FAQ

Each property is unique, and the appraiser relies on his or her general expertise and specific research to arrive at an opinion of value. Appraisals are an infrequent experience for most consumers, who consequently tend to have some misconceptions about the process and the results. Here are some myths and facts:

Is the primary purpose of an appraisal to make sure that the buyer does not pay too much for the house?
An appraisal provides valuable information for the buyer and the seller, but the appraiser’s primary mission is to protect the lender.  Lenders do not enjoy owning overpriced property, so that is why the appraisal takes place before the lender grants final approval of the buyer’s loan.

Do appraisers use a specific formula (e.g. price per square foot) to figure out exactly how much each home is worth?
Appraisers weigh the location of the home, its proximity to the desirable schools and other public facilities, the size of the lot, the size and condition of the home itself, and recent sale prices of comparable properties among other factors.

Can good housekeeping improve a home’s valuation?
Appraisers are not interested in whether or not the owner had dusted that day or if he or she is in the middle of folding laundry.  Housekeeping is not the issue, although a clean home can indicate a home that has been well taken care of.  The overall maintenance of the home is of primary interest: Are the walls, flooring, and floor covering in good shape?  Are the built-in appliances in good working order?  Are the mechanical systems (plumbing, electrical, heating and cooling) functioning properly?

Can anyone with a clipboard and business cards be an appraiser?
Federal law requires states to establish minimum standards and licensing practices for real estate appraisers. 

Do appraisers have an obligation to reveal home defects to buyers?
If the buyer is applying for a mortgage that will be insured by the Federal Housing Administration (FHA), the appraiser must survey the physical condition of the home and disclose potential problems to the buyer.  No such obligation exists for non-FHA mortgages.

Is an appraisal identical to a home inspection?
An appraisal is not a substitute for a professional home inspection.  The appraiser formulates an opinion of the property’s market value for the lender in a typical transaction (Purchase or Refinance), while the home inspector educates the buyer about the condition of the home and its major components.   For a referral of an inspector in your area, visit www.ashi.com

What should I do in preparation for the appraiser to come to my home?
The best things that you can do for any appraiser is have your home ready for viewing. Have all rooms and areas unlocked and open for the appraiser to view. Be ready with a list of any improvements or renovations that have been done to your home as well as a list of any items that are in need of maintenance. Also, have any legal documents, deeds, plats or sketches of you property available for the appraiser to view.