An appraisal is an necessary aspect of the home mortgage approval process

If you are shopping for a colorado stated loans to purchase a home or refinance your current mortgage, you may already know that a home appraisal is almost always required before a mortgage can be approved for a florida fha loans. However, if you are like many other borrowers, you might not know about appraisals or why they’re are so essential.

Appraisals have been a hot topic in recent months due to new rules that have changed how mortgage companies and mortgage lenders orders appraisals for certain types of loans. The rules are spelled out in the Home Valuation Code of Conduct (HVCC), which became effective May 1, 2009.

What is an appraisal?

A property appraisal is an opinion of a property’s value prepared by a licensed real estate appraiser. Each house is unique, so the appraiser must rely on her experience together with the facts gathered about the neighborhood such as real estate sales prices of other comparable home to determine the value of a property. Appraisal are meant to be unbiased and free from the influence of anyone’s opinion of the home’s value. The new rules have placed greater restrictions on attempts to unduly influence appraisers.

Who pays for the appraisal?

home buyers pay for a home appraisal upfront since the appraisal must be completed before the banks will approve the loan. Under the new HVCC rules, borrowers who switch to a different loan providers during the mortgage process, as sometimes happens, will most likely have to pay for another appraisal to satisfy the new loan providers approval requirements. Even though the borrower pays the appraiser’s fee through the mortgage companies, the appraiser typically is independent of the servicers. The main purpose of an appraisal is to help the lender assess the value of the property and decide whether to approve the loan. That’s why a new appraisal typically is required for a loan refinance as well as a home purchase.

Is an appraisal the same as a home inspection?

Another common misconception is that a home purchase appraisal is the same as a home inspection. Appraisers do consider the condition of the home and may note any major problems.

First Choice Mortgage Company’s is committed to be a information resource for the Colorado mortgage consumer and a full range of loan tools can be found on our website www.FirstChoiceMortgageCoLLC.com. We pride ourselves on being a full-service loan lender where you get the advantage of experienced loan professionals, great rates and a very wide range of loan products.

We have built our reputation on providing outstanding service to its clients and the launch of the website is yet another example of the company’s dedication to exceeding expectations.