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Common myths about appraising

It is mandated by law that a real estate appraiser is required to be state-licensed to offer appraisal reports for federally-related home transactions in Washington. The law gives you the right to receive a copy of your finished appraisal from your lender after it has been provided. Contact us if you have any questions about the appraisal procedure.

Myth: The value that is ascertained by the appraiser is required to be equivalent to the market value.

Fact: While most states back the suggestion that assessed value is equal to estimated market value, this often is not the case. Interior remodeling that the assessor is not aware of and a dearth of reassessment on nearby homes are exact examples of why the price can vary.

Myth: Depending on if the appraisal is drawn up for the buyer or the seller, the value of the house will vary.

Fact: There is no personal interest on the part of the appraiser in the result of the appraisal report, therefore he will conduct his work with impartiality and independence, despite for whom the appraisal is created.

Myth: Any time market value is found, it should be the same as the replacement cost of the home.

Fact: Without any influence from any different parties to purchase or sell, market value is what a willing buyer would pay an interested seller for a particular home. Replacement value is the dollar amount needed to rebuild a property in-kind.

Myth: Specific formulae, such as the price per square foot, are what appraisers use to ascertain the price of a house.

Fact: An appraisal is a collection of information concluded from the house's size, location, proximity to specific facilities, the condition of the home and the cost of recent comparable sales. You can depend on Crest Appraisal Services's staff to be forthright in assessing this information.

Myth: In a strong economy - when the values of homes in a given region are found to be appreciating by a particular percentage - the prices of individual houses in the area can be expected to appreciate by that same percentage.

Fact: Any value at which an appraiser arrives in regards to a specific home is always individualized, based on certain factors concluded from the data of comparable houses and other considerations within the property itself. This is true in excellent economic times as well as poor.

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Myth: Just looking at what the home looks like on its exterior gives an excellent idea of its worth.

Fact: To determine an accurate value beyond all doubt, an appraiser must inspect the property on a variety of factors based on location, condition, improvements, amenities, and current market trends. As you can see, none of these factors can be found simply by inspecting the home from the exterior.

Myth: Because consumers fund appraisal reports when applying for loans to purchase or refinance their property, they own their appraisal.

Fact: Unless a lender releases its interest in the document, it is legally owned by the lending agency that ordered the appraisal. Under the Equal Credit Opportunity Act, any consumer demanding a copy of the document must be given it by their lender.

Myth: It doesn't mean anything to consumers what's in the appraisal so long as it satisfies the needs of their lending company.

Fact: A home buyer should definitely look through their report; there might be some questions or some worries with the accuracy of the appraisal report that must be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the report makes a near perfect record for future reference, comprised of helpful and often-revealing information - including, but 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 area.

Myth: The only reason someone would order an appraisal is if a house needs its price assessed in a lender sales transaction.

Fact: Hiring an appraiser can fulfill a variety of necessities depending on the designations and certifications of the appraiser involved; appraisers can perform a great deal of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.

Myth: There's no need to get an appraisal if you order a home inspection.

Fact: Appraisal reports are definitely not the same as a home inspection. An appraiser concludes on an opinion of value in the appraisal process and resulting appraisal report. House inspectors will create a report that will determine the condition of the property and its major components and possible damage.