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REASONS TO GET AN APPRAISAL
Every year, countless people in the United States buy,
sell or refinance their own slice of the American Dream. Most, if
not all, of these transactions include a simple line item for an
appraisal. It has become an understood and accepted part of a
real estate transaction. "Let's bring in the expert and make
sure we're not spending too much on this property."
But
is this the only reason to get an appraisal? Are there other times when
the services of a certified, licensed, independent real estate
professional might come in handy? You bet.
PURCHASE OF A HOME
One of the most important issues involved in purchasing a
property is developing an opinion of what it's worth so that you can
make an informed offer to purchase. A professional appraisal
report performed by a qualified, state-licensed appraiser can provide
you with an objective, third party opinion of a property's current
Market Value. And for the small price of this service, you can
give yourself "peace of mind" prior to making an offer to
purchase that you're offering a fair price for the property.
REFINANCE OR GET A HOME EQUITY LOAN
If you need to consolidate bills, have a college
tuition to pay, or just want to tap into the equity of your home,
you'll need a new loan, which oftentimes requires a new appraisal of
the property.
PMI REMOVAL
Private Mortgage Insurance or PMI is the supplemental insurance that
many lenders ask home buyers to purchase when the amount being loaned
is more than 80% of the value of the home. Very often, this additional
payment is folded into the monthly mortgage payment and is quickly
forgotten. This is unfortunate because PMI becomes unnecessary when the
remaining balance of the loan - whether through market appreciation or
principal paydown - dips below this 80%
level. In fact, the United States Congress passed a law in 1998 (the
Homeowners Protection Act of 1998) that requires lenders to remove the
PMI payments when the loan-to-value ratio conditions have been met.
Many
appraisers offer a specific service for home owners that believe they
have met the 80% loan-to-value metric. For a nominal fee, the appraiser
can provide you with a statement regarding the home value. Some will
even take the next step and help you file a challenge with your
mortgage company. The costs of these services are very often recovered
in just a few months of not paying the PMI.
DIVORCE SETTLEMENT
A divorce can be a particularly traumatic experience for
both parties and is often further complicated by the difficult decision
of "Who gets the house?". In
most divorce cases, the Court won't usually force the parties involved
to "buyout" the other party's interest but it may however
order the sale of the home so each party gets an equal share of the
equity. Regardless of the situation, it's a good idea to order an
appraisal so both parties are fully aware of what the true market value
is.
If
the parties want to sell the home, they'll have a better idea of what
price to set. And on the flipside, if a "buyout" is the
chosen option, both parties will feel like they've gotten a fair
assessment.
ESTATE LIQUIDATION
The loss of a loved one is a difficult time in life and settling an
estate from a death, or probate, often requires an appraisal to establish
Fair Market Value for the residential property involved. The
ethics provision within the Uniform Standards of Professional Appraisal
Practice (USPAP) binds us with confidentiality, ensuring the fullest
degree of discretion.
Unlike
many wealthy individuals, the majority of Americans do not have
dedicated estate planners or executors to handle these issues.
Also, in most cases, a home or other real property makes up a
disproportionate share of the total estate value.
Here
too, an appraiser can help. Often the first step in fairly
disposing of an estate is to understand its true value. Where
property is involved, the appraiser can help determine the true
value. At this point, equitable arrangements can more easily be
arrived at among disputing parties. Everyone walks away knowing they've
received a fair deal.
RELOCATION
We understand the stress involved with an
employee relocation. We take great care in establishing a
convenient appointment time for the appraisal inspection. During our
thorough inspection, we encourage relocating employees to provide input
on the positive attributes of their property along with information
about any recent sales or listings in their neighborhood that they want
considered.
HOME IMPROVEMENTS TO ADD VALUE
Before you decide to sell your home, there are
several decisions to be made. First and foremost: "How much should
it sell for?" But don't forget there may be other equally
important questions to ask yourself such as "Would it be better to
paint the entire house before we sell it?", "Should I put in
that third bathroom?", "Should I complete my kitchen
remodel?" Many things which we do to our houses have an
effect on their value. Unfortunately, not all of them have an
equal effect. While a kitchen remodel may improve the appeal of a home,
it may not add nearly enough to the value to justify the expense.
SELLING A HOME
Whether you choose to sell your home on your own or use the assistance
of a real estate agent, a professional appraisal can help you make a
better educated decision when determining your selling price.
Unlike
a real estate agent, an appraiser has no vested interest in what amount
the house sells for. It's easy for them to step in and give you
the information to help you make your decision. Appraiser fees
are based on efforts to complete the report and not a percentage of the
sales price. So seeking a professional appraisal can often help
homeowners make the best decisions on investing in their homes and
setting a fair sales price.
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