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Real Estate Appraisal Help
By Administrator | November 22, 2011
What can be done to protect from a low appraisal?
Be proactive. Federal rules allow you to provide the appraiser your own comps — recently sold properties of similar size, condition and amenity levels in your immediate market area. Your realty agent can help you pull them together before the appraiser arrives. Or for a fee of $200 to $300, you can hire an experienced local appraiser to assist you.
Sara W. Stephens, president-elect of the Appraisal Institute, the largest group in the industry, says, “If you know there are comparable sales in the neighborhood” where the price was affected by a divorce, financial distress or heavy seller concessions to the buyer, “make sure you call the appraiser’s attention to” these factors. And give the appraiser a list of all the value-enhancing upgrades and improvements you’ve made, including dates and costs.
Accompany the appraiser during his or her inspection of the house. Ask questions crucial to competency: Where are you based? How long have you been in the business? What certifications and professional designations do you hold? Are you a member of the local multiple listing service (MLS), an essential trove of data for any accurate appraisal? Do you know local agents or brokers who can supply you with pending sales information and guide you on neighborhood price trends?
If the appraiser doesn’t have good answers, you are much more likely to end up with a poor appraisal. Alert the lender to your concerns as early as possible.
After the appraisal is completed, always ask for a copy to review; it’s your right under federal law. If the value comes in low, check everything in the report, from selection of comps to the accuracy of property measurements. If you find serious mistakes and the appraiser refuses to make corrections, appeal directly to the lender. Most have procedures to follow regarding “reconsiderations of value.” Ask for a second valuation by a locally competent appraiser, even if that costs you more money. Ken Harney
Call Kevin Cavanaugh 408-356-2506
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