. But in case the upgrade is concerned with the remodeling of an older home then it is seldom reflected in full in the final appraisal. The reason being that the similar remodeling done in the area is taken into account in the final appraisal. Generally the comparisons are carried out while keeping in mind the market activity that had been taking place during the last six months. There are safeguards in place that make sure that the appraisers do not play smart and over-value the property. The lenders would make sure that they get to have a look at the closed as well as the pending sales to see whether there is some scope of negotiation with the appraisers. One thing that has to be kept in mind is that there is a stated guideline according to which the appraisers can place a value only on home that have closed escrow.

It is known in the market parlance that generally the lenders give an error leverage of 5% to the appraisers. In case the appraisers cross this limit say by 8%, then the lenders would cut the value by full 8%. It is always advisable to the appraisers as well as the home owners or first time home buyer Seattle, to make sure that they follow the lender guidelines all the time and stay well within the system.

by: Ben Brashen

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