The Home Buying Process – Appraisal

By
Real Estate Agent with AgentOwned Realty, Heritage Group, Inc.

Appraisals are required by almost every lender.  An appraisal is done by an independent third party individual who has no interest in the sale of a property. 

Appraisals are to protect both the investment made by the mortgage company and the investment made by the purchaser.  The appraisal will visit the property and makes notes in regards to the size, rooms and finishing inside the home.  The appraiser will then prepare the appraisal based upon comparable sales in the area in the past 6 months to a year.  (This time frame may be longer if no other comparables are found.)

What happens after the appraisal?  The mortgage company receives a copy of the appraisal and reviews the appraisal to the sale price.  If the home appraises for a value higher than the sale price, all is good in the sale.  If the home appraises for a value lower than the sale price, there are options.  Be sure to check with your Realtor®, as every Agreement to Purchase may have different options.

The first option is the Buyer notifies the seller they want to reduce the purchase price to the appraisal value.  Both parties may agree to the price reduction or they can renegotiate.  The second option is the Buyer can proceed to closing with the agreed upon purchase price and will have to pay the difference between the purchase price and the appraised value.  The third option is the Buyer may terminate the Agreement To Buy and Sell Real Estate and depending on the financing and Agreement the Buyer may or may not forfeit their Earnest Money.

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Information and Content in this blog is original to Kim Peasley-Parker unless otherwise stated.

Kim Peasley-Parker, Sumter Real Estate

 

 

Kim Peasley-Parker

Realtor (R) /Shareholder

AgentOwned Realty Company

Heritage Group, Inc.

Cell 803-840-7519

Email: kim@agentownedrealty.com

 

 

 

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Will Nesbitt 09/26/2013 06:06 AM
Topic:
Home Buying
Location:
South Carolina Sumter County
Groups:
AgentOwned Realty
Tags:
south carolina appraisals
sumter sc appraisal
fha va addendum to agreement
bad appraisal options

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Rainmaker
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Robert Bob Gilbert
Berkshire Hathaway HomeServices Anderson Properties - Katy, TX
Your Katy TX ( West of Houston) Real Estate Expert

Hi Kim,

 

I cannot believe I am the first comment ob  your blogs. good explanation of the appraisal process. I put in my contracts that is the home does appraise at or higher than selling prive buyer can terminate the contract and get 100 % of their earnest money back. 

Sep 28, 2013 06:38 AM #1
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Rainmaker
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Kim Peasley-Parker

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