Written by Jon Long on July 24th, 2020
Before you can buy or refinance a home, your lender will need to order a property appraisal to verify the property’s value. Only once a home has been appraised at or near the value you plan to buy or refinance it for will your lender proceed with your loan. This helps to protect you, the buyer or homeowner, as well as the lender. Home appraisals ensure that you aren’t paying more for a home than it’s worth, and that the lender isn’t doling out funds that outweigh the home's value.
To ensure unbiased results, the appraiser who evaluates the home for sale will be selected from a pool of professional licensced real estate appraisers by a third-party company.
The local real estate appraiser will then follow guidelines from the bank to determine the property’s value based upon relevant, comparable sold homes in the area. This home appraisal cost will generally be between $550 to $650.
“Home Appraisals protect buyers and lenders alike.”
Unfortunately, because appraisers are only human, the process isn’t without its flaws. If the randomly selected local real estate appraiser assigned to your property doesn’t know the area well, the results of your house appraisal could be flawed. A property appraisal might also be skewed if the appraiser relies too heavily on a single comparable real estate listing.
Regardless of these potential pitfalls, though, a home appraisal is still a necessary step in the real estate sales and refinance process. Even sellers should consider ordering one before listing their home for sale on the market. This way, they can be sure that no issues related to financing will arise once they’ve gone under contract with an interested buyer. However, it’s important to realize that the value this pre-listing appraisal assigns to your home won’t necessarily be the price you sell for. It’s simply a good ballpark figure to keep in mind.
Unlike an appraiser, your local real estate agent sees what’s going on in the market every single day. In addition to just looking at comparable homes for sale, high-quality local Realtors also keep tabs on current trends. Real Estate Agents understand that these things also play a role in your home’s value. We keep in mind what the average buyer would be willing to pay for your home, as well.
If you have any other questions, need a Orange County appraisal, or would like more information, feel free to give us a call or send us an email. We look forward to hearing from you soon.