If you’re interested in selling your home or getting it refinanced, you’re going to have to get it appraised. If the appraisal isn’t favorable, it can greatly reduce the value of your home. According to MSN.com, “Some of the advice [for appraisals] — like home valuations themselves these days — might seem contradictory. But what all the appraisers agree on is the importance of keeping the look, feel and condition of the property as updated and cared-for as possible.”
It’s incredibly important that you do some research and understand what you are going to be going through during this process.
Although your mortgage lender isn’t able to conduct the appraisal of your home, they are the ones who orders it via an appraisal management company. That company will then choose someone to visit your home for 20 to 45 minutes. During this time they will check out the condition, size, quality and other aspects of your home.
The Three Portions of an Appraisal
With each appraisal, you’re going to have an inspection, the comparable homes, and the final report. The inspection is where the appraiser visits your home, the comparable homes portion details similar homes that have been sold in your area, and the final report is how your home matches up against the comparable homes and then assesses how much your home is worth.
The overall look of your home will play a role in appraised value of home. So, that should go without saying that when it comes time to be visited by the appraiser, you’ll want to tidy up, make repairs, and make sure the outdoors is nice.
What constitutes as keeping the yard nice? This means the hedges, weeding any flower beds, mowing the lawn (or laying out grass seed), picking up any debris like fallen limbs or acorns. Also, making sure your outside is nice also includes your home. Repair any broken or damaged siding, repair the roof, fix the gutters. These things all add up in the end.
Move To the Inside
Once the outside looks great, you’ll want to move to the inside. Look at your home as though you don’t live in it, but you are buying it. What sort of things do you notice that would turn you off from the home. For example, maybe the paint could be freshened up, maybe the carpets need cleaning, the knick-knacks could use a good dusting and certainly get rid of that pile of junk mail. Why, would you believe that old furniture, appliances, and electronics can also play into the appraisal, even if those items aren’t staying in the home?
The $500 Rule
Appraisers value a home in increments of $500. What this means is that they will value your home based on everything—even including minor repairs like a leaky faucet or a lightbulb that is out. You should fix all door latches or handles that don’t work, old carpeting, broken or torn screens, and replace damaged flooring.
The appraisal process can be nerve wrecking, but it doesn’t have to be when you are prepared. Before that big day comes, research what an appraisal is like near you and plan to make necessary corrections. What small things you repair today will be dollars in your pocket tomorrow.