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Whether you’re applying for a mortgage to buy a home, refinancing your existing mortgage, or selling your home to anyone other than an all-cash buyer, a home appraisal is a key component of the transaction. If you’re a buyer, owner, or seller, you’ll want to understand how the appraisal process works and how an appraiser determines a home’s value. An appraisal is an unbiased professional opinion of a home's value and is required whenever a mortgage is involved in buying, refinancing, or selling property. A qualified appraiser creates a report based on an in-person inspection, research into recent sales of similar properties, current market trends, and the details of the home, including its size, condition, floor plan, and amenities.

Home Appraisal: A home appraisal is a third-party evaluation that determines the value of a house, performed by a licensed appraiser. Appraisals are nearly always done during the process of buying a home, and they can also be a part of the refinancing process for current homeowners and/or used as a tool for home sellers to accurately assess their home’s value before listing it. During the home buying process, an appraisal is typically ordered by the homebuyer’s lender once a buyer is under contract. Appraisals include a report evaluating the property’s features, and general condition, a list of comparable properties that have recently sold, and a final valuation of the property being assessed. The appraisal report verifies the value of the home so that the lender can officially approve a loan for their client to purchase a specific home. Please go here to this link Long Island Real Estate Appraisal to get more of the Guide to Home Appraisals.

Why are Appraisals Important for Homebuyers? Appraisals are one of the most important steps in the home-buying process. A property appraisal is one of the requirements lenders have to approve and process a home loan, enabling a buyer to move toward closing on the house. A bank does not want to give out a loan amount that exceeds the value of the home, because if the buyer defaults on the loan, they won’t be able to sell the property for enough money to cover their loss. Home appraisals also provide homebuyers with peace of mind when purchasing a property. The appraiser provides information on comparable homes that have recently sold in or around the neighborhood, providing insight into the home’s worth based on similar features, size, and characteristics. Appraisals help ensure the buyer of the value of the home they are buying. 

What Do Real Estate Appraisers Look For? Licensed appraisers thoroughly inspect real estate properties to assess their true worth - which isn’t always the same as what it’s listed for. Property appraisers will use the buyer’s loan type and criteria set by the lender to evaluate certain items in and around the home, such as the house level (one or two-story) as well as features like yard size or if the home has a garage. Appraisers also look at comparable homes that have recently sold in that area to help determine the value of the home.  Appraisers, licensed by the state, provide a pass-or-fail evaluation of the home’s value. A home that passes the appraisal is identified as appraising “at value” - the value being the sales price that the buyer and seller have previously agreed upon. The goal is for the sales price to be at or below the appraised value of the home; if not, negotiations could resume, and close on the property could be delayed. 

What Information Goes Into an Appraisal? Professional appraisers consult a range of information sources, including multiple listing services, county tax assessor records, county courthouse records, and appraisal data records, in addition to talking to local real estate professionals.  They also conduct an inspection. Typically, an appraiser’s inspection focuses on: The condition of the property and home, inside and out, The home’s layout and features, Home updates, Overall quality of construction, Estimate of the home’s square footage (the gross living area “GLA”; garages and unfinished basements are estimated separately), Permanent fixtures (for example, in-ground pools, as opposed to above-ground pools).

Who Pays and How Long Does It Take? The buyer usually pays for the appraisal unless they have negotiated otherwise. Depending on the lender, the appraisal may be paid in advance or incorporated into the application fee; some are due on delivery and some are billed at closing.  An inspection usually takes anywhere from 15 minutes to several hours, depending on the size and complexity of your property. In addition, the appraiser spends time pulling up county records for the values of the houses around you. A full report is sent to your loan officer, real estate agent, and/or lender in about a week. If you are the seller, you won’t get a copy of an appraisal ordered by a buyer. Under the Equal Credit Opportunity Act, however, the buyer has the right to get a copy of the appraisal if they request it. Typically, the requested appraisal is provided at closing.

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26 Railroad Ave. Suite 347 Babylon, NY 11702