A home appraisal is a process that involves a certified third-party appraiser reviewing the home and comparing it to other homes in the area to determine its fair market value. It is typically required by the lender when someone is using a mortgage to purchase a home or refinancing their current mortgage. The appraiser will inspect the interior and exterior of the home, including major systems and appliances, and note any areas of concern. They will also consider the condition of the property, any upgrades or additions made to the property, the size of the lot, and recently sold properties of comparable size and condition in the same market. The appraiser will then compile all of their findings into a report and generate the home’s appraised value.
During a home appraisal, it is important to improve your curb appeal, as it is the first thing the appraiser will see when they arrive at your home. It can also indicate that you’ve maintained the rest of the home as well, so if your exterior looks a little ragged, make sure you clean it up. It is also recommended to be present during the home appraisal and provide the appraiser with valuable information. However, it is important to avoid any attempts to argue with or persuade the appraiser.
If the appraisal comes in at or above the contract price, the transaction proceeds as planned. If the appraisal comes in below the contract price, it can delay or derail the transaction. The appraisal is also important to the buyer and seller because an appraisal value that comes in lower than the agreed-upon price could prompt a buyer to reopen price negotiations.
