-->

Everything You Need to Know About Home Appraisals

If you’re planning on selling your home, you need to know how much your property is worth. The best way to get the most accurate value is through a home appraisal. That’s why they’ve become a standard step in the traditional selling process.

But what does a home appraisal involve? And what happens when your appraisal values your home at a lower price than you were expecting?

Keep reading to learn everything you need to know about home appraisals. 

 

What is a home appraisal?

When selling a house, accurate pricing is crucial so you can sell it for the right price. 

If the price is too high, then buyers will walk away. If it’s too low, you run the risk of losing out on profits. So how do you know if you’re listing your home for the right price? You need a home appraisal.

These are done to determine the value of your property, and they’re the only way to correctly price your home. 

During the home-selling process, an appraiser visits your home for a walk-through of the inside and outside, and confirms that your asking price is fair. The buyer, seller, and lender are all involved in the process, and the appraisal is completed by a professional state-licensed appraiser.

Appraisals are conducted after the buyer makes an offer. This is because the bank needs to guarantee that the property is worth the loan amount. 

If the house value exceeds the loan amount, the deal will fall through—they’re not going to loan additional money. But, a low value can result in a lost sale, too, and cause the buyer to miss out on funding. 

Home appraisals vs. home inspections

Many home sellers and buyers mistake home appraisals and home inspections for the same thing, but that’s a misconception. They both serve their purpose and are different steps in the process. 

As we mentioned above, home appraisals are used to determine the value of a property. Home inspections, on the other hand, are used to determine the overall condition of the house. 

During the inspection, a professional home inspector will look at the interior and exterior of the home thoroughly to look at the quality of plumbing, electrical wiring, and foundation, among other things. 

Depending on what they find, the buyer or lender may request repairs be made to bring the house to code. 

Appraisals, however, don’t result in repairs. It’s strictly for determining the value of the home. Home appraisers won’t inspect things like electrical or plumbing but instead, look at the features of a home. Things like upgrades, square footage, and overall curb appeal contribute to the value. 

Another difference between the two is the point at which they’re conducted. Home inspections happen much sooner in the selling process, during the contingency period, whereas appraisals are completed later on.  

What will an appraiser evaluate in your home?

If you’ve made it through the home inspection, gotten your home market-ready, listed it, and found a potential buyer, it’s time to get an appraisal. 

The sale may seem like a guarantee at this point, but mortgage lenders typically require an appraisal before completing the sale. This is to verify that the house is worth the amount that the borrower is asking for. 

Here’s what the appraiser will evaluate inside and outside the home:

Interior

  • The property’s square footage
  • Recent remodels and upgrades
  • The number of bedrooms and bathrooms
  • The size and condition of the basement
  • Condition of walls, floors, and windows

Exterior 

  • What public utilities are available in the area
  • The overall lot size
  • Your home’s zoning classification

How long does the home appraisal process take?

On average, the entire process takes up to two weeks. There are several components of a home appraisal including:

  • The mortgage lender submits an appraisal request through an appraisal management company (AMC).
  • An appraiser accepts the request.
  • The appraiser researches the property through public records.
  • The appraiser identifies comparables (comps) by reviewing recent home sales on similar properties.
  • The appraiser conducts an on-site review of the homes, which can take anywhere between 15 minutes to a few hours.
  • The appraiser prepares and submits a report to the lender or AMC for underwriting.
  • The lender forwards a copy of the report to the loan applicant. 

Preparing for your home appraisal

If you’re at the appraisal stage in selling your home, you’ll want to prepare by:

  • Confirming the appointment 
  • Gathering relevant documents like tax forms, HOAs, and permits
  • Creating clear access to the basement and attic
  • Repairing leaks or chipped paint 
  • Make sure all outlets work
  • Securing handrails 
  • Deep cleaning your home

Skip the appraisal and go straight to selling

What if you need to sell fast and don’t have time for an appraisal? Or, what if your appraisal results in a different value than you expected? You have one more option.

Sell to Simply. 

When you sell to us, no appraisal is required. Instead, you’ll get a fair cash offer based on the current value of your home. With us, you’ll not only save time but also money and stress. 

Get started today and request your offer now!

Blog Graphics-03

 

Additional Reading