Common myths about appraising
It is required by law that an appraiser needs to be state-licensed to write appraisals for federally-supported property purchases in California. You are also entitled by law to request a copy of the finished report from your lender. Contact JTC Valuations if you have any concerns about the appraisal process.
Myth: Market value should be similar to the assessed value of the property.
Fact: This usually isn't true; most states do support the concept that the assessed value is the same as market value, but not always. Interior reconstruction that the assessor is not aware of and a dearth of reassessment on nearby homes are excellent examples of why this occurs.
Myth: The buyer or the seller often will have leverage in the value of the home depending upon for whom the appraiser is working.
Fact: There is no real interest on the part of the appraiser in the outcome of the analysis, therefore he will complete his work with impartiality and independence, despite for whom the appraisal is written.
Myth: The replacement value of the house will be is on par with the market value.
Fact: The way market value is derived is based on what a home buyer would be willing to pay a willing seller for a home without being under influence from any external party to purchase or sell. If the home were rebuilt, the dollar amount necessary to do so would form the replacement cost.
Myth: There are certain methods that appraisers use to find the cost of a home, such as the price per square foot.
Fact: An appraisal report is an assertion of data based on the house's size, location, proximity to some facilities, the condition of the house and the worth of recent comparable sales. You can rely on JTC Valuations's appraisers to be ethical in assessing this data.
Myth: As houses appreciate by a specific percentage - in a strong economic state - the houses in proximity are figured to increase by the same amount.
Fact: Any cost at which an appraiser concludes concerning a specific property is always individualized, based on certain factors derived from the information of comparable properties and other considerations within the house itself. It makes no difference whether the economy is good or bad.
Have other questions about appraisers, appraising or real estate in Riverside County or Corona, CA?Contact JTC Valuations
Myth: The property's outside is determinate of the actual value of the home; it is unnecessary to do an interior inspection.
Fact: To determine an accurate value beyond all doubt, an appraiser must examine the house on a variety of factors based on location, condition, improvements, amenities, and current market trends. Obviously, none of these things can be found simply by viewing the home from the exterior.
Myth: Since you're the one funding for the appraisal report when applying for your loan to purchase or refinance real estate, you own the ordered appraisal.
Fact: The appraisal report is, in fact, legally owned by the lender - unless the lender "relinquishes its interest" in the appraisal report. Due the Equal Credit Opportunity Act, any home buyer requesting a copy of the report must be given one by their lender.
Myth: There's no reason for consumers to even worry about what the appraisal report contains so long as their lender is fine with the contents therein.
Fact: A home buyer should definitely read through their report; there could be some questions or some worries about the accuracy of the analysis that should be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. There is a wealth of data stored in an report that could be useful to the home buyer 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 region.
Myth: Appraisers are hired only to estimate house values in home sales involving mortgage-lending deals.
Fact: Appraisers can have many varied qualifications and designations which allow them to perform a series of different services including - but definitely not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: You don't need to get an appraisal if you get a home inspection.
Fact: An appraisal report does not serve the same purpose as an inspection report. The task of the appraiser is to form an opinion of value in the appraisal process and through writing the report. House inspectors will compose a report that will explain the condition of the property and its major components and possible damage.