Common myths about appraising
By law, an appraiser is enforced to be state-licensed to offer appraisals for federally-related sales. The law gives you the right to receive a copy of your completed appraisal report from your lender after it has been provided. Contact us if you have any concerns about the appraisal procedure.
Myth: Assessed value generally will equate to market value.
Fact: This is not often the case; most states do support the idea that the assessed value is the same as market value, but not always. Interior reconstruction that the assessor has not investigated and a lack of reassessment on nearby homes are prime examples of why the price can vary.
Myth: The buyer or the seller may have an influence in the cost of the house depending upon for whom the appraiser is working.
Fact: The appraiser has no vested interest in the result of the appraisal report and should complete services with independence, objectivity and impartiality - no matter for whom the appraisal is conducted.
Myth: The replacement value of the property will be is on par with the market value.
Fact: Market value is acquired by what a willing buyer would likely pay a willing seller for a particular home, with neither being under pressure to buy or sell. If the property were reconstructed, the dollar amount necessary to do so would make up the replacement cost.
Myth: Certain methods, like the price per square foot, are what appraisers use to come to the cost of a home.
Fact: An appraisal is an assertion of information based on the property's size, location, proximity to certain facilities, the condition of the property and the worth of recent comparable sales. You can rely on Magee Appraisal Service's appraisers to be professional in assessing this data.
Myth: In a powerful economy - when the prices of houses in a given neighborhood are reported to be rising by a particular percentage - the costs of individual houses in the vicinity can be expected to rise by that same percentage.
Fact: Cost appreciation of a certain property must be concluded on an individualized basis, factoring in data on comparable houses and other relevant considerations. It doesn't matter if the economy is doing well or declining.
Have other questions about appraisers, appraising or real estate in Frederick County or Fredrick, MD?Contact us
Myth: The house's outside is determinate of the actual worth of the house; it is unnecessary to do an interior appraisal.
Fact: There are a multitude of different variables that conclude the value of a house; these factors include location, condition, improvements, amenities, and market trends. Obviously, none of these factors can be derived just by viewing the house from the exterior.
Myth: Because consumers pay for appraisal reports when applying for loans to buy or refinance their house, they legally own their appraisal report.
Fact: Legally, the report is owned by the lender unless the lender releases their interest in the appraisal. By the Equal Credit Opportunity Act, any home buyer requesting a copy of the report must be given one by their lender.
Myth: Home buyers need not worry about what is in their appraisal document so long as it satisfies the requirements of their lending institution.
Fact: Only if consumers look through a copy of their report can they ensure its accuracy and possibly need to question the result. Remember, this is probably the most expensive and important investment a consumer will ever make. An appraisal can double as a record for the future, since it contains a great deal of data - including, but certainly not limited to the legal and physical description of the property, square footage measurements, list of comparable properties in the neighborhood, neighborhood description and a narrative of current real-estate activity and/or market trends in the proximity.
Myth: The only reason someone would hire an appraiser is if a home needs its value estimated in a lender-based sales transaction.
Fact: Hiring an appraiser can fulfill a variety of needs depending on the designations and certifications of the appraiser involved; appraisers can provide a multitude of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: An appraisal is no different than a home inspection.
Fact: An appraisal does not serve the same purpose as an inspection report. The task of the appraiser is to form an opinion of value in the appraisal process and through creating the report. The point of a home inspector is to determine the condition of the property and its major components, then produce a report on their inspection.