If you know anyone refinancing remind them of these important points in order to get the best appraisal possible:
1. Ensure that the appraiser is a Certified Residential Appraiser- This means more experience and training. When they call to make the appointment, ask them. If they are not a CRA, cancel the request immediately to avoid a trip charge. If they are a CRA, you will make them feel good about doing the extra work, and it is always good to have an appraiser that feels valued.
2. Know the recent comparable sales in your neighborhood. Call your real estate agent or a highly experienced lending professional. Hint, Hint. Some appraisers will also gather comps for a nominal fee.
3. Know of any anomalies that caused recent sales to occur below value. Appraisers will avoid bank owned properties and shorts sales if possible because these are usually not fair market conditions. There is distress involved leading to a seller's desperation. Tragedy, divorce, job change forcing a relocation are also stressors than can require a home to be sold quickly or without concern as to fair market value. However, these circumstances are typically not public information. An appraiser will often discount the weight of such sales if it can be documented, but they would need to be made aware.
4. This one is obvious, but clean your house. I have seen two appraisals of the same house, and one came in $10,000 lower, because I neglected to tell the borrower to clean their home and declutter.
5. Be on time and polite. If you have pulled comps offer them, but don't push them on the appraiser. These professionals (usually) are typically working hard for their money, especially since the enactment of the Home Valuation Code of Conduct which requires a middle man in the order process who eats up a lot of the appraiser's income.
If you have any other questions, or thoughts please reply and hopefully we can create a useful dialogue to home owners looking to get the most value possible in an era of very conservative valuations.
Comments(1)