Special offer

How to prepare for an Appraisal to maximize value the Do's and Don'ts

By
Services for Real Estate Pros with Buildalegacygroup #01089189

So you've scheduled the appointment with the Appraiser to have your home appraised.  What should you do prior to the inspection, to maximize your value and possibly save some money as well?

In the days prior to the appraisal inspection, do a home inventory of all the repairs you've made since you bought the home include (copies of receipts if you have them) or your contractors estimates/ cancelled checks for major improvements.  If you cant find the paperwork list them down with your best estimate for each. 

We recommend you bullet point all of these improvements and repairs on a piece of paper and present it to the appraiser when he/she first walks in.  This will assure that the Appraiser doesn't miss anything and will speed up the appraisal inspection.  Get copies of "signed off: permits or contractor estimates of work you have done.  The Appraiser will require a copy of a signed off permit for any additions to be credited.  Most often than not it does not appear on city records (not updated yet in many cases).  If you don't have this at time of inspection the Appraisal can be made "subject to" permits thus causing delays.  Or in many cases it is completed "as is" omitting the area altogether and giving this area value as additional storage area as an example.

If you have a copy of your previous appraisal make a copy of the report prior to the inspection and provide it to the Appraiser.  (The appraiser can use the previous sketch of the floor plan rather than redrawing it.)  They may also have pertinent info that the new appraiser is not aware of that they can refer to by having a copy of the last report.  Some will verify a few of the measurements or use it altogether, this also saves them and you time.  If you have done improvements since the appraisal was done make sure you list them as suggested above. 

After providing them with a copy of the previous appraisal report, don't expect the appraiser to come in at what the last appraisal did?  The market conditions have likely changed since the last inspection in some cases for the better or worse. 

Don't ask the appraiser what value he/she is coming in at at your home?  The appraiser may already have an idea but they still have to drive comps (other homes sold in your neighborhood) and adjust for differences to arrive at a final value conclusion.  In many instances the lender may have another appraiser review the report and have a difference of opinion.  You think everything is peachy until you get the word that the value conclusion is different than what was shared with you at your home. 

Call your lender and ask if the appraisal has been reviewed by the underwriter and if the value estimate was approved.  You can ask what the final value was and ask for a copy of the report within 90 days from the date of inspection. (The lender may be reluctant to give you a copy of the report out of fear that you are "Shopping them" with another lender) Let them know you are not and that they are required to provide you with a copy.  (provided that you paid for it up front)  You cannot get a copy directly from the Appraiser it must come from your lender.

Don't follow the Appraiser around pointing out every small detail of the home. This is not only distracting but many homeowners unwittingly point out various things they've done to the house that have little or no impact on the value.  The Appraiser is not there to buy your home so you don't have to try to sell it to them. 

The Appraiser can only address what presently exists and the condition your home is in at the time of inspection.  They can address your property "as is" or "subject to" in determining the estimate of value.  Don't tell the Appraiser of all of the things you plan/hope/wish to do to your home.  In most cases it will have little to no impact in the final value estimate.  Save your wish list for your contractor.

Don't worry about not having the laundry done.  We are not there to judge your housekeeping; we are only looking at the physical characteristics and condition of your home.   However remember that the appraiser will be taking interior photos for the lender a well as for the appraiser's own liability.

Most Appraisers love dogs but place them out of the way or in a kennel or dog run when the appraiser is there. 

Don't water down your yard and driveway right before the Appraiser inspects your home if you can.    The appraiser finds him/herself walking thru mud which could be tracked into your home and increasing the possibility of slipping or falling. 

If you have security bars on your bedroom windows and they have no safety releases they must be removed.  This is not only for your health and safety but the lender will require that they be removed.  If they are not removed prior to the inspection, the appraiser must set up a re-inspection which will be an additional cost to you from the appraiser as well as your time and delay of your loan.  You could lose a rate lock with the added delay.

Follow these do's and don'ts and you will speed up the inspection process, assure nothing is missed, and maximize the appraiser's ability to determine the estimate of market value of your home. 

www.viphomesbypablo.com  Copyright © 2007 All Rights Reserved

Scott Daniels Florida Real Estate 2.0. Agents Earn 100% Commission.
Florida List For Less Realty, Inc. Broker/Owner. - Cooper City, FL

 

PS,

In our area, the apprisers don`t look for things that you`ve mentioned! It appears that the appraisers in your area are more akin to inspectors...

Thanks for the heads up..

May 10, 2007 11:49 PM
Pablo Santibanez
Buildalegacygroup - Santa Clarita, CA

Hi Scott,

Thank you for your comments.  Although it may appear that an Appraiser is akin to a home inspector and there are some similarities, the fundamental difference between our industries is that our primary focus as Appraisers is estimating a properties market value.  The Appraiser will report the general overall condition of the home.  A home inspector will do a more thorough physical inspection. There primary objective is to point out specifically all of the items that need repair such as electrical sockets that are not working, etc... and report the condition of every working/non-working item in the home. 

We do not as appraiser check every item of the home as an inspector does.  Every region throughout the country have specific issues that pertain to their market area.  The issues I spoke of are common in the California Market.  Not all homes in Califiornia have security bars however there are some market areas in California where every home does have them.  There are basic fundamentals that all appraisers do irregardless of the area.  They report any obvious Health and Safety violations to protect the consumer/lender and themselves. (Window bars without safety releases) as an example.  Any differences between their measurements and city records.  It may appear that appraisers in your region do not take these basics into consideration but they do.  You may not be aware of it because say for example, there is a discrepancy in what the city records show and what they measured, they may likely not include this additional footage because it  would require permits and the appraisal would be "subject to" permits.  This will hold the loan up and everyone gets upset.  The addition could be legal but the city records in some cases have not been updated which short changes the homeowner with a lower value.  The appraiser may include the footage and prays it's legal and the lender overlooks this and does not require any explanation for the variance.

