A home appraisal is the estimated value of a home by a professional. Whether you are the buyer or the seller of a property, a home appraisal is an important process in the home buying and/or home selling process. A home’s appraisal establishes a given property’s current market value meaning, the value of the given property in a current real estate market for the area in which the home is located.
If you are financing your home through a mortgage lender they require a home appraisal to protect their investment. A lender will have an objective third party, a licensed appraiser, visit and prepare a detailed report of the property. The appraiser will evaluate the home based on the home itself and what it has to offer, and then, compare it to homes that have recently sold in the area. By comparing what the home has to offer to similar homes that have sold, an appraiser can adjust the value up or down depending on features the home in question has or doesn’t have compared to recently sold homes that are as comparable as possible to the subject property.
The appraisal report will give details about the subject property along with several comparisons of similar properties in the proximity of the subject property. This is how the appraiser comes to a valuation of the subject property for the mortgage lender. This lets the lender know that the subject property’s value meets the contracted price that the buyer has with the seller. If the subject property does not appraise for the contracted price then the buyer and seller will have to re-negotiate the deal or the deal will not be able to move forward as it is written. A lender needs to make sure that they are lending the fair market value of the subject property to the buyer for what the home would sell for in the event that the new buyer was to default on the home and the lender would have to sell the property to re-coop their investment. If you need help with this process be sure to contact Siesta Title & Escrow @ (941) 889 – 7744!