If you are considering purchasing a Home in Raleigh this Summer – here are 4 Things you should know about Home Appraisals
As you probably already know, summertime is a very busy time for Raleigh real estate agents. That’s when so many home buyers decide to enter the market and begin searching for their home.
If you too are planning to purchase a home in the Raleigh area in the upcoming months, then you’ve come to the right real estate source!
Today, we’re going to share four things that every home buyer should know about appraisals.
What Are Appraisals and Why Are They Important?
An appraisal is the valuation of a home by a licensed professional. It is this estimate of value that is particularly important for those who will be taking out a loan on their next home. So if you are like the majority of home buyers, you will more than likely end up requesting a loan to finance at least a part of you home purchase.
When you ask for that loan, banks reference your home’s appraisal as a way of deciding how much to loan you. That’s why appraisals are so important. Consider this example: Let’s say you offer to purchase a home for $120,000. You plan on financing 100% of the purchase price, so you will need a loan for that amount. However, when the appraisal comes back, for whatever reason, it says the home is worth only $100,000. The bank will only be willing to loan you up to the appraised value, $100,000, and not a penny more.
This means that you’re faced with a $20,000 budget gap. And that’s enough to kill many a real estate deal.
But Don’t Worry – We Can Help!
Here is some valuable information on appraisals that may help you avoid unfortunate situations like the one above:
Appraisers must meet certain criteria first. According to the Appraisal Institute, a qualified appraiser should be licensed or certified and also should be familiar with the local area. What’s more, federal regulations stipulate that the appraiser must be impartial and have no direct or indirect interest in the transaction. Fannie Mae even requires that appraisers certify that they have experience appraising similar properties in the same area.
Appraisal values are influenced by a number of factors. For instance, appraisers will consider recent sales of similar properties as well as current market trends. They’ll also factor in such things as the home’s amenities, number of bedrooms, floor plan functionality and more.
Appraisers are required to do a complete visual inspection of the interior and exterior of the home. During this time, they’re also required to note any conditions that may adversely impact the property’s value. This may include needed repairs.
Generally speaking, appraisers use Fannie Mae’s Uniform Residential Appraisal Report for single-family homes. This report asks the appraiser a number of questions, including what the home’s interior and exterior look like, what neighborhood it’s located in and what nearby comparable sales there are. Other parts of the report include: a street map showing the appraised property, an exterior building sketch, an explanation of how the square footage was calculated, and photos of the home. After providing all of this information, the appraiser offers an analysis and conclusions about the property’s value based on this information.
We’ll Help You At Every Stage of the Home Buying Process
We hope you found the above information helpful as a prospective home buyer. What is even more useful is having a knowledgeable Real Estate Professional with you every step of the way. This is where the Real Estate Experts at Capital City Real Estate Group in Raleigh come in. With EVERY stage of the home buying process, we want you to know that we’ll be there to assist you in order to make the experience as seamless as possible. We keep things moving and worry about all the details – so you don’t have to.
Contact us today to learn more about the services we provide and the valuable advice and insight we can offer.