For homebuyers who will be purchasing a home utilizing a home loan, the mortgage lender will require you to purchase an independent appraisal to verify the market value of the property. The primary reason they require this is to make sure they are not loaning more money than the home is actually worth.
You may have recently entered into an agreement to purchase a residential property, or you may have completed a loan application to refinance your home. Lenders are required to obtain an appraisal, prepared by an impartial and unbiased appraiser, and use it as the primary tool for assessing the sufficiency of your collateral. You may want to retain an appraiser to provide an appraisal to help you make decisions such as buying, selling or financing your home.
An appraisal is an opinion of value. For estate planning, financial planning, or sale price decisions, individuals or a trusted advisor usually orders an appraisal. When an appraisal is used to obtain an opinion of value of a property for loan purposes, federal regulation requires the lender or its agent to place an appraisal order. The lender or its agent contacts a state licensed or certified appraiser and identifies the property to be appraised and the intended use of the appraisal.
The appraiser then determines the appropriate scope of work for the assignment. The appraiser’s scope of work typically includes the type of property inspection (interior, exterior only or none), what approaches to value are required, and any lender-specific requirements. In some cases, the lender may order the appraisal through an agent, such as an Appraisal Management Company (AMC). There is no single standard appraisal report form, format, or style. However, for residential mortgage lending, Fannie Mae (FNMA) and Freddie Mac (FHLMC), which are Government Sponsored Enterprises (GSEs) that purchase mortgages on the secondary market, have developed residential appraisal report forms that are commonly used to communicate the appraisal of properties used as collateral. Regardless of the type of appraisal report used, all appraisal reports must contain sufficient information to enable the intended users to understand the report properly.
Depending upon your location, a residential appraisal typically costs between $400-600.00 and is normally paid along with other loan costs at the time of closing. Your lender can provide more specific details or feel free to give us a call with any additional questions.
Voted "Best of Apopka"
Top Real Estate Professionals
Freshest Data Available
Active Listings Only
Customizable Search Options
New Listing Alerts
Instant Home Value Assessments