How To Prepare For A Home Appraisal?

Taking a picture of the front of a house for a home appraisal

Here are some of the questions addressed in this post.

Your search for the perfect Pittsburgh home has finally been completed after several weeks of touring homes throughout the city. When the seller accepts your offer, your offer is now under contract, and the home will be marked contingent on the seller accepting it. In the process, your mortgage lender informs you that the next step is an appraisal of your home. Despite the fact that the process may sound intimidating, there is no need to be alarmed. Home appraisals are typically required by mortgage lenders and are necessary to obtain a mortgage.

What is a Home Appraisal?

An appraiser checks the house for an appraisal

During a home appraisal, a home is evaluated in person, and a comparative financial analysis is conducted to determine its value. Home appraisals are almost always required by mortgage lenders when a buyer applies for a loan in order to ensure the buyer does not overpay for the home. The lending institution does not want to lend more money than the property is worth. In the event that the purchaser defaults on their mortgage payments, the lender will be left with an overpriced property that will not deliver a high return on investment. An appraisal of a home is also beneficial to buyers because it determines whether the seller is asking for too much money for the property. For example, when a buyer is planning to purchase a home for $400,000, but the appraisal indicates that the home is only worth $315,000, the buyer will have an additional $75,000 worth of negotiating power. When purchasing a property, home appraisals are commonly requested. However, homeowners are also required to obtain appraisals when refinancing their mortgages. 

 

This is an important point to note – both here in Pittsburgh and throughout the country – that mortgage discrimination is illegal. Under the law, lenders must refrain from discriminating against borrowers based on their sex, race, marital status, religion, age, disability, national origin, or their use of public assistance. If you believe your mortgage lender has illegally discriminated against you, you may file a report with either the Consumer Financial Protection Bureau or the Department of Housing and Urban Development (HUD).

How Long Does A Home Appraisal Take?

An appraiser works for the appraisal report

The average home appraisal takes about 30 to 45 minutes to complete. You may need to wait longer if your home is particularly large or complex. Your home will be photographed from top to bottom, including the garage and exterior. Additionally, they will measure various aspects of the house. An appraiser will also assess the sale price of other homes in the area and do a physical inspection. An appraisal report will be provided to you once the physical appraisal has been completed and the comparable report has been run. Appraisal reports are usually sent to you within 7-10 days of the appraisal company completing them. Lenders are legally required to provide you with appraisal reports and cannot withhold them. 

What Do They Look For In A Home Appraisal?

An appraiser checks the house for signs of damages

When appraising a home, appraisers consider many factors, including:

Signs of disrepair 

A home appraiser will generally look for signs of significant disrepair when conducting a home appraisal. As part of their inspection, they will examine the floors, bathrooms, carpeting (if applicable), walls, kitchen appliances, roof, materials used throughout the home, air conditioning system, and the house’s overall exterior. Their general focus is on items that are a safety hazard, broken, or malfunctioning in some way.

Water damage

It is possible that mildew or mold may be present in a home with water. In that case, the appraiser will check the wall, floor, ceiling, attic, basement, and other areas of the house for moisture damage. It may be possible for you to repair minor water damage on your own to put the buyer at ease if it appears on your appraisal report. Mold poisoning is extremely toxic to those who are exposed to it for an extended period of time, so it is important to identify signs of water damage in the ceilings, walls, and/or floors. 

Size of the home

Apart from the physical home, they will look at the size, the number of bedrooms, upgrades, and other property details. A home’s square footage is not the only thing the appraiser considers; the garage’s and its lot’s size will also be taken into account. If it’s an apartment, those factors won’t all be considered. 

Infestation

The appraisal report will be negatively impacted if there are any signs of infestation, as that is a safety issue. It is important for an appraiser to examine the windows, ceilings, and floors of a home for signs of pests – especially termites – as they can cause considerable damage to a home’s structure. 

Comparable Properties 

An appraiser will compare the sale prices of homes in the vicinity with those in the appraisal area. Your mortgage lender may only lend you $350,000 if other homes in your neighborhood sold for $350,000 but you plan to purchase a $400,000 home. The seller will have to reduce their sale price to $350,000 if that happens, which your real estate agent will negotiate with them. Your mortgage lender will not lend you the $50,000, so you’ll either need to come up with the $50,000 or walk away from the deal entirely if they won’t budge on price.

Key Takeaways

Home appraisals are an essential part of the buying, selling, or refinancing process. This is also one way to get your Project Management Institute (PMI) waived early on your home loan. Home appraisal day can be prepared in several ways, and many of these steps can positively impact the home appraisal report. Professionally cleaning your home before the home appraisal could give the appraiser a positive impression. If you need more help selling your houses, you may contact us here.

A home appraisal is an evaluation of a property’s value conducted by a professional appraiser. Mortgage lenders require appraisals to ensure that the property’s value aligns with the loan amount and to prevent overpaying for the home, safeguarding their investment.

On average, a home appraisal takes about 30 to 45 minutes, but larger or more complex homes may require more time. The appraisal report is usually provided within 7-10 days after the appraisal company completes the physical inspection.

Appraisers examine various aspects, including signs of disrepair, water damage, home size, infestations, and comparable properties in the neighborhood. They focus on safety hazards, broken or malfunctioning items, and overall property conditions.

Yes, water damage can negatively impact the appraisal report as it poses safety risks. Homeowners should address minor water damage to reassure potential buyers. If significant issues are found, seeking professional repairs is essential.

 Appraisers compare the sale prices of similar properties in the area to determine the home’s value. If the home’s price exceeds comparable properties, the seller may need to adjust the sale price to align with market trends and lender requirements.

Homeowners can positively impact the appraisal report by maintaining the property’s condition, professionally cleaning the home, addressing minor repairs, and considering market trends in the area.

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