Appraisal myths debunked
By law, an appraiser must be state-licensed to produce appraisals for federally-backed purchases. The law allows you to get a copy of your finished report from your lender after it has been produced. Contact us if you have any questions about the appraisal procedure.
Myth: Assessed value generally will be similar to to market value.
Fact: It could be that Puerto Rico, like most states, validates the common myth that the assessed value equates to the market value; however, this is not often the case. Generally when interior remodeling has been done and the assessor is has not investigated the improvement or properties in the area have not been reassessed for years or more, it may vary wildly.
Myth: The buyer or the seller often will have leverage in the cost of the property depending upon for whom the appraiser is working.
Fact: There is no vested interest on the part of the appraiser in the result of the appraisal, therefore he will complete his work with impartiality and independence, regardless for whom the appraisal is created.
Myth: Market value should equate to replacement cost.
Fact: Market value is based on what a willing buyer would likely pay a willing seller for a particular home, with neither being under duress to buy or sell. If the home were rebuilt, the dollar amount necessary to do so would set the replacement cost.
Myth: There are specific methods that appraisers use to find the value of a home, like the price per square foot.
Fact: An appraisal report is an assertion of data based on the home's size, location, proximity to undesirable facilities, the condition of the home and the worth of recent comparable sales. You can rely on Appraisal Advisors Group's appraisers to be professional in assessing this information.
Myth: In a powerful economy - when the sales prices of homes in a given county are reported to be rising by a particular percentage - the prices of individual properties in the proximity can be expected to rise by that same percentage.
Fact: Any cost at which an appraiser concludes concerning a particular house is always personalized, based on certain factors pulled from the information of comparable homes and other considerations within the property itself. It makes no difference whether the economy is good or poor.
Have other questions about appraisers, appraising or real estate in Caguas County or Caguas, PR?Contact Appraisal Advisors Group
Myth: The house's exterior is determinate of the actual worth of the property; it is unnecessary to do an interior inspection.
Fact: Property worth is determined by a multitude of variables, including location, condition, improvements, amenities, and market trends. An outside-only inspection definitely can't provide all of the data needed.
Myth: Considering that the consumer is the party who puts up the funding to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal report is theirs.
Fact: Legally, the document is owned by the lender unless the lender releases their interest in the appraisal. However, home buyers have to be given a copy of the report upon written request, through the Equal Credit Opportunity Act.
Myth: Consumers need not be concerned with what is in their appraisal report so long as it exceeds the necessities of their lending institution.
Fact: A home buyer should definitely inspect their appraisal; there could be some questions or some worries with the accuracy of the report that should be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. An report can serve as a record for the future, containing an incredible amount of data - including, but certainly 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 area.
Myth: There is no reason to order an appraisal unless you are trying to get an estimate of the worth of a house during a sales transaction involving a lender.
Fact: Based upon their qualifications and designations, appraisers can and do perform a lot of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: An appraisal is no different than a home inspection.
Fact: An appraisal does not serve the same purpose as an inspection. The reason behind an appraisal is to form an opinion of fair market value during the appraisal process and the completion of the appraisal. The job of a home inspector is to determine the condition of the property and its main components, then provide a report on their inspection.