Appraisal myths debunked

It is required by legal agencies that a real estate appraiser is required to be state-licensed to produce appraisal reports for federally-supported property purchases in Tennessee. Also by law, you have the ability to request a copy of the finished report from your lender. Contact Integrated Assets if you have any concerns about the appraisal procedure.

Myth: Market value will always be the same as the assessed value of the property.

Fact: This usually isn't true; most states do support the idea that the assessed value is the same as market value, but not always. Sometimes when interior remodeling has occurred and the assessor is has not investigated the improvement or properties in the memphis have not been reassessed for quite a while, it may vary wildly.

Myth: The opinion of value of a house will differ depending upon whether the appraisal is ordered for the buyer or the seller.

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

Myth: Any time market value is established, it should be similar to the replacement cost of the property.

Fact: Without any influence from any different parties to buy or sell, market value is what a willing buyer would pay an interested seller for a specific home. Replacement value is the dollar amount required to reconstruct a house in-kind.

Myth: Certain methods, like the price per square foot, are the methods appraisers use to arrive at the cost of a house.

Fact: There are many differing methods that an appraiser will use to make a full investigation of every factor in consideration of the property, such as the size, location, condition, how close it is to undesirable facilities and the sales price of recently sold comparable properties.

Myth: When the economy is doing well and the value of houses are found to be rising by a certain percentage, the other properties in the area can be expected to appreciate based on that same percentage.

Fact: Price increase of a certain property must be concluded on a case-by-case basis, factoring in information on comparable houses and other relevant considerations. It doesn't matter if the economy is on the rise or declining.

Myth: You can generally tell what a house is worth simply by looking at the exterior.

Fact: To find an accurate price beyond all doubt, an appraiser must examine the house on a variety of factors based on area, condition, improvements, amenities, and current market trends. An outside-only inspection definitely can't provide all of the data necessary.

Myth: Since you're the one coughing up the cash for the appraisal when applying for your loan to buy or refinance your house, you own the produced appraisal report.

Fact: Legally, the appraisal report is owned by the lending company unless the lender releases their interest in the appraisal. Because of the Equal Credit Opportunity Act, any home buyer requesting a copy of the document must be provided with it by their lending agency.

Myth: Home buyers need not worry about what is in their appraisal document so long as it meets the requirements of their lending agency.

Fact: A home buyer should definitely inspect their appraisal report; there could be some questions or some worries about the accuracy of the appraisal report that need to be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. There is an incredible amount of information stored in an report that can be useful to the consumer in the future, such as 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.