Appraisal myths debunked

By law, an appraiser is enforced to be state-licensed to produce appraisals for federally-related purchases. The law allows you to receive a copy of your completed appraisal from your lending agency after it has been produced. Contact our professional staff if you have any concerns about the appraisal procedure.

Myth: The value that is ascertained by the appraiser is required to be exactly the same as the market value.

Fact: This usually isn't true; most states do support the idea that the assessed value is the same as market value, but not always. Generally when interior remodeling has been done and the assessor is has not investigated the improvement or properties in the Palmer have not been reassessed for years or more, it may vary wildly.

Myth: The buyer or the seller may have some pull in the cost of the property depending upon for whom the appraiser is working.

Fact: The price of the house does not affect the salary of the appraiser; as a result, the appraiser has no preconceived interest in the cost of the home. Obviously, he will provide job with impartiality and independence regardless for whom the appraisal is provided.

Myth: Market value should equal replacement cost.

Fact: Market value is arrived at through what a willing buyer would be interested in paying a willing seller for a specific property, with neither being under duress to buy or sell. Replacement value is the dollar amount needed to rebuild a home in-kind.

Myth: Appraisers use a calculation, like a certain price per square foot, to arrive at the cost of a property.

Fact: Appraisers make an exhaustive analysis of all factors in consideration to the value of a property, including its location, condition, size, proximity to facilities and recent costs of comparable properties.

Myth: In a strong economy - when the sales prices of properties in a given area are reported to be appreciating by a particular percentage - the values of individual houses in the area can be expected to increase by that same percentage.

Fact: Any price at which an appraiser arrives in regards to a particular home is always individualized, based on certain factors derived from the information of comparable properties and other specifications within the property itself. It makes no difference whether the economy is powerful or on the decline.

Have other questions about appraisers, appraising or real estate in Matanuska Susitna Borough or Palmer, AK?

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Myth: Just seeing what the home looks like on its exterior gives an idea of its worth.

Fact: There are a multitude of different variables that show property value; these factors include area, condition, improvements, amenities, and market trends. There's no possible way to get all of this information from simply viewing the house from the outside.

Myth: Since you're the one coughing up the cash for the appraisal report when applying for your loan to buy or refinance your home, you own the provided appraisal.

Fact: Unless a lender releases its interest in the report, it is legally owned by the lending agency that purchased the appraisal. However, consumers have to be given a copy of the report upon written request, due to the Equal Credit Opportunity Act.

Myth: It doesn't mean anything to consumers what's in the appraisal so long as it satisfies the requirements of their lending agency.

Fact: A home buyer should definitely look through their report; there might be some questions or some worries about the accuracy of the inspection that should be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. An report can serve as a record for the future, containing an exorbitant amount of information - including, but certainly not limited to the legal and physical description of the property, square footage measurements, list of comparable properties in the neighborhood, neighborhood description and a narrative of current real-estate activity and/or market trends in the proximity.

Myth: There is no reason to hire an appraiser unless you are trying to get an assessment of the worth of a home during a sales transaction involving a lending agency.

Fact: Appraisers can have many varied qualifications and designations which allow them to perform a multitude of different services including - but certainly not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.

Myth: You don't need to get an appraisal if you order a home inspection.

Fact: A home inspection has a completely different purpose than an appraisal report. The task of the appraiser is to form an opinion of value in the appraisal process and through writing the report. House inspectors will write a report that will determine the condition of the house and its major components and possible damage.