Appraisal myths debunked

It is enforced by law that a real estate appraiser must be state-licensed to perform appraisals for federally-related property purchases in Texas. You are also entitled by law to demand a copy of the finished report from your lender. Contact our professional staff if you have any questions about the appraisal procedure.

Myth: Market value needs to be equivocal to the assessed value of the property.

Fact: While most states uphold the idea that assessed value approximates estimated market value, this commonly is not the case. Interior reconstruction that the assessor has not investigated and a dearth of reassessment on nearby homes are excellent examples of why this occurs.

Myth: The buyer or the seller can have an influence in the cost of the property depending upon for whom the appraiser is working.

Fact: The appraiser has no vested interest in the result of the appraisal report and should conduct his job with independence, objectivity and impartiality - no matter for whom the appraisal is conducted.

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

Fact: Market value is arrived at through what a willing buyer would be interested in paying a willing seller for a certain home, with neither being under undue influence to buy or sell. The replacement cost is the dollar amount necessary to reconstruct a home in-kind.

Myth: Specific formulae, like the price per square foot, are the methods appraisers use to ascertain the cost of a property.

Fact: An appraisal report is an amalgamation of data based on the house's size, location, proximity to some facilities, the condition of the home and the value of recent comparable sales. You can rely on Young Appraisal Company, Inc.'s appraisers to be forthright in assessing this information.

Myth: As homes appreciate by a specific percentage - in a robust economic state - the houses within the same neighborhood are figured to increase by the same amount.

Fact: Any cost at which an appraiser arrives in regards to a particular house is always personalized, based on certain factors found from the information of comparable homes and other considerations within the home itself. It makes no difference if the economy is excellent or bad.

Have other questions about appraisers, appraising or real estate in Tarrant County or North Richland Hills, TX?

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Myth: Just seeing what the house looks like on the outside gives an idea of its cost.

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

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

Fact: Legally, the document is owned by the lending company unless the lender relinquishes their interest in the document. Under the Equal Credit Opportunity Act, any consumer requesting a copy of the report must be given it by their lender.

Myth: Consumers need not worry about what is in their appraisal document so long as it exceeds the necessities of their lending group.

Fact: Only if home buyers check out a copy of their appraisal can they double-check 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 an incredible amount of 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 proximity.

Myth: The only reason someone would hire an appraiser is if a home needs its value estimated in a lender-based sales transaction.

Fact: Depending upon their qualifications and designations, appraisers can and do provide a series of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.

Myth: A home inspection serves the same purpose as an appraisal.

Fact: Appraisal reports are completely different than a home inspection. The appraiser concludes on an opinion of value in the appraisal process and resulting report. A home inspector determines the condition of the house and its main components and reports their findings.