Home Appraisal: What You Should Know When Applying for a Mortgage

• June 18, 2017

Home appraisal is a vital process when you are applying for a mortgage. Typically, the lender will order the appraisal, but the buyer will be the one to shoulder the cost of the appraisal, though it is not always a frightening figure that will deter you. Appraisal, should not stop you from making an offer since it will be ordered only after your offer has been accepted.

What determines the home’s value?

A number of aspects are considered when conducting and appraisal, and as a buyer, it is vital for you to understand, so that you can speak up if you realize that certain things in the appraisal report are not adding up.

The first process will be for the appraiser to visit the property, during which they will take the measurements of the property to determine its size, check the number of bathrooms and bedrooms, and compare their results with the data available at the local country records for accuracy.

The appraiser will also check other major structures and systems in the house, including but not limited to:

• Termite, water and mold damage
• The state of the furnace
• The state of HVAC systems
• The state of the plumbing systems

They will also take into account the major improvements or upgrades, which in their opinion may be necessary, to restore the house to good condition.

Comparing the value and the final appraisal report

Using the information gathered, the appraiser will compare what he has concerning the value of homes with similar features in that same area. He will then use such comparable properties to determine the ultimate value of the house. This will then be followed by a comprehensive report which you will be presented with, and which you must scrutinize to ensure that nothing out of the ordinary was included or omitted. The report will also be used by the lender, to determine the lending facility they can extend to you.