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Appraisal myths debunked

Legally, a real estate appraiser must be state certified to perform legitimate real estate appraisals for federally-related purchase. Also by law, you have the right to demand a copy of the completed appraisal report from your lender. Contact Desert Sky Appraisers if you have any concerns about the appraisal procedure.

Myth: Market value will be the same as the assessed value of the property.

Fact: This is not often the case; most states do support the idea that the assessed value is the same as market value, but not always. Interior remodeling that the assessor is unaware of and a lack of reassessment on nearby properties are exact examples of why there might be a differential in price.

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

Fact: The value of the property does not affect the payment of the appraiser; because of this, the appraiser has no personal interest in the opinion of value of the house. What this means is he will render business with impartiality and objectivity regardless for whom the appraisal is created.

Myth: Market value will equate to replacement cost.

Fact: Without any suggestion from any outside parties to buy or sell, market value is what a willing buyer would pay an interested seller for a specific home. If the house were reconstructed, the dollar amount required to do so would make up the replacement cost.

Myth: Appraisers use a calculation, like a specific price per square foot, to conclude the value of a house.

Fact: Appraisers complete a detailed analysis of all factors pertaining to the price of a property, including its location, condition, size, proximity to facilities and recent worth of comparable properties.

Myth: When the economy is robust and the value of properties are reported to be appreciating by a certain percentage, the other homes in the proximity can be expected to increase based on that same percentage.

Fact: Any cost at which an appraiser arrives concerning a particular property is always personalized, based on certain factors found from the data of comparable homes and other considerations within the home itself. It doesn't matter if the economy is doing well or declining.

Have other questions about appraisers, appraising or real estate in Maricopa County or Chandler, AZ?

Contact Desert Sky Appraisers

Myth: You can usually find what a home is worth simply by looking at the exterior.

Fact: Home value is concluded by a number of variables, including - but not limited to - location, condition, improvements, amenities, and market trends. An external inspection obviously can't provide all of the data required.

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

Fact: The appraisal report is, in fact, legally owned by the lender - unless the lender "releases its interest" in the appraisal report. However, home buyers have to be supplied with a copy of the appraisal upon written request, because of the Equal Credit Opportunity Act.

Myth: Consumers need not care about what is in their appraisal document so long as it satisfies the needs of their lending institution.

Fact: A consumer should definitely look through their appraisal report; there could be some questions or some worries about the accuracy of the inspection that must be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the appraisal makes an excellent record for future reference, containing helpful and often-revealing data - including 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 vicinity.

Myth: There is no reason to order an appraisal unless you are trying to get an assessment of the cost of a home during a sales transaction involving a lender.

Fact: Appraisers can have many varied qualifications and designations which allow them to provide a variety 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: A property inspection serves the same purpose as an appraisal.

Fact: Appraisal reports are definitely not the same as a home inspection report. The function of an appraisal report is to find an opinion of fair market value during the appraisal process and the production of the report. A home inspector analyzes the condition of the house and its major components and reports their findings.