Appraisal myths debunked

It is enforced by law that a real estate appraiser must be state-licensed to perform appraisals for federally-related real estate purchases in Wisconsin. You also have the right to acquire a copy of the completed report from your lending agency. Contact our professional staff if you have any concerns about the appraisal procedure.

Myth: The value that is assessed by the appraiser must be the same as the market value.

Fact: While most states back the idea that assessed value approximates estimated market value, this commonly is not the case. Examples include when interior reconstruction has happened and the assessor does not know about the improvements, or when homes in the area have not been reassessed for an prolonged time.

Myth: The appraised value of a property will differ depending upon whether the appraisal is ordered for the buyer or the seller.

Fact: The appraiser has no personal interest in the result of the appraisal and should complete services with independence, objectivity and impartiality - no matter for whom the appraisal is written.

Myth: The replacement value of the property is always is on par with the market value.

Fact: The way market value is found is based on what a buyer would be willing to pay a willing seller for a house without being under duress from any external group to buy or sell. The dollar amount needed to reconstruct a home is what constitutes the replacement cost.

Myth: There are certain methods that real estate appraisers use to find the value of a property, like the price per square foot.

Fact: There are many numerous formulae that an appraiser will use to make a comprehensive analysis of every factor in consideration of the house, such as the size, location, condition, how close it is to specific facilities and the sales price of recently sold comparable houses.

Myth: As houses appreciate by a certain percentage - in a robust economic state - the properties around the appreciating properties are figured to appreciate by the same amount.

Fact: All increase of value is on a one-on-one basis, concluded by data on relevant conditions and the data of comparable properties. It makes no difference if the economy is excellent or on the decline.

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Myth: The house's outside is determinate of the actual worth of the home; it is unnecessary to do an interior inspection.

Fact: There are a multitude of different factors that conclude property value; these factors include location, condition, improvements, amenities, and market trends. An external inspection certainly can't provide all of the data needed.

Myth: Since you're the one funding for the appraisal report when applying for your loan to buy or refinance your house, you own the produced appraisal report.

Fact: Legally, the appraisal is owned by the lending company unless the lender relinquishes their interest in the document. However, home buyers have to be supplied with a copy of the document upon written request, under the Equal Credit Opportunity Act.

Myth: There's no reason for home buyers to even care about what the appraisal report contains so long as their lending company is fine with the contents therein.

Fact: A consumer should definitely look through their appraisal; there will probably be some questions or some worries with 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 double as a record for the future, as it contains an exorbitant amount of information - including, but 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 area.

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

Fact: Based upon their qualifications and designations, appraisers can and often do provide a variety of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.

Myth: An appraisal is no different than a home inspection report.

Fact: Appraisal reports have almost nothing in common with a home inspection report. The appraiser decides upon an opinion of value in the appraisal process and resulting appraisal report. The job of a home inspector is to find the condition of the home and its major components, then create a report on these conclusions.