The process of buying a new home is always a long and nerve-wracking one. At times it can seem like you have a never-ending list of tasks to do. Though many of these tasks are relatively straightforward, there are many which are not as well understood. In particular, there is some mystery around what exactly a home appraisal is and how it may impact your home-buying process.
What is a home appraisal?
In its purest form, a home appraisal is an expert evaluation of your home to determine what its value. It will, of course, be completed by a licensed professional with an understanding of the homes in your area.
How do appraisals affect your home loan?
An appraisal of your potential home determines whether a bank or a lender will approve your loan request. You will not be granted a home loan without one because a lender needs to make sure you aren’t attempting to borrow more money than the house is worth.
When do you get an appraisal?
You may be required to get an appraisal in some cases, such as on a home you want to buy or of your current home that you want to sell. A bank or lending institution will require an assessment of your potential home to make sure you aren’t borrowing more money than you need. If you are considering selling your home, an appraisal will also help you determine how much you can get for it.
How much does an appraisal cost?
The appraisal’s cost will depend on the size and value of the home as well as the type of evaluation required. Larger homes and in-home assessments will cost more than smaller homes and drive-by appraisals. The average appraisal cost ranges in the $400 to $600 zone.
What do appraisers look for in a property?
When placing a value on your home, the appraiser takes several aspects into account.
- Size and type of home
- Home’s condition
- Overall real estate market in the area
- Comparative recent home sales
- Areas needing maintenance
- Estimated selling time
How can you increase the appraised value of your home?
Because a vast majority of the appraisal value rests on the condition of your home, you should complete any repairs and maintenance procedures before your schedule your appraisal.
Whatever the reason for your home appraisal request, the information above will help ensure you are much more knowledgeable about the entire appraisal process.