Appraisal myths & facts

By law, an appraiser needs to be state-licensed to offer appraisals for federally-related purchases. You also have the right to request a copy of the finished report from your lending agency. Contact James Earp Appraisal Service if you have any questions about the appraisal process.

Myth: Assessed value will always be the same as to market value.

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. Interior remodeling that the assessor is unaware of and a lack of reassessment on nearby properties are prime examples of why this occurs.

Myth: Depending on if the appraisal is provided for the buyer or the seller, the opinion of value of the home will vary.

Fact: The cost of the home does not affect the pay of the appraiser; as a result, the appraiser has no personal interest in the worth of the property. Obviously, he will conduct business with impartiality and independence regardless for whom the appraisal is created.

Myth: The replacement cost of the house is always is on par with the market value.

Fact: The way market value is arrived at is based on what a buyer would likely pay a willing seller for a property without being under pressure from any outside group to purchase or sell. Replacement cost is the dollar amount required to rebuild a home in-kind.

Myth: Certain formulae, like the price per square foot, are the ways appraisers use to come to the worth of a home.

Fact: An appraisal report is an assertion of information concluded from the property's size, location, proximity to some facilities, the condition of the home and the cost of recent comparable sales. You can rely on James Earp Appraisal Service's appraisers to be ethical in assessing this data.

Myth: In a powerful economy - when the values of houses in a given region are found to be increasing by a certain percentage - the prices of individual houses in the area can be expected to increase by that same percentage.

Fact: Any value at which an appraiser arrives in regards to a particular home is always personalized, based on certain factors concluded from the data of comparable properties and other specifications within the house itself. It makes no difference if the economy is powerful or poor.

Myth: The property's exterior is determinate of the actual value of the property; it is unnecessary to do an interior inspection.

Fact: To find an accurate value beyond all doubt, an appraiser must assess the home on a variety of factors based on area, condition, improvements, amenities, and market trends. An exterior inspection certainly can't provide all of the data required.

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

Fact: Unless a lending agency releases its vestment in the appraisal report, it is legally owned by the lending agency that purchased the appraisal. Due the Equal Credit Opportunity Act, any consumer requesting a copy of the document must be given one by their lending company.

Myth: It doesn't concern consumers what's in the appraisal report so long as it meets the needs of their lender.

Fact: Only if home buyers check out 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, as it contains a great deal of information - 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.