What I am recommending to homeowners is, if they have added on or made major improvements that they assure themselves that they minimize the time and the additional expense of the inspection and potential re-inspection and maximize the estimated market value by doing some of the basics prior to the appraisers visit.  It is not required, but it sure helps speed up the process and avoid unnecessary delays.

May 11, 2007 03:32 AM
Robert Thomas
Fairfax Realty Inc - Columbia, SC
Pablo, some ideas that I can use to help my clients, thanx.
Aug 10, 2007 10:05 AM
Pablo Santibanez
Buildalegacygroup - Santa Clarita, CA

Hi Robert,

Glad to provide the info and that you found it helpful.  Thank you for your service to this country.  It is an honor to meet you.

Aug 11, 2007 01:13 PM
Dom Naidoo
Westside Properties - Venice, CA
Malibu to the Marina Real Estate
Great post! Very helpful information. I'm definitely looking forward to your next post. All the best of luck!
Aug 11, 2007 02:29 PM
Pablo Santibanez
Buildalegacygroup - Santa Clarita, CA

Hi Dominic,

Thanks for your comments. I am glad you found my topic useful, and good luck to you as well.

 

Aug 11, 2007 05:32 PM
Sara Goodwin
Estimation Nation Corporation - Portland, OR
Portland, Oregon Appraiser
Thank you, Pablo - You brought up some points that I wouldn't have thought up (ie: watering down the grass, driveway) - I hope you don't mind if I link this to a blog that will be posted in the appraiser's group later today....
Feb 08, 2008 08:44 AM
Michael Zollo
Coral Springs, FL
Certified Residential Appraiser, South Florida, FH

Great post Pablo, I wish most brokers would tell the people, what to expect, from an appraisal. I realy love the part about not following us and talking to us the whole time.

Scott, I work in your area, I don't know who has been doing your appraisals, but I know I look around and check out the upgrades, if any, and damages, or obsolescence. And yes it is akin to a mini inspection. Its not, take the exterior photos, 3 interior photo's, get the check and out the door.

Feb 08, 2008 01:19 PM
Pablo Santibanez
Buildalegacygroup - Santa Clarita, CA

Hi Sara,

Thank you for including my post on your "Appraisers group" blog.  I'm glad you found it to be insightful to include in your blog.  I wrote it with the intention of it being a win/win for all involved in the appraisal process, the homeowner, the appraiser, and the broker involved.

Pablo 

Feb 09, 2008 01:37 AM
Pablo Santibanez
Buildalegacygroup - Santa Clarita, CA

Hi Michael,

Glad you enjoyed it, It is important that agents and homeowners understand that appraisers are not there to "Buy" the home so it is not necessary that they follow you from room to room to point out things.  As appraisers you are trained to look more in depth than just the "features"  It is good practice that the real estate agent or homeowner supply you with a list of all the upgrades and features in order not to "miss" anything in a sale or refinance.    Unfortunately those that do the latter as you mentioned makes those appraisers that due a thorough inspection look bad.  It should be the other way around!

Pablo 

 

Feb 09, 2008 01:50 AM
Mike McCool
Darrell McCool Appraisal Service - Redwood City, CA

Pablo, I am an appraiser and I find your post extremely helpful and correct. Regardless of  there being a previous appraisal report the appraiser should always measure the property. I have found many mistakes in other companies reports. Plus, it only takes a few extra minutes to measure. Very well written. 

www.dmcappraisals.com 

Feb 19, 2008 12:15 PM
Pablo Santibanez
Buildalegacygroup - Santa Clarita, CA

Hi Mike,

I'm glad you found my post helpful.  You are absolutely right, you should always double check the sketch for errors.  It's a lot easier and faster (In most cases) to verify an existing sketch than to re-draw it yourself at the inspection especially when you have a complex structure.  Thanks for your input.

Feb 19, 2008 02:21 PM
Patrice Estess
PB APPRAISALS - Kerhonkson, NY

great post, thanx Pablo.  I found some of that information very helpful and some is not as pertinent in my area.  I love the mud one!!

 

Feb 24, 2008 02:56 AM
Pablo Santibanez
Buildalegacygroup - Santa Clarita, CA

Hi Patrice,

Glad you found it helpful, thanks for your imput and don't forget to wipe you feet!!  LOL!

Feb 24, 2008 04:26 AM
Anonymous
Nathan Gurley

 

Wow Pablo!  I need to copy the "Don't follow around rule", laminate it, and handed it out occasionally.  Seriously, I miss things when people are steadily selling me their house. Also, has anyone ever heard, "Oh, he's a good dog; he’ll just lick you to death".  I'm like, "Sorry ma'am we're not going to find that out today" or "I won't be able to appraise the dog today, can you put him/her up please?”

Great stuff - excellent post!

www.AppraisalHomeBiz.com 

 

 

Aug 23, 2008 03:10 AM
#15
Dave Sullivan
Real Estate One - Birmingham, MI
Michigan Realtor with an investor viewpoint

Excellent information I will forward it if that is ok? thank you!!!

Dec 05, 2012 12:18 AM
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • GRI • HAFA • PSC Calabasas CA

The best way to prepare for an appraiser inspection: to work with an experienced agent from the very beginning, pricing the property correctly and preparing it to pass successfully all inspections. 

Jul 28, 2017 09:34 PM